SOHOSAND SMESThe Digital Service Provider Opportunity with the 99% of the world’s businesses

Camille MendlerPractice Leader, SoHo & SME Services

#OvumDF17 @Ovum

The B2B universe: Time to look the right way up

99% of businesses

2/3rds of jobs (formal)

80% of jobs (informal)

Micro / SoHo(including self employed)

Small

Medium

Large

The B2B universe

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New services for SoHos / micro SMEs and dedicated call centers

Going big in small business: Activity is growing

Acquisitions

New local / small biz division post XO acquisition

Various SME acquisitionsin UC, cloud and IT services

New services for Brazilian SMEs in a consolidating B2B market

Restructuring Services & support

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B2B client focus: Many DSPs are meeting in the middle

Midmarket

Medium

Small

Micro / Soho

Consumer

TELECOM OPERATORSFrom a large / multinational focus into vertical adjacencies, down to SME, often via M&A and partnerships

CABLE OPERATORSFrom a consumer focus to SoHo / SME, with midmarket aims, using a growing portfolio and price-led approach

MOBILE OPERATORSFrom a consumer focus to SoHo / SME and sometimes beyond, usually with a price-led, limited portfolio

Large / MNC / Government

B2B client focus

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B2B targeting: More nuanced, but still simplistic

Picture source: Slovak Telekom (Slovakia)

Picture source: AIS (Thailand)

Considering job type Considering industry Considering problems to solve

Picture source: Globe (Philippines)

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B2B targeting: How to engage and with whom?

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Another way: Use personas

In the dictionary

“The aspect of someone's character that is presented to or perceived by others” (Oxford Living Dictionary)

In marketing

A composite picture of a group of customers, usually encompassing their values, aspirations and fears, as well as typical socio-economic characteristics.

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Methodology: Correlations and cluster analysis

B2B persona findings are derived from Ovum primary research conducted during 2016 and 2017

Aggregated SME dataset

Sample 7,015 respondents

RespondentsTechnology decision makers across a range of job roles

IndustriesProduction, Service and Knowledge-centric industries

Size bands

All size bands. *note: up to 499-employee firms in Canada, US and Australia

Geographies

24 developed and emerging countries across Western and Eastern Europe, North America, Latin America, sub-Saharan Africa, Middle East, north andsoutheast Asia 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Agriculture, forestry and fishing (n=183)

Accommodation and food services (n=459)

Transportation and storage (n=520)

Health and personal services (n=1,027)

Construction and real estate (n=1,055)

Manufacturing (n=1,078)

Retail and wholesale trade (n=1,211)

Business, financial and prof services (n=1,482)

Industry and size breakdown

Freelancer / sole trader Micro firms (2 to 9) Small firms (10 to 49) Medium firms (50 to 249*)

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Using personas: Service providers must recalibrate B2B metrics

Firmographics Number of companies and sizes

DemographicsNumber of people and job types

Sites & seatsLocations and licenses

Individuals & tasksPeople and what they do

TransactionsSales channels and billing

JourneysClient engagement and lifecycle

Point solutionsIndividual products and services

Integrated solutionsService clusters and bundles

From To

Required changes in B2B customer assessment

Source: Ovum

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Creating personas: Less is more

Small businesses contain many facets

Critical for B2B, service providersmust distinguish between:

• Buyer personas: Those who control or direct ICT expenditure across all or parts of a business

• User personas: Those who use or consume ICT devices, products and services within the business

$2Mturnover

Source: Ovum

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B2B value propositions: Consider the buyer

Buying for Buying for own use for others

Consumer Businessoriented oriented

Common B2B value propositions

SoHo SME

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Triaging B2B metrics: Age does matter

N=820. Note: Startups are under 3 years old; established firms are at least 3 years old. Source: Ovum

Startups: Age of technology decision maker

Established SMEs: Age of technology decision maker

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Core buyer personas: Summary viewPersona Description World view Typical job role Concerns Buying

preference

Visionary A strategic buyer motivatedto differentiate their business.

• Outward• Medium to

long term

Business ownerCEOManaging director

• Finding new customers as important, if not more, than managing costs

• Competitive pressure• Legal compliance

ResellerAccount manager

Expert An expert buyer motivated tosolve specific business problems.

• Inward• Short to

medium

IT / network managerOperations / facilities manager

• Managing costs• Staff training & retention• Legal compliance

Self serveAccount manager

Administrator A pragmatic buyer motivatedto keep business processes running smoothly.

• Inward• Short to

medium

Office managerExecutive assistant

• Managing costs• Competitive pressure• Administrative burden (general and

compliance related)

Call centerAccount manager

Maverick A tactical buyer motivated toimprove their immediate working environment.

• Outward• Short to

medium term

FreelancerLine of business

• Customers and competition• Managing costs• Up-to-date skills

Call centerAccount manager

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Propositions: Mapping to personas /1Proposition Supplier value SME value Buyer persona

• Supersize consumer offers to accommodate heavier business use

• Minimal reconfiguration of back-office systems required

• Familiar consumer services, tweaked for professional use in features and capacity

• Maverick

• Capture maximum spend crossing personal / family / business use (eg: shared data plans)

• Derive maximum value / discount from loyalty to supplier

• Derive employee loyalty and convenience if family firm

• Note: local tax regime may impact attractiveness

• Administrator• Maverick

• Capture maximum ICT spend• Offer simple soft bundles with service

bolt ons across fixed, mobile, apps / cloud, storage, security

• Simplification, one throat to choke• Service / bundle flexibility• Manage growth / shrinkage more

effectively

• Maverick• Administrator

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Propositions: Mapping to personas /2Proposition Supplier value SME value Buyer persona

• Capture maximum ICT spend with curated soft bundles / selections for a particular industry

• Same as all inclusive but with more thought to vertical ‘veneer,’ likely via SaaS resale

• Simplification, one throat to choke• Service / bundle flexibility• Manage growth / shrinkage more

effectively

• Expert• Administrator

• Offer bundle of business and technology services to help early stage / launch of new business – from finance, insurance, leasing, power, devices, apps, connectivity

• Maximize annuity (3rd party payoutslikely)

• Simplification in getting business off the ground / young business working better

• Predictable costs will be valuable

• Visionary• Maverick

• Help firm undergoing major strategic change with consultative approach and migration services (eg: generational change / handover, going international, M&A, business pivot)

• One off and annuity• Issue is skills / ability to automate

• Hand holding to align technology to the new business ambition

• Visionary• Expert

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Why personas: Final thoughts

• Humanizes: Make target customer base more tangible and easier to relate to

• Simplifies: Make it easier to build more relevant and compelling digital service bundles

• Unifies: Erases internal product-centric biases and geographical divisions making it easier to execute a group-wide strategy

• Prepares: Help anticipate and act on major demand shifts ahead of competitors

• Risk of over use: Easy to identify too many personas instead of most relevant for DSP skillset

• Risk of oversimplification: Personas must be grounded in real customer data

• Demands follow through: Entire customer lifecycle must be addressed operationally

• Can get stale: The 21st century workforce is continually evolving; the use of personas demands ongoing refresh

Thank you. Questions? Camille Mendler Practice Leader, SoHo & SME Services