The robustness of any industry can be measured not only by the number of large vendors seeking to fortify their market-share, but also through SMEs aiming to carve out their own niche.In case of the Indian BPM industry,SMEs have an interesting opportunity to challenge established players. Although the SME’s may not have the ability to participate in cut-throat pricing wars, they can definitely compete on the value and services they offer to their clients.
“By means of verticalization SMEs will be able to bring focus on specific business issues in a vertical domain such as Banking, Insurance, Healthcare etc.”
SMEshave the advantage of flexibility and speed in implementing targeted Sales and Marketing strategies. Not only can they win new customers with a good strategy, they can actually pressure larger vendors in some situations by influencing the buying behavior of customers.
The success of a sales and marketing strategy is not limited to hiring talented sales professionals. The secret to the success of a sales strategy lies in the approach that is usedto reach new prospects and improve conversion rates.SMEs must adopt the approach of specializingin the vertical industry and they must use customer centric thought processes for channeling sales efforts.
By means of verticalization SMEs will be able to bring focus on specific business issues in a vertical domain such as Banking, Insurance, Healthcare etc. Embracing acustomer-centric approach in designingproducts and services will aid SMEs in the long run by helping themattract new customers and retain the existing ones.
1. Explore the potential of Verticalization : SMEs should specialize on specific processes in their chosen verticals and lead through domain knowledge. Targeting multiple customers in the same business segment helps with designing innovative solutions and reduce costs of training and transition when acquiring a new customer. Companies can embark on their journeys of verticalization by following means:
- By capturing early trends in a business vertical and developing products specifically that can take advantage of a new trend in the industry.
- Addressing changes in regulatory or compliance requirements early for a vertical can bring significant new business to a SME.
- Mapping their current product and solution offerings to the requirements of new business verticals
- Partnering with an anchor client in the verticals can help them capture several others in the sector.
- Looking at Inorganic growth opportunities through alliances with other sectoral niche players
An example of this approach is Barkawi Management Consultants, a supply chain management consultancy and BPM vendor. Barkawi was eventually acquired by Genpact to strengthen its service offerings and to widen its customer base in the supply chain management sector.
Another example would be of a BPM company specializing in healthcare sector. This company can consider partnering with an analytics firm to leverage its capabilities. This will provide the company an entry into the healthcare analytics sub-sector. The company can also enter into the healthcare insurance sector by offering insurance claim settlement support to its existing healthcare clients.
In order to make the verticalization strategy a success SMEs will have to expand their avenues by going omnichannel and by partnering within the eco-system.
2. Why go Omnichannel : SMEs must deliver a consistent customer experience that engages prospects and customers across multiple channels.
On the website front, SMEs can accomplish this by infusing contextual digital self-service into the existing web & mobile sites of the company. In this way SMEs will be able to reach out to customers, before they abandon their websites for unanswered questions.
SMEs must engage in developing customer engagement platforms by putting to use virtual agents, web and mobile self-service, automated chat dialogs, or chatbots. This will help them in maximizing the lifetime value of their customers and help reduce the costs of serving customers. It will also offer a consistent, unified, and personalized customer experience.
Optimizing contact centers for omnichannel efficiencies is crucial for business success. On the contact center front; SMEs must invest in exploring the potential of RPA and machine learning to automate end-to-end processes and empower customer service agents.
3. Why Adopt the Partnering approach for business growth : Most of the SMEs in BPM sector conduct sales through referrals and direct sales. Indirect sales is less prevalent. Strategic partnerships with system integrators and technology consulting firms will accelerate sales and add to the capabilities of SMEs. A strong partner base will expand the avenues of customer coverage and solution delivery capabilities for SMEs. Apart from partnering with players in the eco-system, establishing strong customer-vendor relationships will help SMEs outperform their competition.
Through Verticalization and Partnering with Key Technology vendors, SME’s can acquire new customers at a faster rate than their larger competitors. By providing an Omnichannel experience they will, not only be able to achieve higher conversation rates but will be able to convince their customers to even outsource more of their critical processes. Successful SME’s can grow at a much higher rate than the Industry growth rate of 9-10%, if they are consistently ahead of their Customer’s requirements.