“We’re winging it. All of us. The world goes faster and faster, and so people are finding themselves unable to read the bill before they vote on it, … or keep up with the best in the field before they do their work.” – Seth Godin
At a UCaaS Workshop in Louisville put on by Microcorp this week partners and UCaaS providers gathered to talk about selling UCaaS.
One big take away is that providers are winging it. They have no idea what their competition is doing — they have zero competitive analysis. This is reflected heavily 2 ways: (1) they keeping adding functions and features willy nilly; and (2) they cannot in any meaningful way explain their differentiation. They deflect. They say nonsense.
I cannot for the life of me understand how they can NOT explain Why them over the others. It is the question I get most often.
The other glaring point is how much work there is to sell UCaaS. Deep discovery, intense pre-sales work as well as post-install tweaks are all just a part of the process with UCaaS. As Microcorp’s Solutions Architect asked, where did the Inter-connects go? Some of that work was done by the PBX Inter-connect as part of the install fee. M/A/Cs were either fee based or part of a maintenance contract. Today, that falls on the partner.
“Someone is going to be in there selling UC services. If it’s not you, then it’s another provider,” Jonathan McCormick, COO of Intermedia.
I hear this often, but if that was actually true, then market penetration for UCaaS in the US would be more than 15%, since 2000 providers have spent Billions and 15 years pushing this rock called UC up the hill.
On a 100 seat deal, after all of the work, at an average of $24 per seat, the commission is around $480 per month. In that time, I could have sold and installed many Internet pipes and made more money. In that time, I could have sold a Managed IT contract that is far stickier and easier.
The compensation versus time spent is just one problem the sector faces.
Microsoft and Cisco – even Avaya – are going to own many big accounts for years to come; and as all the providers move up market to make their revenue needle move, it will get harder and harder to sell and maintain the client.
Without a better deployment and customer experience, churn will stay the same. Partners will get frustrated. Yet how do you throw bodies at the CX when the price per seat is going down? Without Branding and Differentiation, the seat price is how the deal is decided.
Some of the partners in the workshop were MSPs and some were agents. The ones doing the most work for the sale were charging for the pre-sales and post-sales work. That is the only way this makes financial sense. (That and going back to upsell!)
The first point made at the workshop was that if you are just replacing what the customer has, then they will be disappointed – because they will be paying more for the same thing.
I have written before how UCaaS is a solution without a problem. It still holds true.
The providers keep bolting on functions like video conferencing, collaboration, contact center, analytics, chatbot, CRM, contact management, et al, on their way to becoming a Platform as a Service for a business. This would be a decent idea if the SPs were targeting companies with 150 employees and less, but they aren’t.
Instead of spending $100M on a new Contact Center function, how about making the implementation better, smoother?
I would think businesses – even those paying $60 per POTS line – are going to buy UC for POTS replacement and flat rate dial-tone. (I have seen it often.)
Partners pointed out that customers already have MS Teams, Slack, Salesforce, Dropbox and Zoom, so why would they want a whole platform from one provider? A couple of providers said that some companies are looking for one throat to choke. My thought runs to “How do you change User behavior?” They are used to Dropbox, Slack, Zoom. How do you make them switch? User adoption is another problem that the industry faces.
Also, user interface… it is why there is adoption of Workplace by Facebook despite a small sales force.
It is hard to believe that it has been 15 years since I was first involved with Hosted PBX. The industry has not come a long way since then. It is disappointing in so many ways.
Two more points:
Stop saying “We Suck Less.” It isn’t funny anymore. It implies that you don’t want to make the improvements necessary to not suck. Heck, you don’t even know what the Suck Factor is since you know next to nothing about your competition!
As partners we don’t want a vendor who sucks less. Do you see MS saying we suck? Even though the Blue Screen of Death has been a joke for years!
Years ago, the CLECs would point at the ILEC and blame everything on them. Today, services like SD-WAN, UCaaS and Managed Services do NOT rely on an incumbent. It is all provided by the CLEC. So any suck-a-tude is your own. If you suck at UCaaS, then get out of the game.
Last point: There is already an AT&T. The ILECs have all been the default for voice, data, video, etc. for a long time, covering 1-100,000 employees. They aren’t that good at it. Stop trying to be AT&T!! Pick a segment of the market and be the Slack for that segment! Be the Lyft for the 20-100 employees! Because it isn’t about going wide and shallow. You can’t win going wide and shallow. Besides AT&T, Cisco, Verizon, Comcast, MS have one thing that none of you have: a Brand. A Brand worth billions of dollars supported by billions in marketing — and anyone can say “You can’t get fired buying from them!” They can’t say that about your company!
Next thoughts are PaaS vs. CPaaS