For telecommunications companies today, the race for consumer market share is a grueling marathon with high overhead costs and finite opportunities for growth. The real prize lies within the B2B telecom sector, which harbors vast uncharted territories promising lucrative revenue streams and sustainable business models. Adept telcos that pivot their focus toward B2B can harness this burgeoning potential.
The B2B opportunity in telecom
The global B2B telecommunications market is experiencing explosive growth, with projections estimating it to reach $181 billion by 2030—a CAGR growth of 14.8% from 2021 to 2030. This can be attributed to the fact that the B2B sector has finally embraced digital and most have started the process of digital transformation. As a result, they have an increased need for high-speed connectivity, required for everything from cloud computing to mobile applications. As Darshan Naik, Chief Growth and Strategy Officer of Telco, Media and Technology Markets at Capgemini shared in a Forbes article, while connectivity is the primary opportunity for telcos to tap into the B2B market, providing additional services such as network infrastructure, private 5G, network scalability and security is where they can truly gain a competitive advantage.
Private 5G is a major growth opportunity for telcos—with many enterprises seeking improved range and reliability without the challenges associated with shared networks and satellites. The revenue growth potential for these value-added services is limitless—and remains largely untapped.
CHIEF GROWTH AND STRATEGY OFFICER, CAPGEMINI
A McKinsey report, “Technology and telecommunications B2B customer buying trends,” released in February 2024, provided further reinforcement that telcos would be remiss to ignore the opportunity in the B2B sector. The advisory firm presented survey results showing that over half of enterprises intend to increase their spend across a range of connectivity and technology products in the next year. It advised that telcos should view this positive market outlook as a “wake-up call,” suggesting that they “need to accelerate their efforts to find a compelling value proposition that allows them to play a greater role in the ‘beyond the core’ space.”
A strategy for growth
In How Telecom Leaders Can Win the B2B Market, Bruno Teuber, Chief Revenue Officer of commercetools, stressed that a telco cannot expect to successfully enter the B2B market simply by redirecting its efforts. He proposed that telcos need to tackle two key requirements: “First, a recalibration of services and sales approaches to harness the burgeoning demand for high-speed, business-focused connectivity solutions. Second, a tech-agnostic, composable architecture that allows you to launch faster, experiment easier and move away from heavily depending on IT — i.e., a faster time to market with a lower total cost and risk.”
Bruno explained that the B2B customer is very different and, “a telco has to fundamentally remodel and uplevel its sales tactics similar to the approach with consumers.” This requires making strategic adjustments including developing B2B-specific offerings, pricing models and marketing campaigns, as well as forming specialized B2B sales teams and partnerships.
However, even more critical is having technology in place that can both support the unique requirements of B2B and the scale of enterprise business needs. In a recent TM Forum webinar, Fredrik Roos, Telco Commerce Expert at Bluestone PIM, a commercetools partner, shared that many telco platforms are built for consumer requirements and legacy systems. “The B2B solutions require completely new functionality and business support — the ability to customize product assortment, catalogs, bundles, data plans, etc., with specific customers or customer groups is crucial to be successful.”
In the same webinar, Einar Augedal, CEO of Bluestone, explained that moving to a composable architecture gives telcos “the opportunity to be more flexible and agile, and also deliver new services and offering to to the market faster.”
Composable commerce: Aligned to achieve B2B ambitions
From a big picture perspective, composable commerce empowers telcos to deliver agile, customer-centric B2B solutions, enhancing their ability to expand into, and succeed in the market. Because the approach allows for incremental adoption, telcos are not forced to immediately abandon their legacy operational and business support systems (OSS/BSS). This is particularly attractive to large telcos that fear change because they have grown through acquisitions and have multiple disparate systems.
The benefits composable offers are essential for addressing the complex and diverse needs of B2B customers. Here are the key reasons:
Flexibility: Composable commerce allows telcos to select and integrate best-of-breed components tailored to their specific requirements, enabling them to quickly adapt to market changes and customer demands.
Scalability: As telcos grow their B2B operations, composable commerce solutions can easily scale to accommodate increased transaction volumes and more sophisticated business processes.
Customization: With composable commerce, telcos can create personalized experiences for different B2B customers, addressing unique needs and preferences, which is crucial for maintaining competitive advantage in the B2B space.
Faster time to market: By leveraging pre-built components, telcos can reduce development time and quickly launch new products and services, staying ahead of competitors.
Cost efficiency: Composable commerce allows telcos to pay for only the components they need, optimizing costs and avoiding the expense of maintaining monolithic systems.
Integration capabilities: It facilitates seamless integration with existing systems, including CRM, ERP, CPQ and other business tools, ensuring smooth operations and data consistency across platforms.
commercetools for Telecom
With 14 telco and media customers, commercetools has proven itself to be an invaluable ally to the telecommunications industry. The component-based, cloud-native, tech-agnostic design of our solution fully aligns with the ODA framework created by TM Forum to accelerate the industry’s move away from monolithic, legacy IT stacks towards more agile, horizontal, plug-and-play environments.
By migrating to commercetools in conjunction with adopting the ODA framework, telcos can easily execute the strategies necessary to capitalize on the current B2B opportunity as well as expand into additional markets that will drive growth and reinforce their competitive edge.
To gain a full understanding of why telcos need to expand their offerings and how commercetools can help, download our white paper, Turning Challenges into Opportunities: How Composable Technology Will Save the Telecom Industry.
Anita J. Temple is the Corporate Journalist at commercetools. She was a fashion editor at Women’s Wear Daily (WWD) and W Magazine before launching a career as a freelance writer and creative producer. She has written content and worked on a wide range of marketing projects for companies including Dreamworks, Walmart, Coca-Cola, Verizon, and Adidas.