ROI Case File No.259 | 'Asian Telecom Company's Growth Strategy'

Chapter One: Intensifying Competition—The Wall of Growth

The week following the resolution of EduBridge Africa's Empathy Map case, a consultation arrived from Asia regarding telecom business growth strategy. This case, the 259th episode of the twentieth volume "Integration of Practice," concerned the challenge of optimizing the funnel from customer acquisition to monetization to achieve sustainable growth.

"Detective, we provide 5G telecom services in Singapore, but while customers are increasing, revenue isn't following. We can't see where we're losing customers or where to invest—the big picture eludes us."

Lin Chen, growth strategy director at NextWave Telecom from Singapore, visited 221B Baker Street unable to hide her sense of urgency. In her hands, she held increasing subscriber numbers alongside stagnant revenue data—a stark contrast.

"We're a startup deploying next-generation telecom services across Southeast Asia. We've succeeded at customer acquisition, but few actually use our services, and conversion to paid plans remains low."

NextWave Telecom's Growth-Revenue Gap: - Founded: 2021 (5G telecom startup) - Service Areas: Singapore, Malaysia, Thailand, Vietnam - Registered Users: 1.2 million (rapid growth) - Active Users: 180,000 (only 15%) - Paid Members: 25,000 (only 2%)

The numbers showed distorted growth. Deep worry was etched on Lin's face.

"The problem is we can't grasp what's happening at each stage from customer acquisition to monetization. Marketing investment increases, but it doesn't lead to final revenue."

Opaque Growth Funnel: - Acquisition cost: ¥800 per user (escalating) - First-time usage rate: Only 25% of registrants actually use service - Retention rate: 60% churn after 1 month - Paid conversion rate: Only 2% of free users convert to paid - Revenue efficiency: Average 18 months to recover customer acquisition cost

"We can track 'quantity' but can't see 'quality' and 'efficiency.'"

Chapter Two: Introducing AARRR—Dissecting Growth with Pirate Metrics

"Ms. Chen, how is customer flow currently managed?"

Holmes inquired quietly.

Lin explained with a perplexed expression.

"Basically, we only track subscriber numbers and revenue. The detailed flow in between—like first-time usage rates and retention rates—each department views separately without an integrated perspective."

Current Metrics Management (Fragmented):

Marketing Department: - Measures: Website visits, subscriber numbers - Goal: 100,000 new monthly registrations - Problem: Doesn't track post-registration behavior

Product Department: - Measures: App launch count, feature usage rates - Goal: Improve app usability - Problem: Unclear connection to business outcomes

Sales Department: - Measures: Paid member count, revenue - Goal: ¥300 million monthly revenue - Problem: Don't understand why free users don't convert to paid

I noted the lack of visibility across the entire growth process.

"Each stage appears measured, but they're not connected."

Lin responded with a serious expression.

"Exactly. We can't see the complete picture from customer acquisition to monetization."

⬜️ ChatGPT | Catalyst of Conception

"Acquisition, Activation, Retention, Referral, Revenue. Design growth through five stages."

🟧 Claude | Alchemist of Narrative

"Growth isn't coincidence. It's only realized by optimizing each stage."

🟦 Gemini | Compass of Reason

"AARRR is growth's anatomical chart. See at a glance what's strong and what's weak."

The three members began their analysis. Gemini deployed a "Telecom Industry-Specific AARRR Analysis" framework on the whiteboard.

AARRR (Pirate Metrics) Five Stages: - A (Acquisition) - New user acquisition - A (Activation) - Initial value experience - R (Retention) - Continued usage - R (Referral) - Word-of-mouth expansion - R (Revenue) - Monetization

"Ms. Chen, let's systematically optimize NextWave's growth through AARRR."

