AMI-Partners: Behavioral Segmentation Key to Unlocking Value in US SMB Telecommunications and Managed Services Markets.

AMI's Recent Go-To-Market Study Identifies Unique Needs and Behaviors-Based Segments in the US SMB Space

NEW YORK -- AMI's segmentation of the US SMB telecommunications market reveals the presence of 4 unique segments, of which 2 key segments are driving the bulk of adoption and spending on emerging high-growth areas, including hosted VoIP, premises-based IP-PBX and managed services (security, storage, network support, etc.). These leading segments are also transforming the SMB landscape by rapidly implementing various elements of a Unified Communications (UC) portfolio, such as web conferencing, Instant Messaging (IM) and soft phones, among others. While comprising only 25-40% of all SMBs nationwide, these two segments drive 70-80% of spending on emerging communications solutions. The other two segments, while 60-75% of all SMBs, drive no more than 20-30% of spending on such solutions.

The report, titled "U.S. SMB Telecom/IP Communications and Managed Services Segmentation Report", is based on a unique IT/telecommunications-centric needs and behavioral segmentation of over 1,500 US SMBs. SBs are defined as firms with 1-99 employees and MBs as firms with 100-999 employees. The 4 segments include:

* Enterprise Adopters (Tier 1 SMBs): Solutions buyers, willing to pay premiums for scalability, QoS and SLAs

* Cutting Edge Adopters (Tier 2 SMBs): Desire latest products and solutions, but not at premium prices

* Value Adopters (Tier 3 SMBs): Price-point buyers, acquire mature technologies and point products

* Needs Help Adopters (Tier 4 SMBs): Uncomfortable with technology, buy simple, basic communications products

"As communications service providers strive to grow average revenues per customer by adding IP-based services to their portfolio, it becomes imperative to understand the target segments and the customer-engagement model for driving that additional value," says Deepinder Sahni, New York-based analyst at AMI-Partners. "Each segment has a distinct set of needs, mindsets and behaviors that guide its acquisition of communications solutions. Further, each segment is impacted uniquely by its surrounding competitive, economic and regulatory environment," says Mr. Sahni.

The segmentation has practical implications ranging from market planning and strategy to organizational structure for optimizing the go-to-market (GTM) approach that service providers have in the SMB market.

Select highlights from the report suggest:

* 1 in 5 Tier 1 SBs, and 2 out of 5 Tier 1 MBs, are now using web conferencing.

* 13% of Tier 1 SBs have deployed soft phones, in contrast to only 3% of Tier 4 SBs.

* Over 1 in 5 MBs are using videoconferencing relative to 1 in 10 among Tier 4 MBs.

* Over 70% of the total SMB spending on managed services is driven by Tier 1 and Tier 2 SMBs.

* A typical Tier 1 MB spends about 3.8X the amount a Tier 4 MB spends on telecommunications each year.

* A Tier 2 SB spends about 2X the amount a Tier 3 SBs spends on telecommunications each year.

About the Study

Based on AMI's nationally representative survey of over 1,500 US SMBs, the "U.S. SMB Telecom/IP Communications and Managed Services Segmentation Report" provides an actionable segmentation framework which can be deployed by vendors and service providers to shape their go-to-market strategy. Each segment is profiled in terms of 250+ questions related to firmographic, attitudinal, channel preference and technology usage/plans, and allows for developing an unprecedented level of insight around SMB communications needs, technology environments, buying preferences and decision-making styles.

As a separate service, AMI-Partners also provides predictive models that vendors and service providers may use to classify their customer/prospect marketing databases into each of these 4 tiers/segments. This classification serves as a starting point for implementing various sales and marketing activities in conjunction with overall segmentation strategy.

For more information about this study, AMI-Partners, or our global SMB research, please call 212-944-5100, e-mail [e-mail], or visit the AMI Web site at www.ami-partners.com. If you would like to arrange a webcast that will include a backgrounder on AMI's SMB Telecom/IP Communications and Managed Services research practice and highlights from the new study, contact Julia Blelock at [e-mail].

About AMI-Partners and the SMB Telecom/IP Communications and Managed IT Infrastructure Service

AMI-Partners specializes in IT, Internet, telecommunications and business services strategy, venture capital, and actionable market intelligence--focusing on global small and medium business (SMB) enterprises. AMI has helped shape the go-to-market SMB strategies of more than 150 leading IT and communications companies over the last ten years. The firm is well known for its IT/communications adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys in more than 25 countries; and its proprietary database of SMBs and SMB channel partners in the Americas, Europe and Asia-Pacific. The firm invests significantly in collecting survey-based information from several thousand SMBs annually, and is considered the premier source for global SMB trends and analysis.

AMI's Telecom/IP Communications and Managed IT Infrastructure practice is a powerful and actionable blend of in-depth SMB demand tracking/analysis, supply-side and channel partner assessments, and go-to-market segmentation strategy and predictive analytics. It equips vendors with the tools needed to successfully navigate the challenges and requirements of the dynamic SMB marketplace.