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The Opportunity for National Brands in SMB Technical Support Services A Parks Associates white paper developed for PlumChoice

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Page 1: The Opportunity for National Brands in SMB Technical ... Assoc... · The Opportunity for National Brands in SMB Technical Support Services A Parks Associates white paper developed

The Opportunity for National Brands in SMB Technical Support Services

A Parks Associates white paper developed for PlumChoice

Page 2: The Opportunity for National Brands in SMB Technical ... Assoc... · The Opportunity for National Brands in SMB Technical Support Services A Parks Associates white paper developed

2

Understanding the Small and Medium-sized Business Market

Sizing the Market and Technology in the SMB Environment

According to the U.S. Census Bureau and Parks Associates’ estimates, there are roughly 5.7 million U.S. businesses with 1-99

employees. Since 1998, the number of SMBs has grown, on average, 1-2% per year. Together, these firms have an annual

payroll of over $1.3 trillion.

The average SMB uses nearly ten computers, split between desktops and laptops. After adding in netbooks and tablets,

the average number of computer “workstations” per business is around 11, with roughly three printers per business.

Technology in the SMB Environment(Average Number of Products in Use, Millions)

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

8

4

0Desktop

ComputersMobile Phone

Handsets

Laptop Computers

Printers Scanners Fax Machines

Netbook Computers

Projectors Tablets

Current and Future Expenditures

Although current expenditures for ongoing and per-incident technical support are a relatively low portion of spending for IT

equipment and services, indications are positive for increased spending on technical support services. The size of the small

or medium business in terms of employees is today a chief indicator of the willingness to increase investment in support

services. As the technology environment continues to increase and diversify across different sizes of businesses, frustrations

with technology complexity and business owners’ desire to prioritize business activities—as opposed to technology

management—will drive an increase in outsourced technology support services.

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IT Spending

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

30%

15%

0%

Perc

enta

ge o

f U.S

. SM

Bs (%

)

IT support sta� Warranties/service plans Ongoing support Per-incident support

Increases in Tech Support Spending, Future Intentions

All SMBs

1-10 employees

11-20 employees

21-50 employees

51-99 employees

Average Annual Amount Spenton IT Equipment and Services

(Average Expenditure, in U.S. dollars)

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

$1,600

$800

$0Communication

servicesIT equipment Software Mobile/wireless

phone issuesOngoing support

contracts from outside IT �rms

Warranties/service plans

Per-incidentsupport from

outside IT �rms

Mea

n A

mou

nt S

pent

($)

The average number of computer “workstations” per SMB is around 11

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The Technical Support Landscape

There was no single third-

party brand that could inte-

grate technical support, data

services, and communications

at a nationwide level until

AT&T launched its Tech

Support 360 service in 2008.

This offering has changed the

landscape of SMB technical

support services as it is na-

tional in its reach, it offers a full

suite of support services, and

it is not limited to supporting

only certain IT brands.

Another key factor in AT&T’s

nationwide rollout is the

robust service offerings that

it can bring to the SMB environment. Tech Support 360

goes beyond a computer “break/fix” service to include

comprehensive SMB tech support services. These include

both proactive and as-needed support, provided both

remotely and on-site. AT&T recently added Server Support

into its mix of offerings, which monitors servers, applications,

the office network, and Internet connectivity, plus areas

such as firewalls, switches, and routers.

Remote diagnostics, monitoring, and troubleshooting ca-

pabilities are critical components in delivering SMB support.

The most-critical need for SMB IT managers is to resolve

technology problems as quickly as possible. Remote ser-

vices provide this speed and effectiveness, allowing tech

support personnel to quickly connect to, diagnose, trou-

bleshoot, and resolve the majority of problems without the

need for the SMB to wait for a technician to arrive on-site.

