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Why Are Telcos Still Struggling with Customer Experience? See The Top CX Gap In Telco 

The telecommunications industry is under immense pressure to evolve at a daunting pace. With the rise of competitive alternatives, Telco services are increasingly commoditized. Margins are being eroded, and the question of how to stay relevant and competitive is at the forefront for every industry decision-maker. To create impactful differentiators, Telcos must harness the power of customer experience (CX) for both B2B partners and end users. 
The status quo won’t retain or win over customers today. To distinguish their brand in the marketplace, Telco leaders are looking for opportunities to break out of the stereotype of laughably poor customer experiences often projected on the industry. Their CX gaps provide that opportunity.

The water is getting warmer in the Telco world, unfortunately, and not in a good way.

Person speaking into a phone while on a laptop

Addressing the Experience Gap in Telco

The Experience Gap is a perpetual challenge that impacts every business and every industry. It encompasses twenty distinct facets—or smaller gaps—which can be summed up into five main categories: Perceptual Gaps, Communication & Engagement Gaps, Operational Gaps, Technological Gaps, and Data & Analytics Gaps. Few businesses have them all, but nearly all businesses have at least one.

“Experience” is a relatively broad term. Many confuse customer experience with chatbots and call centers, but every interaction a customer has with a brand is part of their experience. Whether visiting a retail location, opening an app, seeing an ad, or chatting on the company website, each channel has the potential to impress or disappoint.

And, with 54% of consumers reporting they’d stop using a brand after just one bad experience, meeting customer expectations isn’t always enough—exceeding them is fast becoming table stakes. 

54% of consumers report they’d stop using a brand after just one bad experience.

The Stellar Elements CX20 Global Gap Study revealed that there are 20 distinctive gaps that fall under the overarching Experience Gap. And, though trends are clear across the board, each industry falls prey to the CX gaps in unique ways.  
Consider these an industry’s gap “fingerprint” that business leaders can leverage to guide their transformation efforts. Some Telcos have CX gaps that are so pervasive they actively harm the brand. Identifying the gaps holding back your organization is key to uncovering your hidden opportunities to create a brand experience that attracts new customers, strengthens existing brand loyalty, and streamlines operations. 

The Top CX Gap for Telco

The CX gaps uncovered in our recent study create persistent pain—and worse, prove to be universal. 
For the Retail industry, the Service Gap topped the Stellar Elements CX20 Global Gap Study. Not to be conflated with customer service alone, the Service Gap encompasses all the shortcomings between the high-quality service that customers expect and the actual service they receive. Failing to provide customers with the high-quality service they expect can erode trust, satisfaction, and loyalty. This gap highlights the importance of human interactions in service delivery. 

60% of business leaders in Telco identified the Integration Gap as their top concern.

For Telco, the study revealed that 60% of business leaders in Telco identified the Integration Gap as their top concern. Defined as the failure to provide the seamless experience customers expect, the Integration Gap is exacerbated by insufficient resources leading to disjointed customer experiences.  

After over a decade of countless transformation projects aimed at detangling legacy systems, telcos are still struggling to achieve business agility. According to PWC’s Perspectives from the Global Telecom Outlook 2023-2027, telecommunication companies have more investments ahead of them, with Telco projected to invest $342.1 billion in their networks through 2027.

Leaders attribute the widening Integration Gap to rapid company growth, which leads to tech debt in the form of disparate systems, inefficient processes, dated technology, and organizational disarray. While growth is always the goal, lack of preparation for it can contribute to broken customer experiences. 

This is particularly evident in B2B services, where telcos tend to deprioritize enterprise experiences. However, expectations are only getting higher for customers in this segment, and they are growing impatient for improvements to quality, consistency, services centralized view, and ease-of-use. 

There is no opportunity to create a distinct competitive advantage if persistent operational issues continue to be ignored. Improving operations with a clear vision of what to address first is essential when carrying significant technology debt—and CX debt. 

When resources and budgets are tight, prioritizing the gaps that cause the most friction is vital. As telcos grew, the number of channels—both human and tech—multiplied, while investments in bringing them all together slowed. With AI/ML investments shoehorned into the mix, many brands have made the mistake of leading initiatives with a technology lens instead of an experience focus. As a result, broken customer experiences began to pile up right when customers were finding new ways to interact with a brand. Now businesses must adapt by connecting experiences across multiple channels and touchpoints. 
This creates a huge opportunity for any telco to turn this gap into a key competitive differentiator. In an environment where comments like “people love to hate their telcos…” abound, the path is clear for those who want to break that mold. An honest assessment that identifies the most crucial gaps in your business will reveal insights to dynamically align your CX strategy with evolving customer needs.  
Neil Mendes is head of Public Mobile, a Canadian wireless subscription service that defines itself as doing mobility differently. He explained the company’s strategy to turn a gap into an opportunity: “It was time for us to evolve our brand to provide customers with a new service wrapped in a new visual identity that reflects these changes. And, with it, we're uniquely positioned to empower customers with more choice, better value, transparency, and a great overall digital experience.” 

“It was time for us to evolve our brand... And, with it, we're uniquely positioned to empower customers with more choice, better value, transparency, and a great overall digital experience.”

Neil Mendes, Head of Public Mobile

Experience teams can adjust based on data, not just direction, targeting areas that will have the greatest impact. In competitive markets where the moves are crucial to survival and maintaining market share, an honest assessment is essential.

Each Telco Faces Unique Customer Experience Gaps

“No two telecommunications companies are exactly alike,” says Fadi Dajani, Stellar Elements VP, Telco Practice. “Some major players are making successful forays in media, healthcare, and even fintech. Some are testing and launching add-on services. While new revenue streams are a terrific way to grow, they will not fix any operational or scalability gaps that have been ignored. Telcos must address their technology debt and subsequent CX debt.” 

“Telcos must address their technology debt and subsequent CX debt.”

Fadi Dajani, VP, Telco Practice, Stellar Elements

Take the Guesswork Out of Your Brand Experience

Although the CX20 study revealed that the overall Telco industry views Integration as its biggest challenge, the stakes are too high to assume it is the highest or the only gap concern for your telco. Assumptions that could lead to countless iterations and Telco strategists cannot rely on pivoting in a market where carefully curated technology adoption will determine who wins the experience game.  

Stellar Elements developed the CX20 Diagnostic Tool to help you identify the specific gaps holding back your own organization. Take the self-assessment to see your top five gaps—and how you can close them.

Take the Self-Assessment

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