Four years ago, my company entered the exciting new world of VoIP and found that our customers weren’t quite so ready for the idiosyncrasies of SIP. Granted, some idiosyncrasies seemed to some more like telecom basics ─ being able to hear the person on the other end without clipping and being able to consistently use DTMF tones or other newfangled functions like faxing. SIP most certainly was not ready for prime time in 2004. The convergence of SIP with customer networks’ woefully inadequate managed bandwidth was a recipe for disaster.
So where are we today? Are we any closer? We all keep hearing about convergence and unified communications, and how we really need SIP to make all these magical things happen. But is the average businessperson ready to take on all the new requirements necessary to making SIP really work in their business environment? Do you as a salesperson know what you need to know in order to sell the right solution?
The good news is that all your data and voice services can flow over one circuit. The bad news is that all your data and voice services flow over one circuit!! In a badly designed solution, a business owner gets to learn the hard way about network congestion and how it can affect VoIP calls. And the rumor that VoIP is cheaper than TDM is not always true.
When you’re selling VoIP and SIP applications, you’re talking to a whole different group of people. Instead of the phone guys, SIP applications are under the mysterious realm of IT, a world full of even more acronyms than telecom. Instead of just connecting directly into a PBX with a good old-fashioned TDM circuit, we have to worry about routers, firewalls, and internal customer networks that sometimes nobody really understands.
OK, enough about the problems. Here’s the really good news!
Choose a carrier or reseller who will help you choose the right services for your customer and is available for consulting to make those VoIP/SIP services work beautifully. Be certain that the network is ready for VoIP and other SIP applications, that the customer has the right amount of bandwidth and, even more importantly, ensure that the applications running over that bandwidth are prioritized correctly. In a business environment, VoIP traffic is more important than the latest music download. You’ll need bandwidth management so the customer’s network understands that.
You can help your customer take advantage of free interoffice calling, powerful applications that converge data and voice, and all the cool tools available via SIP applications. All you need is carrier-grade VoIP services, a carrier that’s willing to consult with you to make it work, and a monitoring and grooming device that keeps the customer’s applications and VoIP prioritized in the right way.
So the real question is not whether SIP is ready for prime time but rather is the telecom industry ready for SIP.
Sarah Linares is vice president and director of product development and revenue assurance for TMC Communications. She drives the development of new products and pricing structures for the company’s more than 300 agent partners. A seasoned professional with more than 15 years of telecom experience, she also leads the team that is responsible for TMC’s customer bill analysis and 99 percent invoice accuracy. She also is a member of the 2008-09 PHONE+ Channel Partners Advisory Board.
Most companies and independent agents are squarely focused on new business acquisition. Why shouldn’t they be? Growing the top line is critical in building a healthy and sustainable business. For those of us in sales and marketing, new business growth is not only a business priority, it gives us a strong sense of self-achievement. Looking at what new customer acquisitions added to the top and bottom lines at the end of the year is where we start measuring success.
But what about the existing customers? Are you focused on investing in a strategy to retain and grow that business? Many companies spend more resources on acquisition than retention – this is clear. But in these troubling economic times, your existing customer base should be protected and treated with as much importance as new customers. Likewise, shouldn’t your business plan reflect an approach that places ample investment in maintaining and retaining your base? By minimizing what’s going out the back door in customer churn you can more aggressively grow your base of customers and focus on quality accounts.
Here’s a case of a company that may be artificially measuring its success on new customer acquisition. I recently came across a new customer promotion from a telecom service provider. Significant rebates ($300-$500) were offered to new customers to break their current contract and transition their service. The surprise here was that there was no annual contract required to take advantage of the rebate. While this seems like a risky new business campaign with no guaranteed returns, there is a flip-side question to this: Does this same company invest the same monetary resources in customer loyalty and retention? Would they offer that same cash award as a retention rebate? The answer likely is, no.
To keep your brand top of mind with your customers, a multifaceted customer touch-point strategy should be implemented to not only drive customer loyalty, but to help grow these existing accounts. Your customers become more loyal if you’re routinely communicating with them and they feel you’re providing them a valuable service that your competition cannot easily replicate.
One could argue that in today’s competitive marketplace, a retention strategy that lasts throughout the customer lifecycle is the cornerstone to the health of your business. So next time you’re establishing quarterly or annual goals, be sure to establish success criteria and goals on retention. More importantly, match your investment in new business acquisition with that of retaining and growing your current customer accounts. Being one-dimensionally focused will hurt you financially, and help to feed your competition.
Retention is a critical component to the success of every distribution tier in our industry. Carriers, master agents and subagents all have a vested interest in maintaining business that they fought hard to acquire. That said, the agendas of these three entities can sometimes clash. The carrier naturally wants to retain the business on its network. The master agent and subagent want to retain the business in their base, irrespective of the network.
These potentially conflicting agendas create a question of protocol that may become more salient as our economy slows further and retention becomes more important. To wit, are carrier retention efforts, even if such retention would maintain the customer in an agent’s base, fair play? Or is retention the exclusive right of the selling agent?
