In February 2021, Phase 5 partnered with B2SB (Business to Small Business) agency Cargo to conduct a study of over 2000 small & medium businesses (SMB) in North America. Our research explored drivers of SMB purchase and loyalty behavior, and investigated what they currently fear, forecast, want, and need from enterprise brands. This article is the third in a series that highlights the study’s key findings by industry vertical, and is focused on what enterprise providers of telecom (internet & phone) services need to know.
With respect to SMB decision making, peer to peer is the #1 most trusted source when owners & leaders go looking for referrals. That means that your NPS (Net Promoter Score)1 is a pretty important metric! In our State of SMB 2021 study, we learned that the overall NPS for current IPPs (Internet & Phone Providers) is -10, indicating that there are currently more detractors than promoters in this sector.
What does this mean? There is definitely room for improvement, and considering that 54% of SMBs are considering switching providers, the time for action is now. Read on to learn about what matters most to SMBs in this post-pandemic world so you can build customer loyalty and create advocates, improving your NPS score along the way.
Getting the Job Done Efficiently
Whether on a personal or professional level, everyone knows how frustrating it can be when your telecommunications system fails you. Consider the frozen video call, the timed out online purchase, or the inability to load a document. For small business owners, these experiences are more than just frustrating; they can be anxiety-inducing, as good customer service (i.e. sales) and efficient operations (i.e. cost control) both depend on reliable internet & phone service, especially in 2021.
When we asked SMBs if they are satisfied with their IPPs in terms of the “time it takes to accomplish what <they> set out to do in digital channels”, only 25% gave a top 2 box answer (9 or 10 out of 10), while 38% reported being unsatisfied. This number seems alarmingly high, once again considering the potential business impact of systems that don’t always work.
If we hypothetically follow that customer journey from a failed system experience through to the customer support experience, 40% of SMBs say that customer support from their IPP is below the “good” level, and as many as 44% do not agree that they have had a positive experience working with their IPP. Clearly SMBs need more than they are currently getting from their internet & phone providers.
Excelling at Innovation
2020 was a year when every business, big or small, had to pivot in response to the pandemic. For small & medium businesses especially, the stakes were high. Making it through to 2021 was a major accomplishment, and so we asked our SMB respondents to tell us the top 3 things they learned over the course of the last year. While the number one answer was “to have financial reserves”, the number two answer was “to be able to adapt to changing circumstances” (48% ranked it in the top three).
Agility and creative problem solving are key to business survival when the rules and regulations continue to change. With that in mind, we dug into how IPPs are performing with respect to innovation in the eyes of their SMB customers. The answer? 44% of SMBs disagree that their IPP “excels at innovation”. This issue is even more pronounced for smaller SMBs, as 49% of them disagreed with the statement above.
Telecom providers have an opportunity to better support their SMB customer base with more innovative solutions. Given the combined size and impact of the SMB segment2, this opportunity may warrant further investment by enterprise marketers. Research can help identify the biggest gaps and unmet needs of a specific customer base in order to appropriately narrow the scope and optimize return on investment.
Making Them Feel Valued
In addition to (a) expecting reliable, efficient service, and (b) wanting help with innovative solutions to their unique challenges, SMBs want to feel valued. Of course you may have larger clients, and SMBs understand that, but they shouldn’t feel second class when they’re dealing with you. They are still paying customers with businesses of their own to operate.
We asked SMBs how satisfied they are in terms of their IPP making them feel valued as a customer, and nearly half (43%) gave a mediocre response at best (i.e. rating 6 or less out of 10). For smaller SMBs, the number skyrockets to 58%, suggesting this important and growing segment is being overlooked when it comes to the large enterprises that serve them. The good news is that across the board, larger and older SMBs feel more valued, supported, and that their needs have been met by IPP vendors in comparison to their smaller and younger counterparts.
Regardless, the words in our State of SMB 2021 Telecom Sector Report must be noted:
“We have seen time and time again how strong, resilient, and adaptable Small Businesses are. It would be a mistake for your brand to dismiss their needs and their potential to recover.”
Summary
In the post-pandemic world, telecom service is perhaps more important than ever before for small & medium businesses to do business. Over half of SMBs are currently considering switching Internet & Phone Providers, and they’ll be looking at peer reviews to make their decision. Telecom enterprises can strengthen customer relationships (leading to more customer advocates) by ensuring efficient, reliable service, offering innovative solutions, and always making their SMB customers feel valued. Improvements will be reflected in higher NPS scores.
As there are many different types of SMBs, specific definitions of efficiency, innovation, and value will of course vary. Through custom research, Phase 5 can help your enterprise make the best strategic decision in order to retain and build your SMB customer base. Please contact us to learn more details about the State of SMB 2021 study (including specific results for Canada / the U.S.), or to schedule a discussion about your particular business.
1NPS is a rating from your customers expressed as a number from -100 to +100; it is negative when you have more detractors than promoters, and positive when the opposite is true.
2Over 99 percent of America's 28.7 million firms are small businesses. (https://www.jpmorganchase.com/institute/research/small-business)
2As of December 2019, the Canadian economy totaled 1.23 million employer businesses. Of these, 1.2 million (97.9 percent) were small businesses (https://www.ic.gc.ca/eic/site/061.nsf/eng/h_03126.html)
