Developing a new tariff plan of a telecommunications company taking into account subscribers’ and investors’ preferences

Tatiana K. Bogdanova - Associate Professor, Department of Business Analytics, National Research University Higher School of EconomicsAddress: 20, Myasnitskaya Street, Moscow, 101000, Russian FederationE-mail: tanbog@hse.ruDmitry Y. Neklyudov - Data Analyst, Department of Big Data, StandardProject Ltd.; Senior Lecturer, Department of Business Analytics, National Research University Higher School of EconomicsAddress: 20, Myasnitskaya Street, Moscow, 101000, Russian FederationE-mail: dyuneklyudov@hse.ruOlga M. Uvarova - Leading Expert, Laboratory of Enterprise Competitiveness Problems Analysis, Senior Lecturer, Department of Business Analytics, National Research University Higher School of EconomicsAddress: 20, Myasnitskaya Street, Moscow, 101000, Russian FederationE-mail: ouvarova@hse.ru The market of telecommunications services is one of the most important and promising sectors of Russian economics, and its evolution has an essential impact on development strategies of all industries. In recent times, we observe a tendency for the operators’ business to shift from providing communications services to supplying integrated ICT services. A positive trend line of market growth is predicted for the coming five years. However, the problem of keeping and even expanding the subscriber base is an ongoing task of all telecom companies. One of the possible solutions to this problem is developing a rational tariff policy, which may take into consideration not only the interests of the company and its investors, but also the subscribers’ preferences. One of the main components of the tariff policy is developing new tariff plans, which meet the afore-mentioned requirements. In the paper, a new concept of tariff plan development is proposed. It is based on identifying stable groups of existing tariff plans and subscribers’ preferences that are non-linearly related with tariff plan characteristics. The proposed method is based on the concept of client lifetime value (CLV) that characterizes discounted profit received from a customer during all the time he consumes services from the company. This approach gives us an opportunity to build-up a CLV forming model, relying on subscriber’s consumption of mobile services and price characteristics of tariff plans. This seems quite important in the conditions of volatility of the high tech market and intensive changes in patterns of subscribers’ consumption of services. Within the proposed concept, an info-logical model for developing and evaluating a new tariff plan is developed. The model is based on the synthesis of neural networks and genetic algorithm. The proposed model allows us to make assessment of combinations of tariff plans’ price characteristics created by telecom company specialists, and to determine an optimal combination representing local or global maximum of CLV in the given time interval. This may be done for each subscriber’s consumption profile and for the given period. The approach gives us an opportunity to choose a tariff plan (from existing and newly created tariffs) for every subscriber cluster, which satisfies subscribers and investor preferences while providing maximum company profit.