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Excerpt from Cyber Agent
Telecom Portals Put Purchasing Power in Hands of Small Business
By Gail Lawyer
October 2000
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Small businesses are often left to their own devices to figure out what kinds of telecom services and products they need and where to find them. But within the last year, businesses of all sizes, and even residential customers, have been able to tap into any number of telecom portals to gain an education on new technology and services, compare and contrast service plans and product prices, and even order services online.
These telecom portals, in essence, have become something of a cyber agent, creating a new sales channel for telecom service providers and equipment vendors.
Forrester Research Inc. (www.forrester.com) predicts that online sales of telecom services to U.S. businesses will reach $47 billion by 2004. Forrester's July 2000 report, "Buying into Telecom Online," concludes that corporate buyers hate the current procedures for procuring telecom goods and services, and that within two years about 65 percent of them expect to purchase some of their telecom services via the web.
"We are in the business of giving customers the ability to make decisions about suppliers and the services they offer," says Chet Thaker, president and CEO of TeleBright Corp. (www.telebright.com), whose website features its proprietary IntelliRate database, which enables users to compare more than 800 different calling plans for approximately 60 service providers. The site launched in June.
Small businesses, such as those TeleBright is trying to attract, often fall below the radar of major national carriers because the cost and effort of selling to smaller business is greater than the returns made on the services they buy.
"We know for a fact that it's cost-prohibitive for major carriers to put a sales force out in front of small and midsize businesses," says Ed Heichemer, executive vice president of marketing and strategic development for TelecomSmart.com Inc. (www.telecomsmart.com), a site that has been online since April. "So we're trying to use the Internet to reach out to millions of small businesses."
Not only do these sites give small businesses power to seek out the best deals, they also give the service provider a new, inexpensive-to-maintain sales channel.
Source of Leads
"Our site gives them a source of leads that they can get easily. All they have to do is give us their calling plans to enter into our database," says Thaker. Telecom portals with the ability for customers to purchase directly from the site also shorten the sales cycle and give service providers a chance to reach a market segment that is difficult to get to--small and medium-sized businesses and high-end residential customers, Thaker says.
TeleBright got its start because its founders had been active in creating sales decision support applications, including a database of service providers and calling plans, which eventually morphed into IntelliRate. "We thought rather than offering [the database] to individual suppliers, why don't we put the capability on the net," says Thaker.
TeleBright also offers its IntelliRate database to other portals, such as TeleMerc.com Inc. (www.telemerc.com), and is paid commissions on all the sales that result from the database's use.
From its own site, TeleBright, like other telecom portals, also gets commissions from service providers once a customer signs up. The commissions are typically based on standard agency program agreements.
Because it has similar agreements with all service providers featured on the site, TeleBright doesn't try to steer its site users to any one particular carrier. "We play no role except the price analysis," says Thaker. "We're absolutely neutral until the customer makes its decision." At that point, TeleBright facilitates the service order and activation, and follows up with customers once service is installed to ensure everything went as promised.
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