Challenges and opportunities for 2018 – what’s your service strategy?
Service launches need to be tied clearly to the resources of the provider and the appetite of customers, but they can serve different strategic aims. But, strategy is nothing without action, so the key challenge for 2018 is not so much formulating another strategy, but rather to implement the chosen path successfully and to ensure new services can be launched quickly and profitably – and that they are focused on adding value where it matters.
There will be many predictions for the telecoms industry and markets in 2018 but one thing is certain: there are challenges ahead. Equally certain, however, is that they will bring many new opportunities. For example, it’s routinely reported that service providers of all kinds are challenged by decreasing prices and increasing margin pressure.
While some are focused on cutting costs and slashing funding for projects, that’s not a long-term approach. A better remedy is to focus on new services that can generate revenue. And which build on existing strengths and capabilities. In fact, there are four basic strategies behind the launch of new services, each of which may suit in different circumstances. To summarise:
1. Upside – the new service allows more revenue to be captured from existing customers
2. Defensive – adding the new service boosts retention and protects revenue
3. Growth – the new service attracts new customers and is the foundation of other, related services
4. Competitive differentiation – to stand out by offering something that others do not
Anything else is really just a blend of these themes but the key is to take action. With unstable prices, squeezed margins and the ever-present threat of new competition entering the fray, indecision or prevarication could have a significant negative impact. So, the clear opportunity in 2018 is to use services to address revenue and margin pressures.
The question then is, which services and for which customers? Well, as Analysys Mason and others have pointed out, not only is new service revenue needed (see options 1 and 2), but “operators have the option of providing enterprises with security, SaaS, IaaS, hosting, IoT and pay TV services”, which adds up to what might be a bewildering range of choices.
So, this is a good place to start. But, that still represents a dizzying range of options. In order to succeed with any service launch, focus is a prerequisite. Service providers need to consider which services are best tuned to their strategic capabilities and resources. In other words, which are within their grasp and which are more of a stretch.
For many, that means they should start with services that essentially extend and enhance voice offers. In time, these can be complemented with additional capabilities or offers that address entirely new products, but it’s far more sensible to start with something in which you already have expertise and capabilities than to enter a completely new market. For example, hosted and mobile PBX offer valuable capabilities while providing the opportunity for new revenue or for defending an established position. These can be supplemented by services such as call recording, to meet MiFID and other compliance requirements, and conferencing to ease collaboration.
As we move to 2018, it’s time to think again about how you can revitalise voice offers for enterprise and business customers. Instead of thinking about minutes and bundles, service providers need to think about efficiency, collaboration and ways in which they can help their customers become more productive while meeting new legislation. Whichever strategy fits your business plans, voice can be a key enabled to adding value – and it’s too important to overlook.