& cplSiteName &

Why Serving Big Businesses Is Different

Mark Schweitzer
8/3/2016
100%
0%

In the first article in this four-part series, we reviewed cable's business services success in the small business market, and the drivers underlying the industry's more recent push into the mid-market and enterprise spaces. Now, in this second part, we focus on the profile of customers in the mid-market and enterprise segments, a vertical-based sub-segmentation approach and high-level customer needs that cable operators must consider to boost their market share.

First, we review the customer profile of larger business customers and how this impacts various areas, including customer complexity, sales and marketing, and specialization.

1. Greater complexity
Although mid-market and enterprise businesses (20 or more employees) account for only about 12% of US firms, they account for nearly one third of business locations. Because telecommunications complexity increases with more employees and locations, there is an opportunity for greater revenue through the specialization of solutions.

Source: US Census
Source: US Census

2. Different sales and marketing methods
Although there are fewer decision-makers to target in the mid-market and enterprise segments, the sales and marketing strategy differs significantly from the "pull/demand" approach used in the small business space. Rather than utilizing small business sales channels like telesales, online and retail, service providers employ direct sales, value-added resellers (VARs) and system integrators to reach mid-market and enterprise decision-makers. For marketing, tactics that support sales efforts such as events, webinars, content and trade publications replace the direct response and traditional media more prevalent for small firms.

3. More specialization
Third, while there are fewer total decision-makers and firms to reach, telecom needs become more specialized and unique as business size increases. Successful enterprise telecom providers have developed offerings, solutions and services that address unique customer needs at the vertical industry level.

Although customer needs are constantly evolving with technology and market dynamics, many providers use vertical segmentation to guide marketing, sales and service. Research and data provide insights into customer needs and the buying process by vertical industry. Where there are significant distinctions between verticals, a service provider may justify investment in vertical-specific sales, marketing and custom product solutions.

The table below shows a common MSO (and telco) approach to segmentation and special considerations within segments. Note that carrier & wholesale is a significant and growing area of opportunity for cable operators, with varying approaches to both carrier and mobile network operator (MNO) audiences.

Dedicating sales teams to verticals is the ultimate expression of commitment from a service provider. Establishing a dedicated sales team requires hard investments to fund the team and its management chain, as well as the soft costs of recruiting sales professionals with the experience, expertise and customer networks to deliver new business. Although many telcos have dedicated sales teams for a number of vertical industries, cable operators are less likely to have taken this step (with the exception of the E-Rate and government segments).

How do mid-market and enterprise needs differ from small business? This question has been the subject of much cable and telco research. As the chart below suggests, mid-market and enterprise organizations differ significantly from small business in terms of needs, products and solutions, decision makers and influencers, and the buying journey.

These distinctions in customer needs, decision-makers and influencers, and the buying journey are critically important to cable operators. They provide a blueprint for the development of MSO capabilities across dimensions, ranging from organization design to products and solutions to marketing and sales. Having a better understanding of these fertile customer segments will provide MSOs with the opportunity to learn from existing approaches to better address the most compelling pain points and opportunities.

The next article in this series will define the unique needs and buying journeys of mid-market and enterprise commercial customers. We will cover each consideration and advise successful approaches to address this market opportunity. (See How Cable Means Business About Business.)

— Mark Schweitzer, Partner, CMG Partners

(3)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
jangkrikmewah
50%
50%
jangkrikmewah,
User Rank: Light Beer
4/19/2017 | 4:35:45 PM
jangkrik
This is great, you are good, i like your post and i still waiting our next post Bandar Ceme
CathyRoberson
50%
50%
CathyRoberson,
User Rank: Light Beer
8/9/2016 | 6:43:33 AM
Absolutely in agreement!
There are companies that change the world, and there are companies that help those companies, and I dont think one can exist without the other. Tradition and brick and mortar companies are essential.
Duh!
100%
0%
Duh!,
User Rank: Light Sabre
8/4/2016 | 3:13:58 PM
Bandwidth by segment
All of this should be obvious -- but isn't.  It's too common in Tier 2, Tier 3 and community broadband world to think of "business" as a monolithic customer base.  Distilling the diversity of businesses into a single chart is a good start for fostering better understanding and therefore better decision making.

One other consideration that should be addressed is bandwidth requirements by segment.  For example, the retail segment (with exceptions) tends to require relatively little bandwidth; applications like POS, and security don't generate a lot of data.  On the other hand,  the bar and restaurant segment and hospitality segment tend to be video intensive, and therefore need "fat pipes" with multicast capabilities downstream. In operators' business plans, these differences should drive requirements, capacity planning and other CAPEX contributors, as well as pricing and revenue projections. "One size fits all" may work as a model for consumers, but not for business.
More Blogs from Column
The technical challenges of going wireless aren't small.
As new ambitions demand next-gen support, IBB has identified three primary ways that CSPs can upgrade their OSS/BSS systems to deliver that support.
To succeed at virtualization, operators need to realize that standards bodies, open source initiatives and vendor ecosystems aren't going to help.
MANO in the NFV space will be put through its paces at Light Reading's fourth annual Big Communications Event in Austin next month.
Take control of your career and confront stereotypes, overcome biases and achieve the full measure of success to which your talent, hard work and ambition entitle you.
From The Founder
Either we perform a complete 'factory reset' on the way the telecom industry creates and deploys virtualization, or we face the consequences.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
Women in Comms Introduction Videos
How Diversity Helps Comcast Mirror Its Customer Base

