By Dan Shapero
Many channel partners know that just selling circuits doesn’t pay the bills anymore. What’s not always so clear is how to fill in the gaps. One hint: A recent report by research firm Frost and Sullivan on contact center modernization predicted that the cloud contact center market will grow to over $3 billion by 2017. Given that, it’s no wonder that more than 500 channel partners registered for a VIP event on the topic, sponsored by master agent CarrierSales, at the 2016 Channel Partners Conference & Expo.
The panel brought together best-of-breed cloud contact center providers for an educational discussion focused on building a successful business around this hot market. Executives from ShoreTel, inContact, Interactive Intelligence, LiveOps and Five9 shared insights on identifying opportunities and creating strategies to build a successful practice. Some areas covered: What are the drivers fueling demand for cloud contact center solutions? How do you define a target market, decipher various contact center deployment models and handle objections to cloud services? And what should you look for from a cloud contact center provider?
In this column, I’ll discuss market drivers and target acquisition. Tomorrow look for insights on models, overcoming objections and what to look for.
First off, the shift of contact center solutions from on-premises to cloud is just starting. Ray Hicken, VP of sales for contact center solutions at CarrierSales, cited IDC data indicating that just 13 percent of contact center sales are based on cloud solutions now. This means there’s still plenty of growth opportunity for agents.
When designing a message, it helps to understand what’s driving the move to cloud. In some cases, companies with limited budgets need to upgrade their existing premises-based contact centers. Other times, companies just prefer the “pay-as-you-go” model associated with cloud. This shift from CapEx to variable OpEx avoids the hardware and software expenses typically associated with a contact center deployment.
There’s good news for agents as well: According to CompTIA, 50 percent of SMBs and 63 percent of large businesses will source their cloud services through the channel because, said Hicken, they want advice from a trusted adviser. What’s more, there is a clear business case for channel partners and their suppliers to add contact center services to their portfolios.
For the channel, selling a contact center will increase commissions over selling circuits alone. Hicken says an average contact center sale can drive over $14,000 in monthly recurring revenue, with roughly $2,000 of that going to the partner. Brett Theisen, SVP of global channel sales for inContact, said his company’s partners have noticed.
Want to know more? Our in-depth report on selling hosted contact centers is free and digs into the evolving role of the contact center, the technical and financial advantages of cloud-based options, and how to help clients decide whether to move to a hosted model.
On the vendor side, Darren Gill, VP of channels and sales development at Interactive Intelligence, points out that a single-tenant architecture hosted in a data center drives up operational and support costs, while a multitenant architecture makes it easier for contact center suppliers to deploy, configure and update their services and equals faster time to market for updates to boot. A true cloud infrastructure also provides the benefit of scalability, including bursts for seasonal or rapid growth, and the service can be made accessible from a range of devices and locations.
This is a huge selling point for customers with complex requirements, including “at-home” agents. In fact, providers of premises-based solutions are buying cloud services — Brandon Knight, director of consulting services at ShoreTel, says his company recently acquired Corvisa to capitalize on the growth of cloud contact center solutions.
Channel partners building a new business around cloud contact centers can refine their markets in a variety of ways — by targeting industries, including health care, business process outsourcers, financial services, retail, insurance, public sector, hospitality and utilities, or by entering new geographies or targeting multinational firms. While the experts agree that cloud contact center solutions work for both large and small firms, multilocation businesses and those with seasonality requirements gain additional benefits.
According to Gill, in the past, cloud contact centers were better suited for small deployments of 100 agents or fewer. Now, they can deliver on large-scale enterprise requirements with many thousands of agents. He cites Intuit, makers of the popular TurboTax software, which scales from an agent base of hundreds to over 7,000 during tax season.
One twist is that it’s not always the CIO who needs to be sold on a new contact center strategy.
Rob Clarke, SVP of global platform sales for LiveOps, offered insights on targeting line-of-business managers — who often own contact center budgets — without upsetting operations and IT teams, which may worry whether they can retool and re-deploy people displaced by a cloud solution. Clarke’s advice is to use case studies from other customers to provide examples of best practices around managing vendors, setting SLAs, business process optimization and application integration.
However, be prepared: Line-of-business managers may want to avoid involving IT. You may find yourself dealing with the COO, VP of customer success or customer care, and VPs of operations, sales and marketing, who can help coach a deal through the process. The panel’s advice is to remember that IT may not always be the bad guy. In fact, says Wendell Black, VP of channels at Five9, this may be an opportunity to earn that trusted adviser status across the business.
“Sometimes starting with a project that can grow and replace a legacy system will help a channel partner get past some of the internal fighting that slows the sales process,” said Black. “For example, a company starting with a 25-seat pilot can evolve to a 2,000-seat deal in a little over a year’s time.”
Dan Shapero, founder of ClikCloud, is a highly skilled, results-driven technology marketing and business development executive. He has a track record of driving revenue growth and positioning companies for public offerings or acquisition. Shapero is a member of the CompTIA board of directors and held executive positions at Ingram Micro Cloud, Kaseya, Avamar (EMC), Vicinity (Microsoft), State of the Art (Sage) and Platinum Software Corporation (Epicor). He is a frequent speaker on topics including digital marketing, business transformation, managed services, cloud computing, cybersecurity and mobile computing.