One of the most common questions I am asked by those getting ready to build a fiber network is “How can we know that we will get enough customers to make this work?”. They are always hoping there is some magic pill that will let them gain a huge market share to assure their success. Over the years of watching clients launch fiber into hundreds of markets I can assure you there are no magic pills. I’ve come to the conclusion that the two biggest hurdles in the business are first, getting the new network financed, and second, selling to customers.
But there are traits of successful fiber overbuilders that can be duplicated.
Pre-sales campaign. Fiber overbuilders need to take advantage of the one-time buzz that happens when you first bring fiber to a neighborhood. Somewhere between 3 and 6 months before network launch you need to blitz neighborhoods to let them know fiber is on the way. Ideally you will touch every potential customer, and this means a personalized sales approach. This means throwing neighborhood events like ice cream socials or cook-outs. It means distributing door-hangers followed by knocking on every door to let customers know that fiber is on the way.
There is a well-understood maxim that any fiber overbuilder can get 30% of a market just by showing up. There are always customers that either are hungry for better broadband or who simply hate the incumbent providers. An aggressive pre-sales campaign will attract these customers by letting them know you are coming. But pre-sales will also attract another 10% or more of the market, meaning an initial penetration on day-one of 40% or even much higher.
It’s easy to forget that the easiest thing for any potential customer is to do is nothing. If your sales approach is passive – mailers and newspaper ads, you won’t overcome customer inertia that will make it easy for many potential customers to do nothing and to keep the ISP they are already using.
Knowledge Sells. The most successful fiber overbuilders send out knowledgeable salespeople to knock on doors and talk to potential customers. The key word there is knowledgeable. I’ve seen numerous companies hire temporary salespeople, give them a few hours of training and then wonder why they aren’t selling. Successful companies retain permanent salespeople or even send out their own staff to sell door-to-door. When you engage a customer in person it’s essential that the salesperson can comfortably answer all questions about products, prices, the technology and can clearly talk about why a potential customer should switch service.
So don’t take the cheap and easy path of sending out college kids in the summer to sell your network. A knowledgeable sales team will be two or three times more effective at closing sales -so if you are going to make the effort to send out salespeople, send out the right ones.
Persistence. The number one key to long-term success is persistence. Too many fiber builders will blitz a neighborhood one time when it’s first built. They move on to blitz the next new neighborhood and revert to using passive sales techniques in the older market. Such neighborhoods might slowly gain customers over time, though growth often comes as much from word-of-mouth from existing customers as it does from passive sales techniques.
Smart ISPs are persistent. I have clients who knock on doors every year. They have realistic expectation of adding perhaps 2% or 3% per year from a door-knocking campaign in a mature market – but over a decade that translates into a 20% to 30% higher market penetration than they might have had using passive sales techniques. Persistence can pay off for any kind of ISP – I know both commercial and municipal ISPs who have grown to customer penetration rates north of 75% by plugging away at sales year after year.
I know many fiber overbuilders languishing with 40% to 50% penetration rates while having a superior network, better prices and better customer service. They are suffering from what I’ve always called the ‘build-it-and-they-will-come’ mentality and they think their obvious advantages will somehow draw customers to them. What they haven’t done is make the effort to look each potential customer in the eye and explain those advantages. I highly recommend that the general manager and top executives of every ISP take a few days every year to knock on doors. They will quickly learn that a lot of households never heard of their company even though they have had fiber in a neighborhood for years. It’s a humbling experience that quickly demonstrates the value of talking to prospective customers in person.