Two key trends are emerging from SMB support offerings:

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

Server problems

Internet access problems

Setting up/troubleshooting company mobile phones

Networking problems

Routine maintenance

Training for newsoftware & hardware

Computer malfunctions

Setting up PCs, email,etc. for new users

Problems with peripherals

Setup of new PCs, software, hardware or peripherals

Percentage Indicating Remote as Preferred (%)

For What Services do SMBs Prefer Remote Tech Support?(Among SMBs)

0% 20% 40%

1. Greater flexibility in how SMBs use e-mail, applications, database, and servers (for example, setting up physical servers on-site or allowing the support provider to host them in an off-site environment)

2. Backup moving from per-desktop or per-server file recovery to a more comprehensive offering that can include real-time virtualization and restoration in the event of a disaster (such as a server crash or a natural disaster)

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Tech Support Needs

Significant percentages of SMBs have used professional

technical support services for a variety of issues, notably

for problems related to servers, networking, and

computers. SMBs are most likely to consider support for

these three areas, but they also are interested in support

for additional products including peripherals and mobile

phones. In addition to demand for as-needed support

for both products and services, there is also interest in

ongoing care such as routine computer maintenance and

non-troubleshooting services such as training for software

and hardware.

Among SMBs that have used professional technical

support services previously, they are highly satisfied with

the courtesy and professionalism of the tech support

agent(s) who provided the assistance. Where SMB technical

support services can improve are areas such as the initial

response time, complete resolution of the problem, and

the time it took to resolve the issue. Leveraging remote

access solutions will allow SMB support providers to raise

customer satisfaction with faster response times and

more convenience to the business, which will not have to

wait for a technician to arrive on-site or have to ship its IT

equipment to a depot or repair center.

The use of and interest in professional support services correlate to the current technology challenges facing SMBs

today. These businesses are more likely to face problems with Internet access, peripherals, and computer malfunctions.

Interestingly, although the percentage of SMBs experiencing problems with mobile phones is relatively small, IT managers

report significant hours of lost time per month because of these issues. As smartphone and tablet use continues to grow

in the SMB environment, a technical support provider will need the expertise and capabilities—including remote access to

handsets—to respond appropriately to these challenges.

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

SMBs and Professional Tech Support

Have Used Tech Support

Likely to Use Tech Support40%

20%

0%

Perc

enta

ge o

f U.S

. SM

Bs (%

)

Server problems

Networking problems

Computer malfunctions

Internet access problems

Set up PCs/e-mail for new users

Problems with peripherals

Software/hardware training

Mobile phone issues

Routine computer maintenance

Leveraging remote access solutions will allow SMB support providers to raise customer satisfaction

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Tech Support Needs

Between the time spent on the part of the

IT manager resolving these issues and the

amount of lost productivity experienced

by employees, there are dozens of hours

per month at stake in addressing technical

issues. An important marketing message

from support providers to the SMB

community should be in promoting how

professional care can assist businesses in

recapturing time for building a business

and serving customers.

The notion of recurring care strongly reso-

nates among SMBs. The value of ongoing

care, preventative maintenance, and opti-

mization of systems—not to mention as-

needed technology consulting services—

will grow as SMB technology decision-

makers recognize the need for proactive

care. These types of services also become

more attractive when they are bundled

with existing services that an SMB uses al-

ready. AT&T’s Tech Support 360 is a good

example of a program that can be tied

with communications and data services.

The market opportunity for technical sup-

port subscriptions is significant as 85% of

SMBs do not currently have an ongoing

tech support relationship.

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

80%

40%

0%

10

6

0

Hou

rs o

f los

t pro

duct

ivity

, per

mon

th (#

)

Percentage of U.S. SM

Bs (%)

Routine computer maintenance

Internet access problems

Problems with peripherals

Computer malfunctions

Networking problems

Set up PCs/e-mail for new users

Server problems

Set up new software/hardware/peripherals

Software/hardware training

Mobile phone issues

Frequency of IT Problems and Lost Productivity(Among SMBs)

Hours of lost productivity

Percentage of SMBs

U.S. SMBs with Current Professional Tech Support Service

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

80%

40%

0%

All SMBs 1 - 10employees

11 - 20employees

21 - 50employees

51 - 99employees

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The Connected TV and Video Experience: Recommendations, Search, and the User Interface | © 2010 Parks Associates

Marketing and Promoting Technology Support Services

Companies seeking to establish a foothold in IT support services for SMBs need to offer support across a wide range of

products and services—servers to smartphones, workstations to tablets. Second, they must offer these support services in a

way that is timely and convenient to their customers. Therefore, remote technology support services are critical in allowing

technology support companies to be more responsive and comprehensive in their offerings, from timely response times

to offering proactive care such as computer tune-ups.

