Jola Cloud Solutions' Blog

Definition of success

The financial rewards that come from being successful in business are of course important to most entrepreneurs. Other factors may be more personal, the satisfaction of creating a business and running it the way you have always felt businesses should be run, or providing complete customer satisfaction and an environment your team never want to leave.

Measuring success

Working in the business it may feel as if all is well, but verifiable data is required to confirm this. One of the best measures of success is profitability against plan. Understanding the peaks and troughs in revenues and analysing margin by product can help to identify cash cows and problem children within the product portfolio.  Cash flow forecasting is a good measure to ensure the future financial success of the company.

Successful verticals

Successful IT and Telecommunications companies find their niche and develop strong relationships with their customers by delivering exceptional service. Often they will specialise in solving key problems in vertical markets, perhaps by building on an early win. They tend to be in-tune with their customers and the first to be contacted when services and hardware need to be upgraded. Most are agile and flexible and will seek out likeminded suppliers, to meet requirements for services they do not currently offer. 

What can we learn from our past?

The Jola management team worked at Griffin Internet for over ten years together. Our CTO invented white-label managed broadband by developing MOPS, a platform to allow resellers to provide ‘own-branded’ broadband connections directly. We promoted it as ‘ISP in a box’. In our first few years we added over 800 partners to the platform, including market leading suppliers in the channel today.

Most commentators felt that when fixed broadband was fast, reliable and affordable, it would become the conduit for SMEs to run their cloud applications over.

We learnt that having a management portal, with APIs into multiple carriers, allowed us to grow significantly without investing heavily in additional resource. It gave our channel partners the ability to increase ARPU, whilst retaining the control of the customer experience end-to-end.

We helped the channel to benefit from the rise in demand for white label internet connectivity from DSL to fibre and leased circuits. We are ready to do this again with mobile data.

The Mobile Data Opportunity

Mobile data has, until recently, been slow, unreliable and expensive. There is an issue with ‘bill shock’, as users regularly go over their allowances and are unprepared for the high cost of overages.

Without tools to manage large estates of SIMs and prevent or manage over-use, resellers have felt helpless and vulnerable. Many have supplied mobile data only when requested to do so by customers and many have introduced them to a carrier essentially giving up their customer.

What the experts say

Marketing bodies suggest between five and ten percent of annual revenue, if you are a company turning over less than £5 million annually.

The reality

It depends on a number of different factors, such as the type of industry you work in and the objectives and culture of the business. Some companies rely heavily on word of mouth and so don’t have a set marketing budget. Others have high growth targets and lots of competitors, so tend to have a much more detailed marketing strategy, which includes reforecasts and reporting on return.

It really depends on individual company objectives and often comes down to what the business can afford. Within a sales-orientated culture with a marketing team that is aligned and integrated, you are more likely to see marketing budgets and ROI targets. In project-orientated environments, marketing budget is often allocated on a project-by-project basis, for example a product launch or a re-branding exercise.

The importance of planning

However much you spend, it is helpful to outline objectives and set targets before you start to invest time and money. Don’t get disheartened if results do not materialise overnight, you may need multiple touches and time to hone your key messages.

It is essential to test market methods to see which combination provides the best return, before investing heavily. So many factors can alter business objectives, so it is important to be able to build in additional activity or scale back to meet budget restrictions as required. Negotiating shorter contract periods can help to facilitate this.

Budget by activity

According to recent research by Forrester, the average firm allocated 30% of their annual marketing budget to online activity and this is set to increase. This makes sense as a company’s online presence is essentially their shop window and online marketing is relatively inexpensive, yet is easy to track, monitor and edit.

A recent report by Program suggests a larger percentage is spent on email marketing with more traditional marketing activity such as tradeshows, events, direct mail, PR, print, outdoor and radio advertising, listed at less than 30%. These activities can often cost more but can be less frequent. It is important to try and calculate the potential lifetime value of any new business that could be won against the total marketing investment.

Who is buying fast business broadband?

The obvious answer is anyone that needs one, but in our experience business customers are particularly seeking out fast fibre broadband circuits when upgrading from traditional to hosted telephony.

