When it comes to business customers, bigger isn’t always better. When most UCaaS vendors, for instance, talk about the service capabilities, the focus inevitably turns to the upper end of the market with upwards of 100 or even 500 seats; rarely are businesses with fewer than 20 seats mentioned as a strategic target. Naturally, larger companies represent high-value targets – larger customers come with larger monthly spend. But, there are several reasons why very small business communications opportunities should not be overlooked as a significant revenue stream.
First and foremost is the sheer size of the market. Businesses with fewer than 20 employees comprised two-thirds of the 6.8 million registered businesses in the United States alone according to the U.S. Census Bureau – that’s about 4.5 million potential customers. With 10-12% turnover year-to that also means a host of brand new businesses looking for quick deployment options, a clear strength for cloud providers.
In addition, small businesses tend to run on much shorter sales cycles, bringing in revenue faster – and revenue, any way you break it down, is revenue. With fewer users per company, support demands on providers are inherently lower. In fact, very small businesses can be ideal targets for self-serve deployments, making the entire cycle very hands-off.
Resources & Support
Small businesses and startups, by nature, have two other attributes that lend themselves ideally to hosted services. They have limited IT resources and an economic structure that allows for very little up-front capital spend, prime reasons for opting for cloud UC. In addition, a lack of IT teams means they don’t have the ability to manage their own systems. Still, they need the versatility of a device and location agnostic solution to accommodate team members in multiple locations, including home offices.
Small Business Communications Add Up To Big Payouts
So, while the per customer monthly revenue is relatively small compared to larger businesses, the incremental revenue from focusing on a market most providers are largely bypassing is a sizable opportunity in a competitive market; the limited resources and time required to sell and deploy to very small businesses can make a very profitable venture. Furthermore, because cloud solutions scale easily, they can accommodate growth as small business communications demand more functionality to handle increased competition.
The bottom line: there really isn’t a market that isn’t well-suited for Unified Communications. The functionality and integration with other systems may be dependent on customer size, but the fundamental value of Unified Communications and collaboration solutions holds for all businesses. Mobility, rapid deployment, flexibility, device independence, integration with other software, and scalability all allow businesses to communicate more effectively internally as well as with customers. And with customer experience being such a high priority, consistency of communications is also a must--another advantage of a cloud-based or on-premise cloud system, which supports business continuity regardless of unexpected circumstances.