The old adage, “It works if you work it,” certainly applies to selling conferencing services. One conferencing sale here and there isn’t going to make an agent a fortune – but the profits from multiple sales and add-ons can add up quickly.
Conferencing itself – along with agents selling it – has had a firm foot planted in the telecom landscape for a long while, causing some to say that it’s lost its steam.
“It has become a commodity and offers no real value to carry as a mainstream offering,” said Gene Foster, president of master agent Communication Management Services. “Audio services you can get for 3 cents per minute (just two years ago, we were selling it at 20 cents). Web and video comes at about twice that and our larger users who had billings of $15,000 on up to $75,000 or more per month have all purchased their own bridges with the cost declining as much as it has.”
As a result, Foster said his company no longer offers it as a primary offering and has ceased all advertising of conferencing services.
James Flynn, director of sales at Copper Conferencing, agreed that margins aren’t what they were in 1999, but said that they are still very strong. “The amount of growth in the last nine years has been huge; so while the cost per minute is down a bit, the total minutes are way up,” he said, noting that many customers still buy at 1999 rates, so there is an opportunity to save the customer money and still generate a healthy commission.
Adam Edwards, president of master agency Telarus, said conferencing’s decrease in price is no different than the price reductions on other services that agents continue to sell. “Pricing on conference calling has dropped, but it still has twice the margin as a traditional voice sale,” he said. “I don’t understand the rationale behind dropping a service that can significantly increase a customer’s billing amount and do so at a nice margin.”
Edwards also said the price decreases have expanded the addressable market for conferencing services and solutions. He agreed, however, that the drop in overall solution prices might drive larger enterprises to buy and manage their own systems.
Digital Samba USA also recognized a trend toward purchasing the equipment, and so it offers both conferencing services and a premises-based enterprise conferencing server solution. “The way that customers buy conferencing will change,” explained Jonathan Maley, director of U.S. marketing operations at Digital Samba. “Through 2011, the share of conferencing purchased on a service basis will fall drastically, while the share of conferencing acquired on a server model will nearly double. In short, the market is and will continue to be healthy, but smart vendors and agents should ready themselves for a sea of change in how customers want to buy from them.”
Smart agents should be able to help customers understand what it means to take on a hardware solution. Copper Conferencing’s Flynn said agents should ask