By underinvesting in advanced analytics in their B2B business units compared to their B2C operations, telecommunications corporations are losing money.
These segments can produce the growth and margins that are desperately required with a new, personalized approach.
Telecommunications businesses have historically focused their analytics efforts on their more prominent B2C sector, specifically on uncovering new sources of value in this segment, due to rising pressure to achieve growth and greater profits.
Yet the B2B segment, which can account for up to one-third of total revenues and boasts higher margins than B2C, represents a relatively untapped opportunity.
We suggest operators that harness the potential of advanced analytics can capture substantial additional revenues through customer retention and acquisition while reducing operating costs.
Businesses must first adjust their B2B analytics playbook to the specifics of the market. The discrepancy between B2B and B2C analytics capability in high-tech and telco industries was discovered by the McKinsey Analytics Quotient survey.
When it comes to the aspects of analytics strategy, culture, organization, data, models and tools, and value assurance that are essential for harnessing the benefit of analytics at scale, B2B frequently lags behind B2C.
B2B Telco Challenges
We work hard to ensure that people with disabilities have full access to our website. The good news is that telcos can experience considerable gains if they use analytics expertly to their B2B operations.
Operators may employ analytics and digital to increase revenues by 5 to 15% while lowering costs by 15 to 35%.
High-impact use cases can capture significant revenues and cost reductions. We work hard to ensure that people with disabilities have full access to our website. We would be pleased to work with you if you would want more information on this topic. There are substantial differences between segments.
Based on several variables like customer size, order value, transaction volume, contract duration, and buying behavior, operators often categorize their B2B units under distinct lines of business.
The small, midmarket, and enterprise segments may be included in these divisions. The public sector, local health, and education, together with the retail and wholesale industries, are typically the emphasis of vertically oriented organizations.
Due to the variances across B2B segments, a tailored analytics strategy that prioritizes certain use cases for each segment is necessary.
Small-business customers, for instance, frequently have characteristics that are similar to B2C segments; they are more transactional and have shorter sales cycles.
Telcos are hence more inclined to employ conventional offers, pricing, and terms. In contrast, the enterprise market is characterized by fewer, larger clients, six to nine-month sales cycles, and highly individualized proposals and contracts. There are several other critical differences to keep in mind:
Complexity and variety of the products
B2B is distinguished by substantially greater product complexity and diversity. Compared to consumer purchases, business purchases generally contain a broader, more varied range of value-added services, such as professional services, support tiers, and a range of managed services (such as security and VoIP). paths and channels to the market.
B2B channels include those more frequently linked to consumer sectors, such as call centers and retail stores, as well as direct and indirect feet-on-the-street sales channels.
Operators must consider the extensive change management required to integrate analytics into their operations earlier in the process to secure the best ROI in order to improve performance at scale in this complicated environment.
B2B Telco Opportunities
Data shortages and particular data needs. In our experience, B2B segments have more pressing concerns with data availability and timeliness than B2C segments.
Three to five days after the end of the month, one global operator had access to a wide range of data for B2C wireless devices.
However, for virtually the same B2B service, recent updates and scant historical data were not available until two to eight weeks following the end of the month. In order to start moving forward, B2B operators have had to find ways to get around these constraints.
Decision-maker heterogeneity. Decision-makers in B2B can vary depending on the segment. In small businesses, it’s typical for one manager to be in charge of all purchasing decisions for only one location.
Such purchasing decisions are frequently more centralized among midmarket and enterprise customers. The analytics strategy used by a telecom and the execution plan must be customized to the distinct purchasing habits of each segment.
Once operators have identified the unique characteristics of B2B, they must then adapt their analytics approach accordingly. Successful operators do so along three dimensions:
1. Adopt a segment-driven view of the opportunity
Operators cannot adopt a one-size-fits-all strategy due to the pronounced variances between B2B segments. Leading telcos are focusing on more “B2C-like” prospects in retention, acquisition, or cross-selling for smaller client segments.
In order to improve the value proposition for customers while maximizing value for the telecom, pricing can be addressed by analyzing various plans.
