My job is to fix the UK biz – Vodafone UK CEO

While 5G dominates conversation in the telco space, it couldn’t be the only thing operators execs think about. So we asked Vodafone UK CEO Nick Jeffery what keeps him up at night.

In terms of expansion, there aren’t many success stories which can rival Vodafone. After being founded in 1985 under the name Racal-Vodafone, the telco has grown-out of the UK market to become the fifth largest telco worldwide by revenue, with a footprint encompassing more than 75 countries worldwide, in 26 of which it owns and operates its own network. Despite this success on the international stage, the UK business has suffered.

“Over the last ten years, the UK business has fallen into a state of disrepair,” said Jeffery.

It wouldn’t come as a surprise to learn Vodafone doesn’t have the best reputation in the UK. Whether it was poor customer service, dodgy signal outside of urban environments or a clunky IT system supporting the business, whichever way you looked at it the organization was not in great shape. But this is the basis of Jeffery’s mission; putting Vodafone back on its pedestal.

This mission began two years ago, and while turning a supertanker does take time, there are signs the it might be working. Net promoter score (NPS) is on the up, being +20 (anything above 0 is considered good) right now compared to +7 12 months ago and -1 in 2016. According to Ofcom, Vodafone has the highest voice coverage across the UK, while performance metrics are getting more on par with competitors. Complaints against the telco are also down significantly, and the launch of the broadband business alongside partner CityFibre looks very promising.

This turnaround is based on six building blocks. Firstly, Jeffery highlighted that performance is key. £2.5 billion has been invested on the network over the last two years, and Jeffery said an additional £2 billion has been marked for further 4G and 4.5G upgrades over the next two years. Worst case scenario, Vodafone UK aims to have a network which is on par with competition, but perfect scenario would be best-in-breed.

Secondly customer service has been a focus. This is an area we have covered before, whether it would be bringing call centres back to the UK, or offering the option of an AI customer service agent called TOBi to customers to increase efficiency. This is one area which does seem to have had a very direct impact on performance, just look at the NPS.

The third is a simple but relatively boring one. A new IT system has been put in place to improve the nuts and bolts of the organization. Initially there were some setbacks, including a £4.3 million fine for billing atrocities, however the project is running smoothly now.

The next area is the brand. While most people would have heard of Vodafone, the majority would be pretty neutral or passive when it comes to relating to it. Jeffery highlighted the objective here is to reinvigorate the Vodafone brand and make it more relatable to customers. This is certainly a bit of a change from previous brand advertising campaigns, but previous work is one explanation of why the brand is in its current position of ‘meh’.

During the years of international expansion big ticket sponsorship deals were sought. The Formula One partnership with McLaren is a perfect example of how you can generate brand awareness across multiple markets when launching new services, but it doesn’t tell much of a story. Campaigns now are focusing on developing a relationships on a more regional level. In Ireland sponsorship of the Irish Rugby team has been working well, but in the UK Above the Line campaigns have focused on Martin Freeman.

The idea is to create a brand which is relatable to the British people. As you can see from the video below, the advertisements are focused on friendly, quirky and awkward humour which is entirely relatable to almost every Brit.

The fifth area is relevance. One brand cannot be everything to everyone, so the last couple of months has seen Vodafone launch several sub-brands to reach out to more specific demographics. VOXI is for younger users, Basics does what it says on the tin and Pay As You Go One is for the more cash conscious.

The final prong of the strategy is internal. Jeffery described this area as “resetting the base of the company”, in other words, getting back to the culture which drove growth in the first place. It’s a much more nuanced part of the strategy and a much trickier one to nail.

Alongside the work to fix the dysfunctional UK business, Jeffery and his team have also launched what looks to be a pretty good FTTH broadband offering. Unlike other propositions on the market, Vodafone are not asking for any customer commitments or financial incentives to start work. Alongside CityFibre, who have already built the fibre spine in a number of cities around the UK, the pair will trench the fibre and then market the services. It’s a ‘build it and they will come’ attitude which is quite rare across the telco space.

While we might be surprised about the business venturing into the world of broadband, when you look at operations on the continent it is not an unusual position for Vodafone to be in. “Vodafone is committed to a convergence strategy,” Jeffery highlighted.

However, it will not go any further for the moment; content is not on the agenda. Jeffery highlighted that research had shown the UK consumers have a tendency to purchase mobile and broadband services as a bundle, but the way in which we consume content is changing. Set-top boxes are becoming a thing of the past as OTTs continue to dominate the content game. Jeffery said that it is not a never situation for Vodafone UK and content, but looking at how competitors are struggling to make a dent in this area does not make it an attractive bet right now.

It’s a very pragmatic approach to telecoms, which focuses on the basics of the business. Orange and T-Mobile US have both shown that focusing on the fundamentals not the bells and whistles works, and these are two telcos which are probably in one of the most attractive positions heading into the 5G era. Jeffery seems to have taken note of the success here and applying it to Vodafone UK. Simple, consistent and pragmatic; doesn’t sound like a bad idea.