National origin as a means of customer segmentation – an analysis of mobile communications users in a GCC country
| DOI | https://doi.org/10.1108/DPRG-02-2017-0009 |
| Pages | 317-331 |
| Date | 12 June 2017 |
| Published date | 12 June 2017 |
| Author | Torsten J. Gerpott,Sebastian May,Gokhan Nas |
| Subject Matter | Information & knowledge management,Information management & governance,Information policy |
National origin as a means of customer
segmentation – an analysis of mobile
communications users in a GCC country
Torsten J. Gerpott, Sebastian May and Gokhan Nas
Torsten J. Gerpott is
Professor at the Mercator
School of Management,
University of
Duisburg-Essen,
Duisburg, Germany.
Sebastian May is based
at the Mercator School of
Management, University
of Duisburg-Essen,
Duisburg, Germany.
Gokhan Nas is based at
Shakopee, Minnesota,
USA.
Abstract
Purpose –In the field of mobile communications services (MCS), it is of importance to segment MCS
users to support operators in better tailoring their offers to the needs of specific customer groups. This
paper analyzes the suitability of national origin of MCS subscribers to segment residential customers
into groups with significantly diverging usage behaviors in a sample living in one of the Gulf Cooperation
Council (GCC) member states with a large share of expatriates in its population, particularly from South
Asian countries. If MCS use patterns vary considerably between nationals, South Asian migrants and
other foreign nationalities, it makes much sense to segment customers at least into these three groups.
Design/methodology/approach –The investigation applies discriminant and regression analysis on a
sample of 4,892 residential postpaid MCS customers in a GCC country. The sample comprises
individual usage data of 2,446 national citizens and an equal number of non-nationals between July
2014 and July 2015, living in the focal country. The data set was extracted from the billing and customer
management systems of a collaborating mobile network operator (MNO).
Findings –The results imply that national origin is a highly significant predictor of individual MCS
usage. Nationals and all expatriates primarily differ in international voice and SMS usage but not in
established national MCS and mobile internet use intensity. Among expatriates, South Asians consume
more national and international voice minutes than migrants originating from other foreign nations.
Research limitations –The analysis is based on objective MCS usage data retrieved from an MNO’s
data warehouse. It lacks information on customer perceptions of the utility of various MNO service
categories and on other individual characteristics, such as the customers’ level of education or
language proficiency. To overcome this limitation, empirical research is needed that incorporates
additional objective customer descriptors as well as subjective perceptual constructs.
Practical implications –MNOs are well advised to develop service bundles and tariff portfolios
specifically designed for nationals and for different groups of expatriates.
Originality/value –The paper extends the literature on MCS usage behavior in Arab states in general
and on customer MCS usage segmentation based on individuals’ national citizenship in particular.
Keywords Customer segmentation, Expatriates, GCC countries, Mobile telecommunications,
National origin, Service usage behaviours
Paper type Research paper
1. Introduction
Currently, the markets for mobile telecommunications services in many countries of the
world are saturated to a point at which the share of mobile subscribers per inhabitant well
exceeds the 100 per cent threshold (GSMA, 2016). At the same time, mobile network
operators (MNOs) are confronted with stagnating or declining revenues, while mobile
broadband traffic increases (ITU, 2016). MNO core services are the transmission of mobile
voice (MV), text messages (short message service ⫽SMS) and data independent of a
user’s abode within their license areas. These offerings are more or less homogeneous
across providers. Therefore, they leave only little leeway for differentiation. As a Received 26 February 2017
Accepted 7 April 2017
DOI 10.1108/DPRG-02-2017-0009 VOL. 19 NO. 4 2017, pp. 317-331, © Emerald Publishing Limited, ISSN 2398-5038 DIGITAL POLICY, REGULATION AND GOVERNANCE PAGE 317
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