Giving All Your Customers The First Class Experience

I do not fly first class very often, but yesterday I was fortunate enough to do so on my way to Miami for the Internet Telephony Conference and Expo. It had been almost three years since the last time I had flown first class and at that time I was not flying enough to truly appreciate what “first class” meant.

My experiences yesterday; the unlimited access to drinks and snacks (not 4 oz and a bag of peanuts), the glass cups (not plastic), the roomy seats (not crammed), the leg room, the polite and speedy service got me thinking about business and why more businesses are not just offering first class, but making every class, first class.

Why should your customers have to pay more just to be treated the way that you would want to be treated?

The first class experience is not specific to the airline industry, either. I get the same first class experience every time I take my BMW to the dealership. Does it cost more to offer a first class experience than an average experience? Sure it does, but it does not cost THAT much more.

And it does not take much to offer customers a first class experience. Honestly, it is often the little things that count. In the grand scheme of your business what is your cost to offer everyone “glass” instead of “plastic”?

In a time when companies in the VoIP industry are facing increased pricing pressures and comoditization, should you be thinking about how you can differentiate yourself by offering a first class experience to every customer, whether they are first class or simply “coach”?

Coolest Viral Marketing I Have Seen In Some Time

A colleague passed this along to me today. Check out AsteriskHunters.com. It probably one of the most creative ways I have seen smaller communications providers market their products and services versus the “big guys.”

Help! I Can’t Sell My Phone System: Part Two

There Are A Million Ways To Skin A Cat

At least that is what the say. But how do you know if you picked the right way?

As we learned in part one of this series, the IP phone system marketplace is not the utopia some vendors make it out to be as the vendor themselves face many difficult situations, scenario and decisions along their path to succeeding in selling their phone system. For many, the path to success goes straight through the value added reseller (VAR). In part two of this series, we take a look at the VAR and where or not they should roll their own IP PBX solution from an open source telephony platform.

How Dumb Can A VAR Be?

It is a Friday. You know, the ones that seem to drag on forever? I am sitting at my desk wrapping up my day when at get a call. It is 6 pm est. “Hi, yeah, I need to place an order for one of them asterisk servers, a dual T1 PCI card, 35 Polycom IP phones and a couple of PoE switches…and I need it sent next day air.” Typically, these are the types of phone calls sales folks love to take and over the last few years, they have happened a lot (not anymore since I don’t do much inside sales work anymore). But this particular call, although it happened well over a year ago, still sticks in my mind.

You see rather than just take their credit card and shipping them their hardware, I decided to probe a little further. “So, your putting in an asterisk system this weekend, huh?” The customer boasts, “Yeah, I just closed a deal. Big money and I saved the customer a whole bunch. Part of the deal, though, was I had to have it installed by Monday morning.” Fair enough, I thought, but surely a big league VAR would have planned a little further ahead right? “So, do you do a lot of installations like this?” There was this momentary silence, followed by a sentence I will never forget, “Nope. This is my first, but I have played around with Linux before, I mean how hard could asterisk really be.”

Read the rest of this entry »

Help! I Can’t Sell My Phone System: Part One

One of the benefits being a relatively seasoned industry veteran working at one of the largest VoIP VAR’s in the world is that I have had the opportunity to use, play around with or demo just about every IP based phone system there is. In the last four years, my list of phone systems includes, 3CX, AllWorx, Asterisk, Asterisk Business Edition, AsteriskNow, CallButler, Cisco Call Manager, Cisco UC 500, Fonality PBXtra, Intuitive Voice, PbxNSIP, Shoretel, Sphere, SwitchVox (both Editions), trixbox CE, trixbox pro, VoiceBox, Vonexus, Zultys and a dozen other open source based solutions whose names escape me.

The interesting thing is though, that besides their granular differences in feature sets they are all essentially the same, yet some of these IP based phone system vendors are enjoying incredible success, while others are struggling (especially the systems whose names escape me).