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

The speed with whichproblems are resolved

The ability tounderstand technicians

Ability to have a technician on-site within a day

Ability to have a technician access my equipment remotely

Ability to proactivelyprevent IT problems

Company is one we already use for equipment/other services

The price of the service

Ability to o�er o�site/hosted storage

Multiple options forsubmitting a work order

Ability to keep service on retainer and pay them as needed

Flexible payment terms

Importance of Technology Support Service Characteristics(Among SMBs)

0% 40% 80%

The ability by a service to offer remote support rates high among SMB IT decision-makers, as is the ability of a company to

offer communications or data services along with the support services. The ability by a company such as AT&T or another

broadband/communications provider to bundle support with core offerings is an important selling point for a carrier in

this business, making it highly likely that additional service providers will enter the SMB support space.

Providing timely and comprehensive support is the highest-valued characteristic of a support provider

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Influences

Source: SMB Demand for Technical Support Services© 2011 Parks Associates

Recommendations from other businesses of similar size

Recommendations from service providers with whom we

currently work

Recommendations from outside, IT consultants

Recommendations from warranty support companies with whom

we work

Recommendations from friends or family members

Recommendations from company employees

Recommendations from equipment manufacturers with

whom we work

Tech support forums/crowd-sourcing

Recommendations made from professional networking sites

In�uences for purchasing technology support services(Among SMBs)

0% 25% 50%

SMBs cite recommendations from peers and their existing

service providers as the chief influencers for choosing a

technology support service. To educate the SMB commu-

nity about the benefits of using professional outsourced

technical support services, providers should promote the

work that they are already doing in this space and use

current customers as case studies. Important informa-

tion to disseminate includes cost comparisons between

external support services vs. full- or part-time internal hires

(or no support at all), discussions from current customers

about time savings in using external resources, and in-

formation that targets a critical SMB need—does using

outside professional support services allow SMBs to focus

on what really matters: acquiring and serving customers?

In addition to using resources such as peers, service

providers, professional networking websites, and

local entities aimed at supporting the small-business

community (chambers of commerce, etc.), support

providers need to build packages of support services that

are easy to understand. Clear information about what a

support subscription includes in terms of the types and

numbers of IT equipment serviced, processes in deliver-

ing services, and pricing options is important for SMBs

when judging the value and affordability of different

plans. If price breaks are offered for bundling support with

the purchase of IT equipment or with a subscription to

specific communications or data services, these benefits

need to be clearly explained.

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U.S. market revenues for SMB technical support services will grow from $9.6 billion in 2011 to $20.1 billion in 2015.

The Market Opportunity

SMB Tech Support Services, Annual Revenue(U.S. Revenues, in Millions)

Source: Opportunities for SMB Support Services© 2011 Parks Associates

$25,000

$0

2010 2011 2012 2013 2014 2015

Mill

ions

of D

olla

rs S

pent

($M

)

Backup

Computer Set-up

Server Support

Support Subscriptions

Desktop Support

The individual software, hardware, and services that constitute SMB support

services are extremely broad and can encompass data and website hosting,

server maintenance, communications systems, service level agreements

(SLAs), and networking support. Because Parks Associates’ research focuses

on computer systems and subscription services, forecasts include the

following areas:

• Computerset-upservices;

• Computertroubleshooting;

• Technicalsupportserviceplans;

• Serversupport;and

• Backup.

Projections for market revenues begin with the current use of and interest in

these services, all obtained from the Parks Associates survey SMB Demand for

Technical Support Services. These figures are then applied to projections for the

growth of small businesses, computer sales, and server usage.

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Key Takeaways

SMB IT decision-makers will rely on their peers and

information such as case studies to make decisions

about implementing outsourced technical support.

Companies servicing the SMB market need to have

marketing material that emphasizes success stories and

explains in clear language the time and cost benefits of

outsourcing technical support. Within the cost estimates

should be explanations of both time and cost benefits

to using external support entities—including faster

deployment of services and lower development costs.