Leading telcos are, however, leveraging advanced analytics to seek new prospects for enterprise customers.
In order to maximize sales techniques, these initiatives can involve raising sales productivity, expediting contract discussions, and estimating transaction prices and chance of success.
For instance, a worldwide integrated operator employed analytics to estimate customer lifetime value in its small-business market in an effort to boost client acquisition, cross-selling, retention, and migration.
However, the telco emphasized use cases based on patrons’ purchasing patterns as it progressed to the midmarket and enterprise divisions.
The chosen use cases, which included optimizing sales agents and utilizing dynamic deal scoring and share-of-wallet analytics, were calibrated to enable upselling opportunities while the focus remained on increasing customer life-cycle value.
2. Prioritize data sets on usage, service history, and product performance
Given the variety of items they purchase, B2B clients frequently place a high value on service levels, uptime, reliability, and customer satisfaction indicators.
The businesses and their end customers are two kinds of stakeholders who are impacted by any decline in service levels. B2B analytics initiatives should focus and include all available data on consumption, service history, and product performance in comparison to rival telcos.
Since insights obtained from these data sets appear as higher propensity features in predicting the likelihood of a customer to stay, buy more, or join as a new customer, this data should be combined across all customer engagement channels, including chat, email, inbound calls, and field sales notes.
A service interruption can influence a customer’s decision to buy another product from the same company, so telcos should combine this service history across all of their products.
For instance, at one North American operator, slow broadband speeds relative to those of its rivals resulted in increased turnover rates for both its broadband and cellular product lines since customers blamed the business as a whole for their bad experience.
The operator developed a marketing campaign across all zip codes where its speeds lagged behind those of rivals after using analytics to identify the reason for the exodus, bragging about its superior wireless service and performance and integrating incentives on internet rates. The churn was significantly reduced as a result of these initiatives.
Operators must prioritize diverse internal data sets in addition to investing in locating special external data sources in order to gain more insight into their customers.
This strategy has already shown potential in the B2C market, where operators have been able to build a platform for consumer behavior data thanks to an ecosystem of new partners that includes software providers, identity management firms, and social media platforms.
Given the difficulty of data collection in B2B, where a significant percentage of SMEs may cease operations in their first few years of operation, a comparable ecosystem is still developing.
Operators should perform a structured analysis of the information provided by outside suppliers (such Dun & Bradstreet, Lattice, and ZoomInfo) about their B2B clients or prospects, even if only at a high level.
3. Use data to improve decision making at the point of sale
Field and inside sales—both internal and partner-led—facilitated by human connection are frequently necessary for upmarket B2B segments.
In spite of this, one-on-one communication increases channel complexity and calls for extensive change management, which may involve delivering agile and automated campaigns through call centers and digital channels.
Leading B2B telco companies frequently make investments in broader change management and capability building, which may include on-site field training and creation of capabilities.
Additionally, they make investments in the realignment of sales roles and channel mix, a performance management system with leading and lagging indicators integrated into regular reviews, an incentive system that encourages the adoption of new technologies and the right behavior, and customer relationship management systems that integrate data and analytics into workflows for sales forces.
One of the industry’s largest operators implemented a thorough sales training programme concurrently with an analytics transformation to educate field representatives on the use of data to inform point-of-sale decision-making and to solicit their input.
This endeavor included giving frontline salespeople the tools they needed to compare rates for renewals and new customers at the point of sale, raising booking value by 5% and reducing needless variation in discounting.
Telcos can no longer afford to ignore any potential sources of revenue in their pursuit of sustainable growth due to the increasing margin pressures that are being worsened by necessary investments in capital expenditures and other business sectors, such as content and advertising.
If analytics and technology are used methodically, B2B telco initiatives can be a rich source of revenues and profits.
Lift-and-shift techniques, however, are insufficient. Operators must comprehend the particular context and difficulties of B2B in order to create their analytics techniques appropriately.
Need help with B2B strategies to advance telecommunication thresholds? Let’s talk!