Why Some Are Prospering, While Others Struggle

If it is true that in general a “phone system is a phone system” (an idea that I strongly subscribe to) then the reason that one IP based phone system vendor has more to do with the sales and marketing of their offering then the actual technology. It is with this idea that I will start with my insights.

Read the rest of this entry »

Help! I Can’t Sell My Phone System

I enjoy the unique pleasure of sitting at the cross roads between the end user, the phone system manufacturer, the VAR, the open source community and the VoIP service provider. It is a position that allows me the ability to look down each of the different roads to see the sticking points and the pain that each of these groups continuously encounter. As the market has continued to grow and mature with each passing day, I am getting more and more inquiries from all in-roads about IP based phone systems. Most these inquiries come from frustrated VAR’s or phone system manufacturers who just can’t seem to get their offerings off the ground.

Most feel like they are constantly trying to hit a moving target. They are right. With the rapid growth of the industry, the low barriers to market entry and the downward pricing pressures due to immense competition it is tough for everyone involved to turn a profit (when they do sell something) and for the customer to be happy with the solution they receive.

Read the rest of this entry »

Marketing VoIP Services To Non-Technical Consumers

Not All Consumers Understand VoIP

But you do not HAVE to make them fully understand the technology in order to get them to interested enough to purchase your VoIP service. You do, however, have to give them enough information and understanding of Voice over IP in order for them to be confident in making a buying decision. Here are some tips you can use, as a VoIP Service Provider, to help bolster your marketing efforts in order to increase your subscriber base.

VoIP Service Provider Marketing Tips

• Speak The Customers Language – Do not use tech speak. Keep acronyms to a minimum. If you had to tell a ten year old what it is that your company does, how would you describe it?
• Don’t Use High Speed or Broadband Internet to Describe an Internet Connection – 90% of consumers do not know what broadband means or if their service is high speed, after all, even dial-up services promote a higher-speed product. Instead, use DSL or Cable to describe the Internet connection necessary to use the service.
• Sell Devices That Mimic The Traditional Calling Experience – Telephone adaptors, while cheap, add a foreign device to the calling experience. Rather than wasting your time explaining what an analog telephone adaptor does, sell them and cordless IP phone. Customers are familiar with cordless phones and people like things that they are familiar with. It will save the time and headache of explain why you need and ata and how to install it. If you insist on having an ata, make sure you offer one that has PSTN failover, like a Linksys SPA-3102 or Grandstream GS-488.
• Explain What Happens When Their Internet Connection Goes Down – Do not just make this a bullet point in the fine print. Use it as an opportunity to differentiate yourself from your competition by explaining the issues and making sure your customers have a “back-up” plan such as a cellular phone or PSTN line for failover. Sure you might lose a customer or two, but the ones you gain will trust you. Trust build loyalty. Loyalty breeds lifetime customers.
• Show Them More Than Price – If the sole decision was price, then they would have switched year ago. Most non-technical customers needs reasons other than price savings to go through the “hassle” of switching their phone service. Promote the convienence of voicemail to email, how they can use a second number so others can call them for free, educate them on the benefits your features provide them.
• Do Not Make Switching a Hassle – No one wants a hassle. Make the sign-up process easy, have knowledgeable staff answering your phones, have a number porting system that constantly updates the customer on what stage of the number porting process they are currently in. Make sure devices arrive on time.
• Make Paper Invoices an Available Option – Believe it or not, many consumers WANT paper bills. Due to their “non-technical” nature, they may not be use to or comfortable with paying bills online. Do not make them do it “your way”, allow them to do it “their way.”
• Stop Assuming and Start Talking – Stop assuming you know what customers know about Voice over IP. I “thought” I knew what people knew about VoIP, but it wasn’t until I started selling VoIP in a brick and mortar retail environment that I started to “get it.” From there, I actually paid a friend to go out and get people to fill out surveys about their knowledge of VoIP. What I found was that most people know little, are filled with mis-conceptions, and really do not care about VoIP. But do not take my word for it, go out and talk to lots of people about Voice over IP.

