Reducing churn, increasing ARPU and driving growth with ODA-driven price planning

Commercial context

Rising competition is pushing CSPs to launch often three to four new price plans each year to capture market share. As a result, nearly 35% of customers switch providers annually. This churn places is a source of increasing pressure on CSPs. At the same time, the industry is seeing sluggish revenue growth – just 2-3% in mature markets and 5-7% in emerging ones.

CSPs struggle where their pricing strategies are either too complex or less attractive than those of their rivals. Simplifying and improving pricing plans is therefore crucial for long-term success. However, the current process for launching new plans remains slow and inefficient. Typically, it takes three to four months for a new offer to reach the market. Without a clear and agile strategy, providers risk losing market share and sustained customer churn.

The solution

To address this, the ‘ODA prism: Designing the ultimate telecom plan’ Catalyst proposes an innovative platform that enables CSPs to stay ahead by dynamically generating new plans. These offers are tailored to shifting customer behavior and global market trends. As a result, CSPs can deliver more relevant pricing at speed and scale. The personalized, customer intelligence-driven approach ensures a smooth and engaging experience across the entire subscriber journey.

The Catalyst supports the Moonshot challenge of achieving ‘ODA in a box’ by enabling reusability of TM Forum Open Digital Architecture (ODA) components, TM Forum Open APIs, and proposing a new API for dynamic plan generation. The project uses the ODA framework to build a modular, cloud-native system. This transforms how CSPs design, recommend, and manage telecom plans. As a result, they can offer simple, flexible, and profitable plans that align with customer needs.

The solution harnesses advanced analytics and real-time customer insights to deliver a personalized action plan. This plan supports functions across sales, product development, fulfilment, and customer care. Consequently, it helps increase customer loyalty, boost average revenue per user (ARPU), reduce churn, and support long-term business growth.

The key features of the solution are the Dynamic Plan Builder, Plan Recommender and Next Best Action Engine, and ODA-aligned architecture. The Dynamic Plan Builder allows CSPs to quickly create and manage a wide range of pricing plans. It uses machine learning and generative AI (genAI) to support data-driven decision-making. As a result, the traditionally lengthy ‘ideate-to-launch’ process is significantly streamlined. It reduces cycle times and lowers the effort needed for market analysis, product strategy, and pricing decisions. These tasks are typically performed by product management and finance teams but are now automated for greater efficiency.

Many CSPs already use recommendation systems. However, this solution introduces a groundbreaking closed-loop feedback mechanism between the Dynamic Plan Builder and the Recommendation Engine. This integration continuously learns from customer responses and adjusts future recommendations. As a result, it significantly boosts the effectiveness of product, plan, and promotion launches. Over time, the system becomes more accurate and responsive to customer behavior.

The solution is built using TM Forum's ODA components and libraries so it remains standardized, modular, and accessible to all industry participants. This architecture also enables seamless navigation across enterprise data entities. It also ensures full compatibility with existing telecom ecosystems, making integration faster and more efficient.

Wider application and value

Kanakasubramaniam Krishnamurthi – AVP Software Development at Verizon, one of the Catalyst Champions – notes that through real-time data on usage, churn and competitor offerings, providers can design flexible profit plans that meet the evolving needs of different customer segments. The platform ensures that key financial metrics like margin rates, ARPU and lifetime value are optimized, helping to maximize revenue. And by being fully ODA-compliant, it guarantees interoperability, scalability and flexibility allowing providers, to adapt easily to evolving market demands and technological advancements.

Ayedime Amadi, Senior Manager of Enterprise Architecture & Customer Channels at MTN Group, another of the Catalyst Champions, considers the solution a breakthrough innovation for tackling high churn rates and slow plan launch cycles. Amadi notes that the solution offers a standardized yet flexible approach that operators across the industry can adopt, while also democratizing advanced analytics.

By embedding sophisticated AI and ML capabilities within an accessible ODA framework, the solution enables operators of all sizes to use advanced tools for plan design and customer engagement. It reduces time-to-market dramatically, cutting the timeframe to just two days. Moreover, it enhances customer loyalty, achieving a measurable fivefold reduction in churn rate. It drives a 10% increase in ARPU, and boosts operational efficiency by reducing manual effort by 90%.

By adhering to ODA standards and TM Forum Open APIs, the solution promotes seamless interoperability between components from different vendors, helping to break down traditional silos and support creation of best-of-breed solutions. The integration of plan creation with customer intelligence also dramatically shortens the innovation cycle and allows CSPs to test, learn, and refine offers based on real customer data. And, by contributing new components that support TMF eTOM processes and Open APIs, the solution advances industry-wide alignment and benefits the entire telecom ecosystem.