A few years ago, voice over IP (VoIP) sounded like a great concept on paper. Today VoIP is no longer just a concept, but a firm reality with millions of residential and business customers, and the numbers are growing. In fact, according to Atlantic-ACM, consumer VoIP has grown from about 15,000 users at the end of 2003 to approximately 1.2 million users at the end of 2004. VoIP providers got a huge assist in the form of government deregulation and a growing number of customers who are accepting the idea of gathering all their information (voice, video, and data) over an IP network rather than traditional mediums.
With barriers to VoIP being lifted, a path is cleared for service providers to promote the technology and its wide range of benefits to customers of all sizes. In fact, Yankee Group estimated that 20 percent of all new business phone systems installed in the United States last year utilized some type of VoIP technology.
One of the benefits of VoIP is that it goes hand-in-hand with other services such as e-mail, domain name registration, digital rights management (pay-per-view), streaming video, and other services that add value for the customer and revenue for the provider. Services can be converged and bundled to offer attractive packages to potential customers simply by virtue of the fact that instead of several invoices, they now have one vendor and one bill to deal with each month. But as competition for customers increases, so does the need to build a broad resale channel sales force that can contribute to creating a large end-user client base.
Enter channel marketing. For IP service providers, channel marketing includes the use of partners, sometimes known as channels who market directly to the customer as consultants, re-packagers, agents, or resellers. While direct sales is the highest dollar-cost approach to selling and delivering services, indirect channels can often sell VoIP services most efficiently.
The new channel marketing model now includes resellers that identify with a specific market or ethnic audience and has the advantage of being able to customize their messages and service bundles to fit their targeted market. Other resellers may have expertise in the residential market and still others focus on specific types of businesses. The vast assortment of service resellers enables the wholesaler/provider to market to an audience they might not otherwise be able to access through traditional methods.
With all the advantages offered by utilizing the channel marketing model, wholesalers and providers are then tasked with the burden of trying to find a method of effectively bundling and delivering those services to their resellers. To do this, wholesalers/providers need a well constructed set of marketing support tools to help the sales effort, including those that track commissions, offer reliable reporting and organizes sales and marketing information. Again, according to Atlantic-ACM, resellers are also looking to streamline their service offerings with Web-based sign up, online billing, and online customer service. The requirements of both the wholesaler/provider and the reseller can be fulfilled with new generation operations systems and software (OSS).
Known mostly as billing and provisioning software, many OSS applications have the ability to enable bundled services and offer online signup and activation. Many providers may already have legacy OSS software that has these features built-in, but are not currently using them. Other systems have these capabilities, but require a low-cost module to enable these features.
Once these features are put into play, resellers can take advantage of them through a branded portal. Branded portals map back to the provider, but can display the look and logo of the reseller. A transparently branded portal can generally be configured in a matter of hours and allows the reseller to roll out and sell services within a day. The roll-out process may take a little extra time if the reseller wants to load their entire customer base and pricing structure into the providers OSS platform, however, a Web-based application will allow them to upload their information and make edits from any Web browser.
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In addition to bundling VoIP services such as find me/follow me, call screening, and unified messaging, OSS allows wholesalers/providers the ability to bundle non-VoIP services like the previously mentioned e-mail, domain name registration, streaming video, and others. Most OSS systems can enable bundled services that are either outsourced or internally hosted. This allows resellers to offer end-users an even greater number of services with the specific service bundles that fit their market demand. Also, a greater number of services tend to make the bundle “sticky” in that customers now deal with a single provider for all services rather than different providers for each service.
In addition to enabling service bundles, Web-based OSS offers a convenient way for resellers to sell services that are provisioned and activated online, allowing them to sell 24/7 rather than from just 9 to 5 and without regard to time zones. Online billing also allows end-users the opportunity to view their account from any browser and the OSS platform can be configured to provide up-to-the-minute account information — especially important for users of services with usage sensitive rates or time increments.
Resellers can also take advantage of online customer care features offered by many OSS systems. Features such as online service tickets and customer discussion boards allow end-users the ability to service many problem issues on their own without burdening either the reseller or the wholesaler/provider with commonly asked questions or with uncomplicated maintenance issues.
While OSS brings a wealth of features that the reseller can use to their full advantage, the wholesaler/provider can utilize the commission calculations and reporting elements that allow them to track sales and reseller performance. OSS systems that feature Online Analytical Processing (OLAP) compliance are generally capable of providing this functionality which vastly improves the wholesaler/provider’s ability to track data, maintain information and make educated decisions based on reseller activities. OLAP tools provide analysis of data stored in the OSS database and enable users to analyze different segments of multidimensional data which make up the OSS functionality. For example, OLAP can provide time series and trend analysis views of the reseller’s sales activities.
Once sales are made, both the reseller and the wholesaler/provider want payment for their services — that’s where payment gateways come in. Payment gateway modules may come inherent to the OSS system, but are most often purchased separately. It is the payment gateways that enable end-users to pay for IP services with a credit card and deposit the funds in the provider/wholesaler’s account. Payment gateways operate by batching transactions from the OSS and then sending the batched data to the payment processor for verification and authorization. The wholesaler/provider arranges with a banking institution for merchant ID, account number, and a password, all of which is transacted between the payment processor and banking institution.
The payment is then deposited into the wholesaler/provider’s account. Integrating the OSS with the payment gateway AND automatically calculating commissions makes financial arrangements with resellers a far less painful process.
As VoIP technology gains acceptance and providers become more competitive in the marketplace, the need for a fully Web-enabled OSS system that can enable VoIP features and functionality will become a major factor in ramping services through resellers quickly and effectively. While there are hundreds of OSS systems that enable VoIP services, either finding the right system or utilizing the full functionality of a legacy system is clearly becoming the make or break of a successful channel strategy. IT
Suzanne Finch is director of marketing communications at Rodopi Software. For more information, please visit www.rodopi.com.
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