Reader Forum: Top five areas to increase deal flow and grow revenue when selling value-added services in today’s mobile market

Editor’s Note: Welcome to our weekly Reader Forum section. In an attempt to broaden our interaction with our readers we have created this forum for those with something meaningful to say to the wireless industry. We want to keep this as open as possible, but maintain some editorial control so as to keep it free of commercials or attacks. Please send along submissions for this section to our editors at: dmeyer@ardenmediaco.com or tford@ardenmediaco.com.
Selling to mobile operators in today’s environment is more challenging than ever. Severe economic conditions surround every operator’s purchasing decision. New products and solutions that need evaluation are emerging at a faster pace in every region of the world. The resources required to evaluate this growing array of choices, however, have not grown, and, in many cases, have actually shrunk.
Providers that expect to sell to mobile operators in this environment must embrace a multi-dimensional sales strategy that mirrors the mobile operator’s decision making process. For a CEO or VP of sales or marketing, that means designing a strategy around five elements that parallel the factors operators weigh before deciding to add a new product to their portfolio. Those five elements are: matching the product to the market; articulating your solution for the market; focusing your presentation on the right executive; clearly defining the business model; and identifying the real competition.
Let’s examine them individually.
1. Product market fit: Matching the product to the market.
A company will often assume that what works – i.e. what is being sold and accepted in one region will work in any other region of the world. That assumption is just as often wrong. Just because your solution works well in the U.S., it will not be automatically accepted in the Czech Republic for example. Look through LinkedIn Groups and you will find operators trying to find solutions that fit their specific markets.
Solutions today can run on the handset, the SIM card, a backend server, or on a combination of all three. You need to recognize how your application might fit, or not fit, within that specific mobile operator. For example, if your application runs on only certain smartphones you need to understand what service the operator has or is planning to offer; and what the market penetration/utilization is for this device. Another example: you have an application based on premium SMS pricing, but the target market has extremely low SMS pricing or an “all you can eat” pricing plan. Both would greatly affect whether your solution is right for this market. To increase your chance of success when introducing a new service, you must do your market research, talk to industry experts, and engage with prospective customers before you launch.
2. Solution presentation: Articulating your solution for the market.
Too many sales presentations do not focus on the needs of the operator that you are trying to sell to. You must understand the specific challenges facing this person at this operator at this time. What is most important to them right now —subscriber retention, growing ARPU, increasing utilization of current service offering, or something else? You must also speak your target operator’s language because it demonstrates that you understand their market and are speaking to them.
Two simple examples of this are using the term carrier vs. telco vs. operator when speaking to a mobile operator, or saying “cell phone” vs. “mobile phone.” A U.S. company sales executive won’t be taken as seriously when they use the wrong terms. The implication is that you do not really understand the operator’s market. To keep you on the right track, do your homework. Stay well-read on the international markets you are targeting, test your presentation with local experts and leverage the experience of your global partners.
3. Targeting the right person:‘C-level’ or not.
It is not always about selling high. It is about getting in front of the right person. With mobile operators it is paramount that you carefully match your selling process with the operators’ buying process. Understanding how they make decisions and their specific process of bringing new value-added services to market are crucial to shortening your sales cycle. First, a tactical example; if your value-added service utilizes the SIM card, then the SIM technical team is important in the overall process for three reasons:
–There are so many interdependencies between applications;
–There is always competition for space on the SIM; and
–Evaluation/testing is often a lengthy process.
This tactical-level example would be directed at the marketing team. The second example is more of a strategic approach. If your solution can provide a strong competitive advantage but requires significant capital expenditures, then you must target the CEO and/or CMO. If you can demonstrate that your solution would be a significant differentiator in the market, they will help you drive the decision process through their company. Of course, the operator’s size will also determine the right entry point. In many of the smaller operators, those below 10-12 million subscribers, you would start with the “c-level” executives.
4. A clear business model: Both for you and for the operator.
Launching a new value-added solution always costs money. Cost can come in the form of either a large upfront cost with an ongoing service contract, or no upfront investment and a “pay-as-you-go” license or usage fee. But there are other costs that can be substantial for some services. These include the costs of introducing the new service, and which in turn includes testing, marketing, advertising, training and support.
You must clearly lay out the complete business model for the operator. To accelerate the sales process, be sure to include an ROI model with your assumptions. Providing the operator an easy-to-understand model that allows them to enter their own parameters goes a long way in accelerating the sales process. It is also one of the best tools to demonstrate your advantage over the competition. And, for some value-added services, where the utilization or uptake are slower growing than anticipated, ask yourself if the resulting heavily back-end loaded revenue meets your business model and will sustain your business.
5. Who is your competition?: Not always the obvious.
Because the mobile market is so multi-dimensional, your competition is not always obvious. For example, say you are selling a SIM-based application. Your competition is all the other applications that take space on the SIM card and/or require the same limited operator resources, such as testing/evaluation time, marketing launch, etc., that are already allocated to other projects. Operators have only so many resources for launching new services each year. Knowing these other “competitors” will enable you to sharpen your message, focus your sales presentation and deliver to the operator a clear differentiating business model.
There are certainly additional aspects to consider when selling mobile applications in the global arena. These include marketing, messaging, promotion, forecasting, market research, strategies for market entry, etc. – all subjects for future articles. The five that I addressed in this article are the most important because they will shape your sales strategy to increase the deal flow and, more importantly, increase revenue. Gaining a firm grasp of the dynamics of the market that you are addressing is paramount in achieving sales success in this global environment.
Jeff Schiebe is a global sales and marketing executive who provides business development, sales, and marketing services to the wireless, communications and Internet markets on a worldwide basis. Mr. Schiebe has more than 30 years
experience in high technology companies in t
he wireless, telecommunications, computers, software, Internet and professional services markets. Spending the last five years in the global wireless market, Mr. Schiebe worked with mobile value-added services right at the crossroads of SIM cards, mobile handsets and mobile operators. During his career he has traveled to more than 50 countries in virtually every region of the world and is currently writing a book capturing the wealth of persons, history and stories that he has experienced. You can contact him via e-mail at jeffschiebe@verizon.net.