The fear many agents feel when learning of a carrier’s proactive retention and renewal efforts likely is driven by stories or experiences of customers (usually the big ones) being renewed and, in the process, removed from the agent’s base. However, it’s clear that only a select few agents have coherent retention plans. Most are so focused on acquiring new business that they don’t pay much attention to business that’s falling away.
Nevertheless, agents are fiercely protective of their customer base and rarely want anyone to initiate dialogue without their oversight. If the carrier isn’t respectful of this relationship, a well-meant attempt to renew a customer could upset the agent, the customer, or both, and result in the business being moved out of spite.
We should all be able to understand the logic behind a carrier wanting to have a hand in retaining business it has, but too many carriers try to pursue renewals under the agents’ radars; without a doubt, there is fact behind agents’ fears that these renewals will end up removing the business from their base.
I would like to see some written ground rules, perhaps even integrated into the agent agreements, governing retention efforts. Even if the carrier says agents only get paid on what they renew, I would rather understand that policy clearly at the outset rather than have to battle it out with a carrier after the business disappears.
While I think that master agents and subagents have common interests in this regard, I think there is definitely value that a master agent should be bringing to its subagents in the way of retention management. A good master agent should clearly communicate with its agents the rules governing retention and should talk with the agent if it chooses to proactively perform retention efforts of its own. A good master/sub relationship should involve enough explicit protections and implicit trust that these efforts would be welcomed by the subagent.
What do you think? Are proactive retention efforts by carriers or master agents out of line? Would ground rules make them better or just spark conflicts? Is it ever legitimate for a carrier to remove a renewed customer from an agent’s base?
As an attorney, I often hear a common comment about agent agreements: “Why should I try to negotiate? The carrier’s not going to change anything.”
Since nothing is more important to the channel than a fair and balanced agent agreement, my response is always the same: “You’d be surprised at the concessions you can get if you simply ask for them.”
While it is certainly true that some carriers are not “agent friendly,” I have found that many realize how important agents are to their businesses and are willing to modify their agreements when a valid concern is brought to their attention.
Case in point: One of my clients had an agreement with a carrier that was purchased by another carrier. This was a great opportunity for my client because the acquisition would permit him to sell more products and cover more territory.
However, the acquirer wanted him to sign a new agreement that contained a minimum revenue commitment in addition to the one he had already signed with the acquired company. My client assumed he would have to agree to the additional revenue commitment, but I suggested that he explain to the acquirer that he had already exceeded the prior commitment and should not be penalized as a result of the acquisition by having to make yet another commitment.
Although reluctant at first to forego their demand for a new commitment, the acquirer eventually relented because they understood the unfairness of the situation and recognized the value that my client brought to the table.
This is just one example of the old saying, “You don’t get what you don’t ask for.”
Many times agents are hesitant to ask carriers for concessions for fear of “losing the deal.” My experience is that agents often underestimate their bargaining leverage. You may not get, for example, “most favored nation” status, but if you bring an important point to a carrier’s attention, the executives often are willing to revise the language of the agreement to address your concern. As I said before, many carriers realize how important agents are to their businesses and try to be accommodating.
The key is making sure that you and your counsel carefully review the agreement, point out all of the changes that are important to you and clearly articulate why the changes should be made, whether for business reasons, legal reasons or a combination of the two. Even if you only “win” one or two points out of 10, the negotiation process is well worth the effort.
Benjamin W. Bronston is a partner with the law firm Nowalsky, Bronston & Gothard. For the past 16 years, he has developed an extensive knowledge of legal and regulatory issues affecting a wide variety of telecommunications companies, including carriers, resellers, agents, master agents and support services providers. He also is a member of the 2008-09 PHONE+ Channel Partners Advisory Board.
In my last blog, I discussed carrier accountability in delivering a working circuit on time. In some ways, that's just the ante to the game. Customers expect nearly perfect circuit performance, particularly when all voice and data are riding a single T1.
Customers also expect accurate bills, which are readable and comprehensible to a finance or telecom manager. (Okay, pick yourself up off the floor). But sometimes there's a big, big gap.
As I write this, my company is in month five of a “please explain this to me” situation with a client who spends upwards of $11,000 per month with a single carrier.
The client's new CIO has been reviewing costs and can't quite understand all the components and line-item charges relating to MPLS and Internet service delivered to a carrier-owned colo facility. We sold the project in spring 2007. It took the carrier five months to turn it up (ouch) due to building permit delays. Now, 18 months later, I can't make sense of the bill items either.
We involved the dedicated carrier CSR, who gets paid to keep the customer happy. This person is top-tier and only handles “big juicy accounts” for this carrier. Unfortunately, a month of CSR backpedaling resulted:
CSR: "Gee, I didn't sign the order. I don't know. I wasn't assigned to the account when it was turned up. Why don't you ask the agent manager?"
Me: “Okaaaaaay, how about getting some help from your billing and provisioning teams?”
A week later...
Provisioning team: "Here's what's installed."
Me to the CSR: "Did you show this to the billing people to see if the bill accurately reflects the services installed?"
CSR: "Uh, no."
Me:: "Does it look right to you?"
CSR: "I'm not sure."
