Telecom providers have a great opportunity to use AI to better target small and medium size businesses, according to a new report from global consulting firm Bain & Company.

The report cites the example of an unnamed telco that expects to increase revenues by 3% from its top five AI-generated consumer campaigns. A similar approach could be used to increase SMB revenues, according to the report.

As Bain & Company sees it, telcos treat SMBs as a monolith, leading to one-size-fits-all campaigns based on the number of employees – an approach that doesn’t resonate with some SMB customers. For evidence, the report points to telcos’ aggregate SMB net promoter scores, which are 9 percentage points lower than their scores for large enterprise customers.

According to the researchers, “generative AI makes it feasible for telcos to create cost-effective experiences that make it feel like they actually know each business customer.”

The solution entails analyzing “vast arrays of unstructured data – from online behavior to social media patterns and beyond – to segment their medium-sized customers with unprecedented precision, speed, and scale.”

Bain references an unnamed telco that used AI to divide its consumer base into more than 60 microsegments after previously having only four broad market segments.

Once microsegments have been identified, telcos can use generative AI to quickly draft advertising copy, enabling the telcos to “create customized creative content at speed and scale.”

The same approach could work for SMBs, Bain argues.

But while many telcos see the benefits of AI, some are “laggards,” the researchers said.

Among companies with the highest revenue growth, 60% are increasing productivity by providing AI tools to their sales reps, according to the report. Among “laggard” companies, which have the slowest revenue growth, only 17% are doing so.

Source: Bain & Company

The report advises companies adopting generative AI to create a comprehensive strategy that addresses ethical practices, evaluates existing technology for needed upgrades, and integrates AI in stages.

Telco AI opportunities fall into two broad categories. One category – the one that the SMB opportunity falls into — involves using AI to benefit the telco by saving costs or increasing revenues. The other category involves gaining more revenue from increased network traffic resulting from AI – a topic explored in a recent report from Censuswide that was commissioned by Ciena.

Don’t Miss Any of Our Content

What’s happening with broadband and why is it important? Find out by subscribing to Telecompetitor’s newsletter today.

You have Successfully Subscribed!