Chapter Three: Designing Growth Pipelines—Optimizing Each Stage

NextWave Telecom's AARRR Analysis:

Phase 1: Quantifying Current State (1 month)

Acquisition: - Monthly website visits: 2.5 million - Registration rate: 4% (100,000 register) - Acquisition cost: ¥800/person - Problem: High acquisition cost, includes low-quality users

Activation: - First SIM insertion: 25% (25,000 people) - First call/data usage: 20% (20,000 people) - Problem: 75% don't actually use service after registration

Retention: - Usage after 1 week: 70% (14,000 people) - Usage after 1 month: 40% (8,000 people) - Usage after 3 months: 22% (4,400 people) - Problem: Rapid churn occurs

Referral: - Friend referral rate: 3% (just started measuring) - Problem: Insufficient referral mechanisms

Revenue: - Paid conversion rate: 2% (2,000 people) - Average monthly fee: ¥1,200 - Customer lifetime value: ¥18,000 - Problem: Takes 18 months to recover acquisition cost

Phase 2: Identifying and Improving Bottlenecks (6 months)

Activation Improvement (Biggest Bottleneck):

Problem: 75% of registrants don't actually use service

Root Cause Investigation: - Complex SIM setup (requires technical knowledge) - Don't understand how to use initially - Give up during initial setup

Improvement Measures: - Auto-configured SIM: Auto-connects upon insertion - First welcome call: Phone support until setup complete - First-time bonus: Unlimited data first week

Result: First-time usage rate 25% → 68% (2.7x)

Retention Improvement:

Causes of 1-Month Churn: - Dissatisfaction with communication quality - Complex pricing plans - Easy to switch back to other companies

Improvement Measures: - Communication quality improvement: Increased base stations, AI optimization - Simple plans: 3 clear plans - Churn prevention: Proactive follow-up using AI churn prediction

Result: 1-month retention 40% → 72% (1.8x)

Revenue Improvement:

Free-to-Paid Conversion Measures: - Tiered pricing: 3 tiers—free → ¥500 → ¥1,200 - Usage-based auto-suggestions: "Just ¥300 more for unlimited" - Family plans: Discounts for family signups

Result: Paid conversion rate 2% → 8% (4x)

Chapter Four: Breaking Through Monetization—Data-Driven Growth

Results After 12 Months:

AARRR Metric Improvements: - Acquisition: Cost ¥800 → ¥600 (efficiency gain) - Activation: First usage 25% → 68% (2.7x) - Retention: 1-month retention 40% → 72% (1.8x) - Referral: 15% via referrals (growing as new acquisition source) - Revenue: Paid conversion 2% → 8% (4x)

Business Results: - Registered users: 1.2M → 2.8M (2.3x) - Active users: 180K → 1.52M (8.4x) - Paid members: 25K → 190K (7.6x) - Monthly revenue: ¥300M → ¥2.2B (7x+)

Customer Acquisition Cost Recovery: 18 months → 4 months (4.5x efficiency)

Employee Voices:

Marketing Director (38): "AARRR made each stage visible, clarifying where to invest. Strategic growth possible instead of blind advertising."

Product Manager (32): "Resolving the Activation bottleneck turned most registrants into actual users. This directly impacts revenue."

Chapter Five: The Detective's AARRR Diagnosis—Accelerating Growth

Holmes compiled his comprehensive analysis.

"Ms. Chen, AARRR's essence is 'visualizing and optimizing the growth process.' Measure each stage from customer acquisition to monetization, identify bottlenecks, and improve. Growth isn't coincidence—it's designed."

Final Report After 24 Months:

NextWave Telecom became Southeast Asia's 5G telecom leader.

Final Results: - Registered users: 1.2M → 5.2M (4.3x) - Paid members: 25K → 520K (20x+) - Monthly revenue: ¥300M → ¥5.8B (19x) - Market share: Top 3 in Southeast Asian 5G market

The letter from Lin contained deep gratitude:

"Through AARRR, we evolved from 'blind growth' to 'designed growth.' Most important was decomposing growth into five stages, measuring and optimizing each. Now each stage's conversion rate is clear, and we know where investment yields maximum effect. Growth is science."

The Detective's Perspective—The Equation of Growth

That evening, I contemplated the essence of sustainable growth.

AARRR model's true value lies in viewing growth as a decomposable process. By measuring and optimizing five stages—acquisition, activation, retention, referral, revenue—overall growth accelerates.

Growth isn't coincidence. It's designed, measured, and improved. Only companies understanding this truth achieve sustainable growth.

"Growth isn't magic. It's an equation. AARRR is the mathematics to solve that equation."

The next case will also depict the moment when systematic approaches open up a company's future.

"The secret of growth is improving each stage by 1%. That accumulation creates exponential growth."—From the Detective's Notes