What's the game here? It’s like teaching a 3-year-old to tie his shoes. Meanwhile, the client's new CIO has got to be wondering:
What are they covering up?
Why can't they answer a straightforward question?
How much have I been overcharged in the last 18 months
Can I trust this agent?
Can I trust this carrier?
Maybe I should rip it all out and put in AT&T.
This customer spends $132,000 annually with the carrier and can't get a straight answer about billing for more than a month. As an agent, I'm cringing about this. All the work I've done over the last four years to build this account is being eroded by what the customer perceives as indifference and incompetence.
Leadership changes at customer organizations are times when vendors need to pay special attention to forming new relationships, demonstrating why, as the incumbent, they should continue to be treated as a trusted business partner. After all, the former manager at the customer is gone for a reason, sometimes performance-related ... and the new person is there to do a better job.
Carriers are in an enviable business — one with a predictable recurring revenue stream. Yet, in the customer's eyes, carriers (and agents) are often only as good as their last interaction with the customer. We have the opportunity to either build or destroy trust every time we interact with a customer. Sometimes carriers seem to forget that it’s people out there making those purchasing and renewal decisions.
Does channel manager support seem like trick or treating sometimes? You never know what you’re going to get. Well the old saying, “I got a rock!,” comes to mind.
In light of all the recent conversations with carriers pleading with agents not to sell on price alone, let me state that I have built my business with relationship-based selling. The carriers might want to take note of this because we, the relationship-based sellers, only do business with carriers that treat us like valued long-term clients.
The definition of client is a customer or patron, one that is under the protection of another. And I believe that too often many channel support managers (CSMs) forget that we, the agents, are their clients and that the end user is our client. If they take care of us and treat us properly, we will remain loyal and place our trust in them to provide products and services to our clients, the end user.
If a new-to-you carrier or channel manager calls you with the greatest product or pricing since sliced bread, do you do business before getting to know them plus at least a few other people within the organization? And what do you do when that CSM, your main point of contact with the company, completely drops the ball and gives you the proverbial “rock” for Halloween?
It’s my job to get to know my clients and take care of their needs. The carriers should think about building and maintaining better relationships with us agents, their clients, the people actually selling their products and services.
Happy Halloween!
James Lockhart is president and CEO of Telecom Management Inc. (TMi), a solution-based telecom consulting firm, which he has grown from a one-man operation to a small master agency with voice, network and conferencing divisions. He serves on the ACC Advisory Board and TMi is an ACC Presidents Club winner. Lockhart also is a member of the 2008-09 PHONE+ Channel Partners Advisory Board.
By Adam Edwards, President and Co-Founder, Telarus Inc.
I know it’s impolite to discuss politics and religion among friends but somehow we always end up on these topics at our staff lunches. Frankly, I quite enjoy the conversations with the ground rule that nobody takes offense or gets too preachy. Now, if you won’t get offended, I promise not to be too preachy in my comments below.
I was absolutely blown away by the PHONE+ poll that said 57 percent of respondents believe McCain will have more pro-competitive policies than Obama. I’m not sure how people could come to the conclusion that McCain would be pro-competition. Perhaps it’s because Republicans are typically seen as “pro-business” or perhaps it’s because McCain has a long history of supporting deregulation, which typically means more open competition. When it comes to telecom, however, when we say “pro-competition,” we’re talking about CLECs and the legislation that started them, are we not? It was, after all, the Telecom Act of 1996 that caused an unprecedented explosion in carrier channel programs, which were, in large part, instituted by CLECs. With regard to CLECs and the Telecom Act of 1996, McCain’s history is anything but friendly.
Here’s a bit of his history to consider:
McCain voted against the Telecom Act of 1996, which created CLECs.
McCain backed Michael Powell as FCC Chairman; Powell fought to erode the 1996 Act.
McCain called for eliminating rate regulation and doing away with the FCC.
Other interesting facts:
AT&T and Verizon are among McCain’s top campaign donors.
More than 60 present and former telecom lobbyists work for McCain's campaign as staffers and volunteers, some in high-echelon posts while on leave from their firms.
I’m not telling anyone how to vote, nor am I stumping for Obama. Full disclosure, I’m a registered Republican and there are plenty of things I don’t like about either candidate. When I look at this issue, however, and back away from my other thoughts about the candidates, I cannot see how McCain would be friendly to Competitive Telecom. I can see how he would want to deregulate and strip away government intervention to instill a free market in telecom that is pro-competition, but it is not pro Competitive Telecom.
If someone who decided why they think McCain will be better for Competitive Telecom can explain their thoughts to me without being too preachy, I promise not to be offended.
Adam Edwards is president of master agency Telarus Inc., which he co-founded in 2002. He also is a CPA and previously held positions in finance for manufacturing and technology companies as well as in auditing at KPMG LLP. He also is a member of the 2008-09 PHONE+ Channel Partners Advisory Board.
Editor's Note: The Oct. 16 PHONE+ poll Edwards refers to remains open and the percentages are fluctuating, but on Oct. 22, the result showed 57 percent of readers viewing McCain as having more pro-competitive telecom policies. Click on the link to register your vote.
