Telcos failing to use best practice to capture SMB SaaS opportunities

London, 4 May 2016: BCSG, the leading cloud services marketplace provider, today announced fresh insight that reveals the challenges telecom operators are facing in driving uptake of cloud services amongst SMB customers. Previous research conducted on behalf of BCSG suggests this market may potentially be worth $22bn to UK and US operators, yet many are failing to realise this opportunity because of the failure to implement a best practice model that considers SMBs needs.

While many telcos are struggling to generate new revenue when offering software as a service to the SMB market, other, mature SaaS vendors are experiencing significant customer growth. Good examples include cloud-based accounting software firm Xero who added two hundred thousand users in the last year alone and retail ecommerce firm Shopify who were trending towards a hundred thousand paying users in a year. Another example is Microsoft who put 3 million users on O365 in a quarter.. Spurred to investigate this dichotomy, BCSG’s analysis has identified several key reasons why telecoms operators are falling short in their ambitions. Telcos are failing to:

• Properly understand the customer and their needs. In a market where the growth comes from mass adoption, a more considered and targeted approach is required which segments the customer base and designs marketing activity around their specific requirements
• Develop effective customer journeys. Ensure good awareness and understanding of the needs and solutions before sale through to supporting and educating the customer on how to achieve success with the products afterwards
• Make sure the reasons why a SMB should purchase from them are clear. Cloud products and services are often treated as silos, and the true value of joined up digital solutions are not communicated to the customer.
• Use appropriate tools to engage the customer, including making use of marketing automation and analytics tools Build and launch their services in the right way, often preferring a “big bang” all customer, all products, and all channels approach, rather than launching more instructive small, test, learn and scale initiatives.

“Multiple reports and research – including our own – shows there’s huge, latent opportunity for telecoms operators to generate substantial new revenues from cloud services provision. While telcos have had some success selling to tech-savvy ‘early adopters’, SMBs in the mass market are less willing and able to find their own way,” said Alan Marsh, Product and Marketing Director at BCSG. “Our analysis shows that low sales amongst mass market customers comes from failing to build awareness and appreciation of value effectively in the early stages of customer engagement. Understanding and building engaging, multi-channel customer journeys that span the full customer lifecycle will be key to unlocking the potential from this sector.”

Further analysis by BCSG shows that a number of key components would substantially improve telcos’ ability to address the SMB mass market. These include elements such as microsites to host educational content and support for available services, customer analytics, CRM and marketing automation tools, and intuitive webstores to make the selection of services and registration easy

In response to this analysis, BCSG has launched its next generation Cloud Management Platform which gives telecoms operators the power and flexibility to develop and deliver cloud service proposition across multiple resellers, geographies and channels rapidly. Crucially, the platform includes a set of tools that enable telcos to deliver customized customer journeys that tailor the experience to what is known about the customer.

Based on powerful data warehouse that holds customer profile information, the platform’s customer lifecycle management capabilities enable operators to build a catalogue of services, and then tailor the customer engagement to each customer. Native integration to services like marketing automation software Marketo and Salesforce mean that communication can be personalised to customer needs, and intelligent content management means it is possible to ensure the cloud marketplace displays content relevant to the user. The platform’s modular design allows telcos to choose whether to implement the entire platform to be used on a standalone basis, or select specific functions to implement and retain others in-house, for example customer support and billing.

“Addressing SMBs more effectively boils down to presenting the right content at the right point of the customer journey, and enabling more easy, transparent mechanisms to engage. It might sound complex but the lessons are there to learn and technology is available to allow telcos to capture the market opportunity,” concluded Marsh.

For more on our business cloud service brokerage and to discover further insights on telecoms cloud services for telcos, have a look around our resources section