Telstra: $1 billion strategic investment paying off but customer complaints disappoint

Telstra: $1 billion strategic investment paying off but customer complaints disappoint

The telco has achieved a lot of customer service goals it had set for itself last year but complaints to the TIO remain high.

Telstra’s $1 billion investment in nabbing market share and improving customer service has started to bear fruit but customer complaints to the Telecommunications Industry Ombudsman (TIO) remain high.

The company held its full year results announcement conference in Melbourne today.

Last year, the telco pledged the [[artnid:396678|$1 billion over 2010 and 2011 to grow market share in all product segments, ramp up customer service and to simplify the business. So far, $970 million have been spent on the initiative.

Telstra has since aggressively pursued new customers, bring out more competitive and easy to understand plans. This has seen it gain 1.66 million new mobile customers but has, however, resulted in a reduced net profit and average revenue per user.

Some of the telco’s customer service changes including the introduction of round-the-clock call centres, weekend field workers as well as a digital media business to engage customers on social networking sites.

“We are becoming easier to do business with and that is very imp in dealing with our customers,” Telstra CEO, David Thodey, said at the meeting. “The way we are constructing our offers gives good value to our customers we are still able to maintaining core financials.”

Telstra had said its target improve customer satisfaction year-on-year by six per cent. It got half way there, achieving a three per cent increase in that area. Metrics are obtained through regular customer surveys by Telstra.

The telco also set an ambitious goal last year to reduce TIO complaints by 30 per cent year-on-year. It missed the mark by a long shot, improving on complaint numbers by just six per cent. This was the worst performing area on Telstra’s strategic priority scoreboard.

A total of 22,506 customer complaints were lodged to the TIO against Telstra in the first quarter of 2011, a 12.7 per cent increase from the previous quarter.

“While it is improving, we are not where we want to be,” Thodey said. “The number of complaints coming through is a little bit higher than we wanted so we want to manage that.

But he highlighted the positives in the annual results.

The telco’s financial figures were mostly within the guidance and the company has indeed hit a lot of the goals it had set itself, particularly in grabbing market share.

Churn rates, or customer deactivation rates, are at the lowest level for Telstra in some time.

Thodey has an optimistic outlook for Telstra’s customer service future.

“I have a different view: A complaint is good because I see that as an opportunity to fix and win the customers heart in some way,” he said. “However, we don’t want the same level of complaints.”

For Telstra’s full year financial results, click here.

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