Data backup/hosting is an opportunity. Today, fewer

than 20% of U.S. SMBs use hosted storage. However,

marketing hosted storage for convenience (mobile access,

collaboration, etc.) and disaster preparedness will make

this service more enticing to businesses.

Emphasizenetworkandserver support services. SMBs

looking for professional support will likely be wrestling

with a plethora of server and network issues. Service

providers should cater to this core need and use marketing

and sales material to emphasize their networking and

server strengths.

ITsupport includesmorethanserversandcomputers.

A successful IT support offering will address care to not

only fixed equipment such as computers and servers but

mobile devices as well. As indicated by Parks Associates’

survey, SMB IT managers find that mobile phone trouble-

shooting is a significant drain on their time and employee

productivity. As growing numbers of SMBs incorporate

smartphones and tablets into their IT environment, they

will expect technical support for these devices.

Work with internal IT managers, not against them.An

outside provider positioning itself as a comprehensive IT

support solution may generate resistance from internal IT

managers concerned about loss of influence or even job se-

curity. Offering services that enhance and facilitate (rather

than replace) their jobs is a smart marketing approach.

Comprehensive care services will be critical. Many

SMBs are seeking technical support service offerings that

go beyond one-off computer “break/fix” services; they

are interested in comprehensive offerings for server and

mobile device support, hosted storage, and peripheral

support. Companies addressing this market will need to

put together holistic care services and offer flexible pric-

ing that takes into account the budget limitations and

unique requirements of smaller firms in addition to sub-

scription-based pricing that includes unlimited remote

and on-site support.

As more SMBs use smartphones and tablets, they will expect technical support for these mobile devices.

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The Connected TV and Video Experience: Recommendations, Search, and the User Interface | © 2010 Parks Associates

Attribution: Authored by Kurt Scherf, Vice President & Principal Analyst, Parks Associates Published by Parks Associates © 2011 Parks Associates

Dallas, Texas

All rights reserved. No part of this book may be reproduced, in any form or by any means, without permission in

writing from the publisher. Printed in the United States of America.

Disclaimer: Parks Associates and PlumChoice have made every reasonable effort to ensure that all information in this report is correct. We assume no responsibility for any inadvertent errors.

WP09-092011-2

ABOUT PLUMCHOICE

PlumChoice is setting a new standard of customer care with its Service

2.0 approach that has reinvented the way technology care is provided to

connected homes and small businesses. As the largest independent technology care provider in the industry, PlumChoice

pioneered the remote technical services business in 2001, providing 24x7 online repair and assistance for digital devices

through local industry-certified agents. With the addition of its patented SAFElink™ service relationship platform, PlumChoice

now offers a fully integrated and highly secure solution for service providers and other business partners, working under

their brand names to provide them with new sources of revenue and cost reduction.

PlumChoice’s services can be delivered remotely or on-site as a one-time incident, bundled with products/services, or

subscriber-based solution. Covered devices include PCs and Macintosh® computers, laptops, and mobile phones, TVs and

home theater systems, routers and servers, networks, security systems, consumer electronics, software, peripherals, iPhones®

and other devices.

www.plumchoice.com | 1.866.811.3321 | [email protected]

ABOUT PARKS ASSOCIATES

Parks Associates is an internationally recognized market research and consulting company

specializing in emerging consumer technology products and services. Founded in 1986, Parks

Associates creates research capital for companies ranging from Fortune 500 to small start-ups through market reports,

primary studies, consumer research, custom research, workshops, executive conferences, and annual service subscriptions.

The company’s expertise includes new media, digital entertainment and gaming, home networks, Internet and television

services, digital health, mobile applications and services, consumer electronics, energy management, and home control

systems and security.

www.parksassociates.com | 972.490.1113 | [email protected]

This white paper was commissioned by PlumChoice. Research results came from SMB Demand for Technical Support Services, a U.S. survey fielded in December 2010 of several hundred owners, managers, and IT support decision makers from small and medium businesses across a number of industries. For further information on this study or help to bring your National SMB Tech Support brand to market, contact PlumChoice at 1.866.811.3321 or [email protected].

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