Meet Communications Customers
Learning Objectives
After completing this unit, you’ll be able to:
- Distinguish between B2C and B2B customers.
- List examples of key communication customer segments.
- Describe the different channel and product requirements of key customer segments.
- Outline the benefits of using market segmentation in the communications industry.
Communications Customers
Group your customers into market segments to provide your communications customers with the best targeted products and services.
At the highest level, your customers are identified as consumers or business customers. Supplying to consumers is known as the B2C (business-to-consumer) market, whereas supplying to business customers is called the B2B (business-to-business) market.
The customer’s type of business often further segments the B2B market. Generally, B2B markets are segmented “firmographically,” that is, by organization characteristics such as size or industry. The segments vary from one CSP to another depending on the classification scopes set by the CSP.
Here are some commonly used communications market segments.
Consumers
Consumers buy communications products and services for personal or household use, rather than for business activities. Due to the nature of their business, CSPs often have access to huge amounts of consumer data from sources such as contract information, usage data, and billing information. CSPs then use this information to segment their consumers into demographic segments such as location, age, occupation, and gender, and behavioral segments such as product usage and prior purchase behavior.
Consumers often compare products, services, and prices online across multiple vendors before purchasing through ecommerce sites, online portals, or physical retail stores.
Popular products and services include quad play bundles, where TV, internet, fixed line, and mobile products are bundled together. Popular consumer pricing models include flat rate pricing combined with ad-hoc purchasing, like buying mobile apps or streaming purchased movies on top of a fixed monthly mobile line rental.
Small Businesses
Small businesses have a small number of employees and lower turnover than their mid-market or enterprise counterparts. Self-employed individuals, partnerships, and small privately owned companies are all considered small businesses. Some small businesses, like retail storefronts, hairdressers, small law firms, and tradespeople, may require specific types of communications products and services from their CSP.
Small businesses may not have staff in-house to support their communications requirements. They often use an intermediary, such as an IT consultant, who works in partnership with the CSP to implement and support their communications requirements. QubeGB is an example of an intermediary. Read more about QubeGB in the Resources section of this unit.
Alternatively, small businesses may access a dedicated CSP small business portal or contact center to research and purchase their communications products and services. CSPs often bundle services for small businesses, including internet, fixed line, mobile, cloud, and security products to support their requirements.
Medium-Size Businesses
Gartner defines mid-size businesses as organizations that have between 100 and 999 employees, or those with between $50 million and $1 billion annual revenue. However, this guideline is arbitrary and may be defined differently at your company. Often, small and mid-size businesses are bundled together into a category called small and medium size enterprises (SMEs).
Medium size businesses likely have internal IT experts who interact with CSPs to research and purchase appropriate communications products and services tailored to their requirements.
Enterprises
Enterprises are large companies, like Walmart, Apple, and UPS; they often feature in the Fortune 500. Enterprise communication requirements are likely to be complex and large in scale compared to those of small and mid-size businesses.
Enterprises have internal communications experts to manage the purchase and implementation of a complex range of communications products and services. They’re also likely to buy from multiple CSPs. Thus, most CSPs have dedicated account executives assigned to large business accounts to build and maintain enterprise business.
Government or Public Bodies
Government or public bodies are often similar in size to enterprise customers but tend to have strict regulations and procurement processes controlling both what communications products and services they buy and how they buy them. Sometimes this includes requiring sealed bids and tenders to ensure the process is transparent and accountable. Often CSPs will have account representatives with in-depth knowledge of the government procurement process who work closely with specific government departments or public bodies on their product and service purchase requirements.
Employees
When an organization buys communications products and services and then provides its employees with a portal to the CSP to manage its products and services, those employees become a distinct communications market segment. Those in the employee segment have similar requirements to B2C consumers, but they’re controlled by the boundaries set by their employer.
Wholesale
Wholesale customers are a common feature of the communications industry. They make large purchases of similar products and services, then sell them at profit to their own customers. For example, Nokia may provide mobile phones to large distributors such as AT&T or Vodafone, who then sell those phones as part of a mobile package to their B2C and B2B customers. In this scenario, AT&T and Vodafone are in Nokia’s wholesale market segment.
Why Do I Need to Know About Communications Market Segmentation?
Although some products, services, and businesses are shared across all customer groups or segments, most segments have their own products, services, and pricing. Some business processes are designed for particular segments. Most large CSPs cater to all market segments, with different roles and sales channels to support different customer segments.
Traditionally, consumers and SMEs went to retail stores to buy products and services and to get support. Now they often use self-service portals and ecommerce sites. In contrast, large enterprises and government customers have more complex service and regulatory requirements so they generally have dedicated direct sales and support teams.