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Optimizing the Consumer Communication Service Sales Channel

  • October 2014
  • 11 pages
  • Frost & Sullivan
Report ID: 2432020

Summary

Table of Contents

Introduction

The intent of telecom regulators, back in the early 1980s, was to achieve a competitive environment in the US telecommunications market by breaking up the Bell System. Whatever else that breakup might have achieved, it has certainly increased the competitive forces working in the market. As telephony achieved ubiquity, and as new services such as wireless and broadband access are rapidly doing the same, increasingly, revenue growth is being driven by the need to capture customers from a competitor. Finding ways to do this has increasingly been driven by exploring new ways to enable a consumer to purchase service packages. This has provided added emphasis on understanding how the consumer views and prefers to use various channels to access service offerings.
Everything from online service purchases to door to door sales people has been explored by carriers seeking to maximize their take rates. However, it has not been clear to what extent any of the methods explored are actually preferred by consumers, and how many simply have served as irritants.

Partially in an attempt to ascertain what might constitute the most effective sales approach, Stratecast conducted a survey under the auspices of its Connected Home practice, where it asked the respondents how they acquire their communication services; and, more to the point, how they prefer to acquire their services. Although this does not necessarily provide certainty as to which approach is best (after all, new marketing and sales techniques are being invented all the time), it does provide a notion of the ways that are least likely to drive customers away rather than enticing them to try a new service or provider that they may not have considered in the past.2
This SPIE, driven by questions from Stratecast clients, provides some insights into the sales channels in use currently, and provides some guidance on how such channels might evolve so as to increase their efficacy. It should be of interest to marketing and sales organizations within the carriers.

Approaching Perfect Competition?

In a monopoly market, sales channels are largely irrelevant since there is only one place a consumer can go to obtain a product or service. However, the closer a market is to perfectly competitive—that is, the closer it is to a market with many competitors who are offering largely the same product or service—the more potentially important are the impacts of various sales channels.
While many would argue that the telecommunications market is not perfectly competitive, it is none the less characterized by an increasing number of providers, all of whom provide similar products and services. As Exhibit 1, below, shows, this is driving an increasing interest in sales channels, and a great deal of innovation in the ways that operators approach potential new subscribers.

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