SIP Trunking: Grow revenue from existing customersJanuary 9, 2009 —
Grow Revenue From Existing Enterprise Customers by Micah Singer, CEO, VoIP Logic
In the next several issues of Telecom Reseller I will detail a strategy that many PBX vendors, IT services companies and other software, systems or data management firms have considered in the past few years – SIP Trunking and PBX features as a service.
SIP Trunking is the fastest-growing segment of the VoIP market. Essentially it provides PRI/T1 replacement, which allows providers to capture more usage revenue and immediately saves the enterprise 10-40% on the largest aspect of communications costs, telephone calls.
PBX vendors, IT services companies and outsource LAN managers across North America are in an excellent position to extend their trusted relationship with SMBs but there are several factors that lead these companies to largely abstain from this tempting and lucrative market.
These articles will address what seems like a challenging transformation into six steps that may cause organizational change but are well within reach for most companies reselling IP and traditional PBX systems as well as those providing data or LAN services to small and medium enterprises.
Inbound (toll-free and direct inward dial) and outbound telephone calling account for approximately 1,100 user minutes per month. Today this revenue is captured by traditional telecom service providers that sell $20-$30 per user per month depending on the mix of calling destination (international callers spend more). Using a 50-person enterprise as an example this translates into $12,000- $18,000 per year. In addition to usage costs most enterprises above 25 users at a single location tend to pay for a T-1/PRI circuit at approximately $500 per month, for a total annual cost of $18,000-$24,000.
Providers that sell SIP Trunking have a very compelling value proposition for their enterprise customers – save $6,000 to $12,000 annually. I believe PBX vendors, because of their existing relationships, geographic proximity and trusted status, actually provide an even more compelling value.
Offering SIP Trunking can deepen the existing enterprise-provider relationship, save money, add substantial revenue, move a step closer to single-sourcing key communication systems, and unlock the next-generation of value-enhancing services. There are six steps to tap into this new opportunity.
1.Think like a service provider – transition from thinking like a software support to a solution support company.
2.Choose quality network vendors – insist on performance even when it costs more.
3.Cross-train technical personnel – solve more customer problems from a single source.
4.Choose backend systems for call processing and invoicing.
5.Avoid fixed costs – opt for on-demand options that match actual growth.
6.Understand customer needs and wants – be prepared to offer services that extend and enhance SIP Trunking.
In the next article I will go into detail about what it means to think like a service provider. Understanding how to transform an existing software, hardware or LAN sales and support organization into a communications network services company can open the door to this large opportunity.
Contact the author at micah@voiplogic.com.
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