A marketing path for mid-market telecom competitors

The commercial mid-market for integrated communication services is an elusive gem. Yet mid-market competition seems ready to surge as the wireline needs of these firms are underserved by increasingly outmoded T-1 and TDMA circuits.

Mid-market telecom revenues are reported as $25 billion annually. This represents promising, new sources of revenues for competitors such as Level 3, which recently announced renewed mid-market plans, and for the many other integrated communication service providers that have developed unified IP product sets, including voice over IP.

Cable's entry into the mid-market as a facilities-based competitor may be a different order of magnitude because it has the resources and motivation to replace slowing residential revenue growth. From dialogue with the management of cable operators it is evident that cable is actively planning and building network extensions from their traditional residential areas into small- and medium-sized business areas, and they are deploying their newest technology with Ethernet being favored.

Cable's methods for serving residential customers appear to be largely transferable to serving small business customers, but the mid-market telecom customer requires a different approach. Solutions selling, sales engineering and project-managed installations are needed for mid-market customers due to their more complex requirements.

Switching opportunities certainly exist as troubled economic times make mid-market managers frugal and receptive to changing the who and how of networks, applications and, in some cases, IT infrastructure management. They are disposed to utilizing software-as-a-service and virtual servers to control IT expenses by making them into variable costs rather than fixed costs.

How can new entrants change the game against determined resistance? They need to be organized in the most effective and efficient structure; the client experience needs to be exceptional. Here's a path for competitors to consider:

FIRST, define your market. There is no fixed or firm definition of the mid-market. It can be defined by the number of employees or revenues or the type of services businesses are willing to buy. Employee size can range from 100 to 15,000 employees, and revenues can be between $10 million and $500 million. The key is to be committed and don't constantly adjust your definition.

SECOND, develop your offers. You need to assess your offers and compare these to your competitors; you need to match your current offers with clients that have the greatest propensity to buy while maximizing profitability. Leverage your portfolio. Develop your message and be consistent in collateral and launch material.

THIRD, design the optimal sales structure, the metrics, measurements and incentives needed to create a winning sales culture. Assess your existing team and develop an optimal plan for team placement. Your design should include the ideal mix of alternative sales approaches and distribution channels, including direct and indirect sales, inside sales and unconventional sales channels.
If you don't have one, create an interview guide to assist with recruiting and placement. Partner with your HR organization to develop competitive compensation and incentive plans and, finally, develop a strong internal communications packaged. Provide a vision for your team and be willing to commit a significant amount of your personal time from the leadership.

FOURTH, find additional growth drivers. There is always opportunity to expand current portfolios but doing so in a way that will optimize expense, time to market and revenues is critical. Leverage your existing assets to differentiate you from your competitors. Add third-party services that will lift average revenue per user and reduce churn rates. Build marketing campaigns and customer loyalty programs that incent growth. Don't get bogged down in your own bureaucracy. Consider establishing a fully integrated development and launch team.

FINALLY, you must execute flawlessly.