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VoIP Industry Getting 'Busy Signals' from Small / Medium Businesses (SMBs)BOSTON, Sept. 20 /PRNewswire/ -- Most of the 1.8 million small and medium businesses (SMBs) in the U.S. have not yet answered the call for emerging VoIP, as new and traditional telecommunications, data and equipment providers struggle to differentiate their offers, and create compelling price and product strategies that ring true to SMB owners. The major findings of the study demonstrate that the SMB market is still wide open for VoIP players who want to seize this growing segment of the industry: Key Findings * There is more work to be done in educating the SMB market about VoIP. While there is general familiarity with VoIP (24% and 51% are "somewhat familiar" or "familiar"), a striking 25% of SMB companies are "unfamiliar" with VoIP and its advantages. * Current pricing and service offers will likely create a commodity spiral in the next 18 months -- offering breakout opportunities for companies who shift their positioning from a Return-on-Investment (ROI) pitch to Total Cost of Ownership (TCO) models. Lowering monthly recurring charges is a primary driver for most of this market (74% indicate MRC as "compelling" or "very compelling"), yet lowering TCO and easing administrative costs were almost equally important (73% and 68% respectively) for SMB decision makers. * The SMB segment is wide open for traditional or new players to capture the market. Respondents were evenly divided among traditional and non- traditional telcos, ISPs, cable operators and equipment providers as to who they might turn to for VoIP service. Thirteen percent weren't sure who to turn to for VoIP solutions. * Traditional telcos, ISPs, and cable operators who have already deployed VoIP aren't succeeding in the high-touch, high-cost sales process needed to convert this market. They may need to turn to channel partners who have stronger knowledge of the product and can offer a more "consultative selling" process. * There is a growing opportunity in the SMB market for providers to offer related services such as Web collaboration tools, email hosting, and high-speed data services as part of new VoIP offerings. * VoIP delivery models -- premise-based or managed services -- are not well understood by the SMB market. More than 50% of the respondents weren't aware of the different internal and external delivery options available to them. "The small and medium business market is that gem the entire VoIP industry is chasing, yet this segment isn't well educated about the benefits of VoIP," said John Macario, president of Savatar. "VoIP providers are struggling to reposition their product, services and pricing for SMBs, and are looking at some dramatic changes in their sales processes, service offerings and pricing structures to reach and serve this market." One element of the study was an in-depth analysis of product, pricing and service offerings, as well as an examination of the sales processes used by leading VoIP providers. The analysis revealed that traditional telemarketing and high-touch sales meetings are either not working or not sustainable in this market. "The data shows that SMB decision markers are pretty sophisticated and need a more consultative sales process, not just a sales call touting a bunch of features," said Richard Grange, president and CEO of New Global Telecom (http://www.ngt.com/), one of the sponsors of this study. "We see the VoIP industry turning to channel partners who can help penetrate this market." This study, unveiled at the Fall VON 2005 conference, offers one of the first detailed views of the SMB VoIP market and the product, positioning and total cost-of-ownership factors that will drive this industry segment. About Savatar Savatar is a management consulting company that helps telecommunications clients succeed in selling VoIP solutions to the small and medium business (SMB) market. The firm has worked with large carriers, wholesalers, equipment providers, and software developers to define product, establish sales channels, and optimize sales techniques for VoIP products in the SMB market. For more information, please visit http://www.savatar.com/. Note to Editors: A media summary of this research is available from Savatar by calling Kim Novino at Bridgeman Communications at 617-742-7270 or by email ([email protected]). Interviews with the study's authors, John Macario and Suke Jawanda of Savatar, as well as the study's principal sponsors, can also be arranged. Savatar CONTACT: Kim Novino of Bridgeman Communications, +1-617-742-7270,[email protected] Web Site: http://www.savatar.com/ |