Creating the Perfect Recipe for Digital Services

Let me be honest: the idea of using a cooking analogy for creating a winning recipe of digital ingredients is not mine. As a model Italian, I love cooking and sometimes I find myself watching some culinary series with chef stars like Gordon Ramsey or Alessandro Borghese.

Some months ago, TIM (Telecom Italia) hired Alessandro Borghese to simulate a recipe made of digital services. The result? After a little bit of Microsoft 365, a little bit of Acronis and a little bit of connectivity the dish was ready.

Watching the program, I thought, “True! A winning dish for telcos is made by ingredients (digital services), cooking techniques (bundling and solution building) and presentation (marketplaces and sales techniques).”

Let’s explore a few common scenarios in the real world.

Scenario 1: Moving from one core asset to many products

Let’s explore another analogy: farming and digital services businesses. Let’s say you’re a farmer and have always sold apples. Hence, apples are your core asset. You’ve based your reputation on one quality product, but as new players have entered the market, revenue and margin have fallen. You need something more to keep your business going strong, so you decide to add more variety in your offering. What will be your next ingredient?

You decide to sell more types of fruit from third parties so your customers will have a large selection to choose from in your store. However, have you asked yourself before making this decision about the added value you would bring to your customers? Why should your customers buy from you if there are other more competitive market players? Will you be able to give customers information about the fruit you do not produce but resell?

Leverage knowledge management for success 

The same scenario experienced by the apple farmer holds true with telcos who decide to offer more digital services besides their core asset of connectivity. Being able to provide your customers with the information they seek requires that you invest rather heavily in knowledge management.

Knowledge management is essential for the success of your business and its importance increases as your portfolio of third-party solutions grows. Why? Variety increases volume, which increases the need for knowledge management. When you offer many services, you need to find a way to be able to provide enough information—and therefore as much value—as your customer requires.

If you’d like to consider another plan, let’s look at scenario 2.

Scenario 2: Focusing on a few high-quality products   

Adding products alone does not lead to creating a winning telco business. When creating your recipe for success, you need to consider which products you select, how you put them together and which marketplace you will use. In this scenario, you’ll make a boutique offering of only a few of the highest quality products. As a result, you can increase the price and set the margin higher.

In this case, rather than going all-in on volume, you can invest time, resources and energy in being a guru of the few products you sell. However, there are also complexities in this model to consider. For example, how do you choose the right products? What criteria do you use? You will need to rely on market experts and product experts and target a precise, digitally mature customer segment that is inclined to spend a little more for quality and support. This plan works well if your customer base is ready.

Looking for yet another option? Let’s consider scenario 3, which we will cover in detail in a subsequent blog.

Scenario 3: Ecosystem of local partners

In this scenario, you’ll create an ecosystem of local partners. Local partners are more flexible, provide the knowledge required, offer high margin, show flexibility and lead the product’s evolution, following the needs of the markets.

Turning to CloudBlue for expert guidance    

All of these plans are valid, but it can be confusing to select the right scenario and digital services for your business. The real value in a complex ecosystem is in partner orchestration within a clear idea of business solution—and that’s just one area where CloudBlue can help.

For support and to learn more about how to power what’s next for your business, read about CloudBlue, a catalog and channel management platform that supports omni-product distribution.

For more information and for any questions, please contact us at together@cloudblue.com.