Broadband is the common term for a fast connection to the Internet. It allows business users to browse the web faster, stream video, have real-time voice conversations, use cloud applications and backup their data online.

Fibre broadband promises super-fast speeds. The name comes from the use of plastic or glass cables, which allow for faster data transfer, compared to the standard copper wires.

Business customers are asking their IT and Telephony suppliers for help when looking to upgrade their business phone systems. They want to talk to specialists who can review their office networks and suggest cost effective alternatives.

With hosted telephony you don’t need PSTN, ISDN or SIP trunks, there is no phone system on site to maintain and packages are priced on a per-seat-per-month basis. Companies can have the latest handsets and a feature-rich phone system to include Auto Attendant, Instant Messenger, Presence and Video and can make, take and transfer calls from their mobile or tablet remotely as if sat at their desk. They can connect the phone system to internal databases so that customer details ‘pop’ onto the screen and they can click-to-dial from documents and web pages. HD voice is available and running voice over a dedicated fibre broadband connection is a good way to protect call quality.

It is hard to achieve a good experience for all customers at all times.  Technology can fail, third parties can let you down and, despite your best efforts, end customers can feel like their issue is not being resolved fast enough.

Understanding how to best differentiate your proposition is a question many marketing, sales and product specialists are revisiting on a regular basis. It is hard to sell on the basis of customer service. Everyone will claim that their customers rate them very highly and prospects just expect this to be the case anyway. However, once you have satisfied customers you are less likely to lose them on price and more likely to win customers from your competitors, for whom customer service may be less of a priority.

What constitutes great customer service has changed over the years. It is no longer enough to answer the phones within 10 seconds and respond promptly to emails. Resellers, dealers and their end business customers expect more.

Putting the customer in the driving seat

Self-service portals are expected and if you don’t have the know-how or resource to develop systems in house you probably choose suppliers that do. Simply being able to order products online is no longer sufficient and the best customer experience occurs when every aspect of the ordering, provisioning and support journey is considered., Resellers and dealers need to be able to order multiple services in one journey, create branded click-to-order quotes and be able to extend online features to their own customers. The best companies are going one step further by creating management portals that anticipate and solve real business problems. Mobile data is a recent example. As coverage has improved and costs have come down, businesses that want to make more use of mobile data have been put off by unpredictable overage charges and their inability to manage large estates of mobile data SIMs. Mobile Manager has for the first time given resellers and their customers the tools to activate, swap, pause and cease SIMs through an intuitive, easy to use portal.

Two big initiatives

When it comes to enhancing the customer experience, customer journey mapping and personalisation are the two big initiatives. As marketers we can learn from the behaviour of our prospects and customers and customise our approaches and promotions accordingly.

The impact on growth and profit

Good customer experience is not just about a feel-good factor. Companies with higher customer satisfaction scores grow faster, are more profitable and worth more.

Whether you are a small company looking to grow your business or a large company looking for market dominance, you will need sound planning, consistently astute decision making and successful execution to achieve your goals.

Growth strategies are numerous and diverse but in general the three ways to build a business are; through sales, by buying other companies, or by buying their customers.

To build or to buy?

Both strategies present risks and trade-offs which need to be fully analysed and addressed before progressing.

Inorganic Growth 

This roll-up model is best suited to industries that rely on recurring revenues. Whether you are buying the whole company or just their customer contracts, the objective is to buy them for less than the terminal value of the combined group. In industries like telecommunications where resellers are valued on multiples of gross margin, it is common for suppliers to buy their resellers for the margin improvement created when a link in the chain is removed.

A sudden shift in size presents multiple challenges such as integrating new customers, changing the billing process, managing an enhanced product portfolio and new suppliers. Success comes down to skilful execution and integration with minimal investment in new systems and staff.

Organic Growth

Pursuing organic growth takes time and nurturing. You may start with an idea and a portfolio of services and go off on a profitable tangent, developing new propositions with higher recurring margins in new niche markets.

It takes time to fully understand your market, where products and services exactly meet the needs of your audience and offer something above and beyond the competition at a margin that works.