4|26|17   |   2:55   |   (0) comments


Diversity brings innovation, creative ideas and a way to reflect the broad spectrum of your customer base, Comcast Director of Customer Experience Jenelle Champlin says.
LRTV Huawei Video Resource Center
Mobile Operators & Video

4|25|17   |     |   (0) comments


Ovum's Ed Barton discusses the latest mobile operator strategies for mobile video.
LRTV Custom TV
Infinera Introduces Instant Network

4|20|17   |     |   (1) comment


Mike Capuano, vice president of marketing at Infinera, discusses the advancement from Instant Bandwidth to new Instant Network capabilities, which include Bandwidth License Pools, Moveable Licenses and Automated Capacity Engineering (ACE).
Women in Comms Introduction Videos
Vodafone's Eubank on Sponsors, Mentors & Moving On Up

4|19|17   |   4:25   |   (0) comments


Vodafone America's Head of Operations Kimberly Eubank breaks down the difference between a sponsor and a mentor and shares why both made a big difference in her career.
LRTV Custom TV
NYC Auto Show: Are We Smart Yet?

4|18|17   |     |   (0) comments


The auto industry is facing some big transformations as electric vehicles, autonomous technology and connected cars are seen as the future of the industry. During the much-anticipated NY international auto show, there was an emergence of new technology and mobility service on the show floor. Aside from performance, brands like Lincoln, Hyundai, Honda, Mercedes and ...
LRTV Huawei Video Resource Center
The Impact of Video

4|18|17   |     |   (0) comments


David Mercer from Strategy Analytics discusses the impact of video on current strategies.
LRTV Custom TV
Pardeep Kohli Discusses Network Transformation & the Market Opportunity for the 'New' Mavenir Systems

4|13|17   |     |   (0) comments


In a brief discussion at MWC 2017, Heavy Reading analyst Adi Kishore talks to Pardeep Kohli, CEO, Mavenir Systems about the creation of the 'new Mavenir' and some of the key challenges facing operators in today's market. A key theme of the discussion centers around operator need for software-only, virtualized solutions and how they will need to adapt to ...
Women in Comms Introduction Videos
Tech Maverick Shares Her Tips for Gender Inclusivity

4|12|17   |   7:28   |   (0) comments


Wendy Hall Bohling, a corporate escapee, author and gender exclusivity consultant, tells her story of sexism, bias and progress along the road to gender equality in the workforce.
LRTV Huawei Video Resource Center
Huawei at MWC 2017

4|11|17   |     |   (0) comments


At Mobile World Congress 2017, the biggest mobile industry gathering of the year, Huawei showcased its new innovations and solutions with the theme "Open Road," which focuses on cloud, 5G, operation transformation, videos and consumer-oriented products. Its campaign has been recognized by three awards given by GSMA.
LRTV Custom TV
China Telecom NFV Infrastructure on RSD

4|6|17   |     |   (0) comments


Lynn Comp, senior director of market development of Intel, is joined by Chong Zhang, storage engineer at Inspur and Ou Li Yan, architect for technology strategies of China Telecom, for a discussion of what NFV brings.
LRTV Custom TV
Nokia's IMPACT Software Demo

4|6|17   |     |   (0) comments


Khamis Abulgubein of IoT market development at Nokia demonstrates IMPACT (intelligent management platform for all connected things), a software solution with a horizontal approach to managing any device on any application.
LRTV Custom TV
Nokia Introduces Virtual Service Router for More Rapid Service

4|6|17   |     |   (0) comments


James Cumming, product line manager for virtualized service routers at Nokia, demonstrates how the virtual router based off the Nokia ecosystem changes the network function experience.
Upcoming Live Events
May 15-17, 2017, Austin Convention Center, Austin, TX
May 15, 2017, Brazos Hall - Austin, TX
May 15, 2017, Austin Convention Center - Austin, TX
June 6, 2017, The Joule Hotel, Dallas, TX
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Time for a Telecom Reboot
Steve Saunders, CEO and founder, Light Reading, 4/19/2017
Surprise! AT&T Markets 4G Advances as '5G Evolution'
Dan Jones, Mobile Editor, 4/25/2017
Did Verizon Outbid AT&T for Straight Path?
Dan Jones, Mobile Editor, 4/25/2017
First Year TIPs the Scale Toward Success
Denise Culver, 4/24/2017
Unlicensed: It's What's Next for US Mobile Operators
Dan Jones, Mobile Editor, 4/19/2017
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
One of the nice bits of my job (other than the teeny tiny salary, obviously) is that I get to pick and choose who I interview for this slot on the Light Reading home ...
TEOCO Founder and CEO Atul Jain talks to Light Reading Founder and CEO Steve Saunders about the challenges around cost control and service monetization in the mobile and IoT sectors.
Live Digital Audio

Playing it safe can only get you so far. Sometimes the biggest bets have the biggest payouts, and that is true in your career as well. For this radio show, Caroline Chan, general manager of the 5G Infrastructure Division of the Network Platform Group at Intel, will share her own personal story of how she successfully took big bets to build a successful career, as well as offer advice on how you can do the same. We’ll cover everything from how to overcome fear and manage risk, how to be prepared for where technology is going in the future and how to structure your career in a way to ensure you keep progressing. Chan, a seasoned telecom veteran and effective risk taker herself, will also leave plenty of time to answer all your questions live on the air.