While it is one thing to identify points that VoIP service providers need to market to, it is another thing to execute on them. Execution, after all, is just as important as strategy. These points are merely a starting point for enhancing the marketing of your VoIP service – do with them what you will.

Marketers, Engineers, Online Distribution, and Retail VoIP Oh My!

Marketers Create Products, Engineers Build Them

Andy Abramson has an excellent post on innovation and why some companies fail. I find that the number one problem with most technology start-ups is that they are started by engineers, not marketers. Engineers are wired differently and because of this they encounter many of the issues you describe above.

No offense to any engineers, but if you take a true look behind why “big” companies do a better job of marketing products, is because they follow a different process. For these larger companies, the marketing department, through r&d, and product development create the new products, not the engineering team. The engineering team is there to execute on the product the marketing team wants. They simply “build the product” to the exact specifications. It is then back to marketing for launch and then finally sales.

With most tech start-ups, there is a good idea, a product is built, and then it is dumped in the lap of a marketing person and agency, with a “go market and sell this.” The product is usually something that creator thought was great, but quite possibly is missing much in terms of the functionality and user experience. Something a marketer who is “in touch” with the intended user(s) would have pointed out and would have been corrected at larger firm.

Use Your Money to Build a Great Product Then Sell It Online

I disagree with Andy’s assessment of the internet as a poor distribution medium, especially for a start-up. Now much of this is dependant on the type of product or service, but one of the reason retail distribution is so expensive is that unlike online, there is a finite amount of shelf space. That shelf space has a hard cost, and brick and mortar retailers have to make sure that before opening up the shelf space to this new product, it has the potential to sell well enough to cover that cost and turn a profit. Because of this factor brick and mortars are extremely cautious as to what they add to their shelfs (just look at all of the people who have great products, but never get in Wal-Mart).

Online, once a basic website framework is constructed, the cost for me to add a page, or even replicate that site is nothing more then the cost of man hours. For a start-up that means more dollars to allocate to other channels (like making a good product great).

For Retail VoIp The Numbers Don’t Add-Up

As for retail VoIP, I have a bit of experience from the retail kiosk project that ran with Vonage here in Buffalo and I can tell you that there are some fundamental problems preventing the further growth of this channel.

1. Consumers who are attracted by the “save money” pitch (which is the one that was/has been picked by VoIP providers) typically attracts consumers with low levels of both knowledge and experience of the internet. Sure, most of the people who actually use VoIP are college educated, and well paid, but that is because they can fully comprehend the technology. The vast majority of consumers you will encouter in a mall kiosk setting (or even at radio shack) just are not able to comprehend the technology. Not that it is that hard to comprehend, but from my own “market research” during the kiosk trial you wouldn’t believe how many people think AOL “is the internet.”
2. Finding staffing that has the ability to effectively comprehend the technology and the ability to transfer that knowledge to a consumer, for say $8-$10 per hour plus a modest commission is difficult. Good luck finding enough individuals to make this happen on a large scale.
3. Subscriber commissions. In the cell phone business, the average rate per user (arpu) is around $34-$40/month (and rising). Given that cellular companies force a one or two year contract, they can project “guaranteed” revenues of $400 – $500 per year from that new subscriber. There customer acquisition costs are based on this and retail partner commissions are calculated. These (from my friends still in that business) tend to range from $150 to $250 per subscriber, plus bonuses for other add-ons (like text, video, ringtones, etc).

For VoIP providers, the arpu has to be a tad below $24 per month, and given that none are currently requiring a one or two year contract, their customer acquistion costs need to be a bit more conservative and because the arpu is 30-40% less then that of cellular providers, they in turn are not able to offer the same sort of dollars for activation of new subscribers.

Why give shelf space to something that is harder to sell, harder to staff for, and is less profitable?