This short video provides an overview of a research methodology one can use to measure the possible annual revenue a telecommunications company might expect from an IPTV solution within a given market.

The video provides some background, two sample analyses that demonstrate actionable information, and an overview of the research methodology along with schedule and base costs.

If you are your team are trying to decide if now is the time for an IPTV solution, this might be the most important 5 minute video you can watch.

Download the Presentation (Right-Click & “Save As”; PDF; 1.05mb)
Download the Video (Right-Click & “Save As”; Zipped MP4; 6.03mb)

Video Highlights/ Speaking Points

• How to know how many current customers might switch to your service and what they might possibly pay.
• There are two key pieces of information required to make an informed IPTV decision: 1) knowing the size and value of your potential IPTV market, and 2) understanding what portion of that market would move their business to you.
• A three step solution: 1) Identify prevalence of pay-TV (i.e., cable) in your market, 2) Estimate current annual revenue generated from pay-TV services for current providers, and 3) Uncover the potential revenue that would be available for you.
• This is not a marketing strategy or retention research methodology.  It is an approach that will do two specific things very well.  It’ll tell you how big your potential IPTV market is and what it’s worth to you.
• In this example, a rural telecommunications provider’s market may have 3,358 household currently paying for television services at a rate of 2.23 million dollars per year.  A new IPTV offering in this this hypothetical market could expect upwards of $454,383 in annual incremental revenue.

There is another side.  It’s the side that recognizes that you have a business analytic need, but not the technical expertise or time to learn a new business application.  Let’s bring the whole down thing down to earth.

Business analytics is all about organizing the past to understand what the future might hold.  This is because there exist patterns in the history of our business that if we can understand, we can apply to our future decision making.  Too many business decisions are made based on a manager’s “gut”.

With the application of some simple business analytic principles you can apply historical evidence to the decision making process (then check your “gut” and see if it still feels right).

To start to get a hold of the power of business analytics, you need to see that there are five universal truths:

(Note that these “truths” were adopted from the transcripts from of movie “Pi“. )

1. Anything can be measured.
   Anything.  We’re not using the term loosely here.  Truly anything can be measured.  You might say this is impossible.  That there are things so abstract that this simply isn’t possible.  Take “perspective” for example.  You can’t measure something so dynamic as a consumer’s perspective of your brand.

   Sure you can.  So long as you define it in a measurable way.  The trick to measuring everything is how you define anything.  We define things in their context.  So let’s say you are looking to understand the level to which consumers view your brand as the high-quality option.  If you defined quality as someone’s level of agreement to the phrase, “Brand XYZ is the highest quality option available to me today.” then you have a method of measurement.  Sure there are limitations and other things at play, but by defining the concept in a relevant and measurable way you’ve given yourself a starting point.  Surely you can build from there.

2. All recorded measurements can be graphed.
   You simply apply the variable of time.  If I’m measuring customer loyalty with a survey, all I need to do is take my loyalty score at different points in time and chart it.  With the month along the bottom of a chart (x-axis) and the score along they side (y-axis) you can get a clear graph of customer loyalty.
3. When graphing anything, patterns emerge.
   This is where, sometimes you need to lean on statistical techniques to help you uncover the pattern, but it is always there.  The alternative to a pattern is chaos and chaos simply doesn’t exist among the actions of people in groups.  (This is something I’ll back up in a later post.)  As humans we move in patterns and these pattens will come through when you’re measuring any type of human behavior over time.
4. Patterns hold the power of predictability.
   This is due to the very nature of patterns to begin with.  You simply extend the variable of time and apply the average measure.  Again, there are some fancy techniques to be applied here to help you control for things that influence the historical average (e.g., seasonality, marketing initiatives, competitor activity, roll-backs, etc.).  However, any pattern can be extended beyond its current end point to reveal the future.
5. Therefore, the future can be accurately predicted.
   And there-in lies the power of business analytics.  What happened in the past is the past.  There is nothing we can do about it.  The future represents only opportunity and the more we know what to expect, the more we can position ourselves, our brands, and our Client’s brands to be successful in that future.

The business analytic basics are truly powerful to business decision making and planning.  Too long it has been the domain of expert analysts and software training experts.  At Portland Marketing Analytics we work to bring the rationale of business analytics to the non-technical business professional.  This gives you the power to use these tools as you see fit.  When it comes to the heavy lifting you can always lean on the statisticians and software experts.  However, you’re the one who has to make the final business decision.