SaaS for SMBs: The main meal, not the side salad

Door to new opportunityWe know that telcos are well-placed to sell cloud services to small and medium-sized businesses. Even if they don’t always know it yet, the business customers they provide telecoms services to need to embrace digital services to succeed, and telecoms providers are trusted to deliver technology that meets their stated needs. Cloud is very much at the forefront of most telcos’ thinking, in terms of how it can be used to serve their own operational requirements, but also as a delivery mechanism and opportunity for providing business customers with a range of additional services. They are increasingly offering a catalogue of cloud applications that can provide business customers with efficient tools to help run their organisations without the cost and complexity of buying, running and maintaining software from myriad, discrete providers.

But while this is good in theory, the practice is somewhat different. In the last two to three years, there has been a lot of talk about the opportunity that exists, but for most this opportunity has not resulted in a significant new revenue stream. And building new revenue streams are vital for operators.

Voice and data revenues are declining so portfolio diversity is necessary if operators are to remain profitable. Providing cloud services remains one of the most obvious routes to diversity – which makes its current stagnation a bit of a worry.

Through a number of interviews and workshops, BCSG has identified some of the key factors that have stopped telcos from making the most of the opportunity.

Getting it wrong

Unfortunately, selling cloud services as “just another add on” doesn’t work as it might with other services for small businesses. The telco may be a natural provider of these services, but to reach the mass market customers need to be educated on how the solutions can bring value and why the telco should be considered as the vendor – it is, after all, a service of the type that the business may have previously acquired from elsewhere.

Many telcos are failing to making it clear why businesses should buy from them – the value of these joined-up digital solutions (alongside existing services, for example a device, a 4G connection and the ability to access their business files on the move) are not being communicated to the customer.

Additionally, many telcos are not communicating in an effective way, preferring a ‘big bang, product push’ approach to marketing – all products, all channels, all customers, all at once. This untargeted approach is not winning business.

Getting it right

To be successful, telcos need to understand their own customers better. What would they most benefit from? How well do they understand their own needs? How can they get a busy business owner to stop and take time to consider how to become more efficient with a new application? How could the business grow as a result of a new cloud marketing solution?

Without understanding how to take a customer on the journey, knowing what education they will need, and having a clear idea of the barriers they will face, customers won’t adopt the services or reach the point where they are getting good value, a must for any SaaS product. Developing this customer understanding enables providers to deliver a targeted approach that personalises the engagement. Once that baseline of customer understanding is established, telcos can begin the education process that underpins a path to purchase and ongoing use. At this point, targeted marketing must take customers on a journey that builds understanding of, comfort with, and desire for the services available. Telcos could help businesses understand, for example, how a mobile device can be combined with cloud-based software that creates online forms to save time completing admin outside of working hours or how a tablet and email marketing app can be used together to create the next campaign to find new customers in dead time waiting for a flight in an airport.

Working with the software vendors (ISVs) to provide insight about customers and their products is critical – they are, after all, the experts on their product. ISVs already sell their products through a number of channels and so should have the resources and expertise on hand to help with the sales process. There is no need to build something from scratch. While it might seem obvious, our analysis shows these key elements of the customer journey and marketing process are rarely followed.

Finally, once the understanding, education, customer journey and value is understood, telcos need to execute effectively. This means using the right marketing tools in the right way to reach the right customers at the right time. Taking a measured, staged approach to rolling out new services, using each opportunity to test, learn and scale, reduces risk and helps to avoid big bang launch, followed by re-launch 6 months later as the first approach hasn’t worked.

A lot of the steps and processes needed to create the right customer journeys can easily be automated using the right tools, such as marketing automation. These tools are also essential for the measurement and analysis of performance that helps to foster further learning about the customer.

Telcos have been told that “the time is now” for cloud services for several years, but up until now, with some exceptions, cloud services has remained a lacklustre business stream for telcos. Making cloud services the centre of attention, rather than an afterthought tacked on at the end of a sales call, will help telcos capture that all important cloud opportunity.

Written by Alan Marsh, Product and Marketing Director at BCSG