Risks occur when expansion outpaces the ability to effectively manage the new business. Growth from new revenue streams can easily divert focus and resource from core business, which in itself can be risky. On the whole, organic growth may be slower but easier to manage.

Business users are consuming far more data than they used to due to remote working and the availability of mobile apps, such as Office 365 and Skype for Business. Other business applications have followed suit, creating for example business telephony apps, allowing users to make, forward and receive calls on their mobile as if it were their desk phone.

According to Gartner, there will be as many as 21 billion connected devices by 2020 generating additional mobile data traffic. SIM cards are being used inside more and more vertical devices, presenting challenges. Firstly, how can you manage a SIM card that is inserted into a device and thousands of miles away? Secondly how can you manage usage? We know there are high costs for going over data allowances on mobile phone contracts, the same applies in other devices.

According to a recent report by Zion Research, VoIP services are set to grow rapidly over the next few years, reaching £112 billion globally by 2021. The report explains that the growth is driven by the technological advancement of network infrastructure and is influenced by the rise in the number of portable devices.

The report analyses VoIP by call type with international VoIP calls emerging as the leading segment, with the majority of calls being made by computer to computer. Phone-to-phone calls are predicted to see the highest growth over the next few years. Hosted services as well as IP connectivity are set to see significant growth as businesses come out of contract and realise the cost benefits of upgrading their business telephony.

The benefits

Reduced costs with no capital outlay

Many hosted solutions are sold on a per-seat basis with no initial capital outlay, unless customers want to buy handsets upfront. In addition, many call costs are free, not just internally across multiple sites, but to UK landlines and mobiles too, with low international call rates.

Feature-rich

Features such as busy lamp fields, auto attendant, call recording, call reporting and music on hold are now more affordable on a per-seat-per-month basis and customers can tailor the solution to meet their exact requirements.

Multiple devices

Some hosted telephony solutions are available on multiple devices such as computers, tablets and mobiles, which enables customers to work remotely as if they had taken their desk phone with them.

Scalability

It is easy to add or remove a seat as required, as many hosted solutions are on 30-day contracts.

Disaster recovery

If for whatever reason there is an issue with the phone system, your office, or employees can’t get into work, you can easily re-route calls to mobiles and carry on, business as usual.

If you partner with suppliers for services such as internet connectivity or hosted telephony, there is often an on-boarding process. Some suppliers insist on product and platform training before ordering portals are released, others are much more flexible, tailoring programmes and materials to suit you.

But how much training is required?

Often you are familiar with the technology and have used similar portals so little structured training is required.  You have account managers on hand to help you as you pitch, close and provision your first order and your support team is not fazed by the latest variation of services.

You may want more in-depth product training for multiple team members to gain an overview of key features and benefits and target customers. Information about competitive products you are likely to come up against in the market and which USPs to promote. Provisioning teams may require in-depth platform training and support teams may prefer more technical training around common faults and fixes.

What’s the best method of training?

Face to face

Some people prefer on-site practical training, where they can drive processes from start to finish, with guidance from experienced trainers.

Online

Others prefer online training webinars they can book themselves with access to recordings to refresh knowledge or train others as required. Many portals are intuitive with help guides, training videos and support documentation online.

I recently read an article about marketing in the channel. Interesting points were raised about strategic planning and consistency. Aligning marketing plans with business plans and playing the long game were cited as being key. Agencies and suppliers were offering marketing support to help resellers make the most out of funding and materials available, but how effective can they be in isolation?

On the vendor/supplier side you want to create scalable programmes that are easy to manage with measurable ROI. Resellers want hot leads, new customers and increased revenue.

The challenges

The two biggest challenges for marketing are setting expectations from the outset and gaining collaborative commitment throughout the business. MDs are often attracted by the prospect of receiving new leads without committing time or resources. They hope for quick results and disappointment can turn to dis-interest.

Integration

Marketing doesn’t stand alone. It needs to be integrated into core business strategy. Companies that have grown well in the channel with recognisable brands have not only integrated marketing plans with the core business plan but also understood the needs of the market. They have packaged, priced, promoted and supported solutions profitably to meet these needs, often investing heavily to do so. The senior management team are as focused on leads as they are on opportunities and marketing statistics are measured in the same way.