Get Data ready for the Launch Frenzy – The MVNO roller coaster

1. 1. The launch frenzy
   2. The growth machine
   3. The reality check
   4. Capital raising (or maybe an exit)

We are a data and AI business specialising in telco and MVNOs.  We have met MVNOs and partners at each of these phases and we’ve learnt a lot from talking to them. In this blog series we share our learnings about data and how it should be used and leveraged through the roller coaster ride of an MVNO.

The reality for most MVNOs is that you’ll spend more time and care planning your launch than any other thing in the life of your MVNO and when you get to each new horizon you will wish that you had planned it earlier and better.  Deep understanding and the ability to confidently assess what is likely to happen next underline each stage and contribute to your success. Data and data literacy are essential; these are the essentials that allow you to be ready to pivot your attention quickly into the next phase (or back again) at the drop of a hat and evaluate your decisions and their consequences effectively.

In this first article ‘Get data ready for the Launch Frenzy’ we will cover the following topics:

• • Foundational capability considerations
  • Expectations from your MNO
  • Best use cases for leveraging AI
  • The ingredients for the growth phase
  • Your business metrics during capital raising

Foundational capability considerations

If you are starting out you will (I hope) take advice from one of these amazing people that can help you get started as an MVNO – Gary Bhomer, James Gray, Tim Burgess, Paul Nicholas, Ian Ginn, Kate Vanderpool (to name a few). They will tell you about all the necessary things to launch your MVNO – this will include:

• • Core network connectivity
  • MVNE / BSS / OSS / OCS capability
  • Wholesale arrangements
  • Product market fit
  • Brand and marketing

These people will give you a massive ‘leg up’ so that you launch leveraging the learnings of the many and varied MVNOs that they have helped to launch.

Some might argue that a CDP (customer data platform), BI and marketing automation aren’t essential for launch but you will find that as soon as your immediate launch is done – these are exactly the foundational capabilities that you will need.

Why do you need a CDP?

You will be focused on adding subscribers and your CDP is the weapon you’ll need to do this. A CDP (Customer Data Platform) collates and organises all the data that you hold about your prospects and customers. It makes this kind of data available so that you run AI models, run sophisticated marketing using customer behaviours and facts and mine your customer base for cross sales and referral-based acquisition. Without a CDP you’ll be limited to trigger-based marketing with limited historical data to segment your customers or to learn from.  You don’t need to go as far as Snowflake but enough capability to make your data work for you is what you’ll need until you get to +500k – 1m subscribers.

Surely BI is a overkill when I start out?

I’m not suggesting that you need to invest in Tableau! Your MVNE partner will (most likely) have you covered for operational reporting such as subscriber base, revenue, invoice, processes etc but you will quickly want to slice and dice your data, run full subscriber reporting and go beyond superficial analysis, trigger-based marketing and full post campaign analysis so you better understand cause and effect. Get into the data as soon as you launch to optimise your conversion opportunities.

Marketing automation – this is a real must!

In your launch phase you may not need to go far beyond Mailchimp to manage multi channel campaigns and two way communication. There are lots of options – my advice look for easy to use journey builders  that can be operated by your own team or for a vendor that knows telco based CVM that will operate this as a managed service so that you don’t need to manage head count while you are growing.

There are no shortage of products to choose from but keep an eye on those with deep telco expertise and with pragmatism as to how you implement this.

Expectations from your MVNO

The expectations in your growth phase are unsurprisingly about growth. You will want to make sure you have the people, process and measurement to manage wholesale relationships so that you’ve got the best products to compel your growth and marketeers that can put their hands to the tools to drive growth, see the growth hack and innovation opportunities without blowing your budget – which unfortunately probably won’t go as far as you want.

A quick side note about budgets…be ready for fast scrutiny and the ability to answer the fundamental question about how to link conversions to marketing spend – telco expertise is crucial here and as soon as you can get onto Marketing Mix Modelling to scientifically answer the question about marketing effectiveness – you’ll gain trust from your board as soon as you can show this level of confidence in your marketing spend.

Look at Dalefon in Mexico, Eight in Singapore, Lebara, Tangerine in Australia and Mate in Australia for some great examples of the kind of marketing and innovation possible to accelerate growth.

Best use cases for leveraging AI

At this early point your focus should be on getting AI ready – getting your data collated and organised so that as soon as you see enough data you’ll be able to really capitalise on AI.

There are a few discrete use cases that you can leverage AI – specifically in relation to contact centre automations and efficiencies but your use of AI at this point will most likely be limited to LLM applications.

Be wary of the comparison to the MNOs and larger brands who might be using AI for other things – you typically need to see thousands of repitions for AI to really learn from your data.

The ingredients you need for the growth phase

We’ve seen lots of MVNOs succumb to temptations but our list of common ingredients for success is pretty simple:

1. Telco expertise: Get people around you that are battle hardened launching an MVNO.

2. Focus & leadership: It’s always easy to get distracted but the focus on sustainable growth is your biggest superpower.

3. Product: Ideally a point of difference, but if not, a dependable product that lives up to the promise that you have made to your early adopters and commitment from your operator around consistent pricing so that your growth isn’t forced to stall

4. Budget: Enough money to establish, put your foundations in place and prove your growth for your next funding round.

5. Dependable core capability: Your core capability partners have got to be trusted people that you can work with that will provide you with reliable tools and be trustworthy and collaborative to work with.

6. Data ready & data actionability: See above…CDP, marketing automation and BI separate those that scale fast from those that flounder

Important business metrics

As you continue in the growth phase investors will be tracking your key metrics – you’ll know what these are in your specific case but I thought it might be worth sharing the most common KPIs that we see MVNOs tracking in addition to your financial metrics.

Subscriber base:
Total base although be careful not to use this as a vanity metric. You’re only kidding yourself if you count inactive users as subscribers.

Active base:
The customers that you actually have a relationship with!

Targetable and addressable audience:
A realistic understanding of your reach based on your marketing so that you have a realistic view of the audience that are targetable and addressable so that you have a proxy for brand awareness.

 Brand awareness:
This will help you know better analyse the impact if brand, targeting and product.

Funnel conversion:
The ability for your marketing to build your base.

CPA:
The cost of acquiring customers; per channel. Telco specialised marketing mix vendors will also be able to help you with free advice on this ahead of you being able to analyse your marketing spend.

Inactivity:
This will be the first indicator of your MVNO’s health. Watch inactivity like a hawk.

Outflow:
This is key consideration in CVM (especially if you follow the IBRO method). You need to understand volume and pathways of outflow so that you can properly address LTV and churn.

Churn:
Land on a common definition of churn from the beginning. Manage this actively from the beginning to avoid wasting every marketing dollar that you thought you had spend wisely!

LTV:
This metric is always underused. It is one of the best base metrics because it will tell you about the quality of your base and the sustainability of your product, pricing and marketing approach.

I hope that this summary of our learnings about launch stage MVNOs has been helpful. We’ll be publishing a follow up article called  ‘Turning your MVNO into a growth machine’ covering the following topics in a few weeks time.

• • Foundational capability considerations
  • The evolution of your team
  • Best use cases for leveraging AI
  • What’s next – the reality check
  • Capital raising & exit considerations

You’re welcome to get in touch with me for more information or to chat about your launch – we would be delighted to help you!