There’s a well-established maxim in the sales of information and
communications technology (ICT) products and services: Don’t sell bits and
bytes, feeds and speeds. Instead, sell features and benefits. There’s a good
reason for this selling principle. Most consumers aren’t interested in technology.
They’re interested in what it can do to benefit them and its value for the
money invested.
The
same rule applies in telecommunications. But it has been violated in the marketing
of fiber to the premise (FTTP) services, where Internet Service Providers have
defined FTTP by its speed – its ability to deliver bandwidths of 1 gigabit or
more. Problem is, only a small percentage of consumers really know what the
term “gigabit” means, according to a survey by Pivot Group spotlighted in the January/February
issue of
Broadband Communities
magazine. (
Sell Services, Not Speed)
“Service providers spend an awful lot of time and marketing spend emphasizing speed, but this research reveals consumers are confused regarding speed references and perceive that their current speed package is sufficient,” Dave Nieuwstraten, president of Pivot Group and co-author of the study, observes.
The takeaway: What really matters isn’t gigabit bandwidth per se but rather
the services FTTP can enable in the home where people have high definition televisions,
desktop and laptop computers and personal devices such as tablets and
smartphones all being supported by the home’s Internet connection. FTTP will
play an increasingly important role in the delivery of video content as more is
delivered via the Internet, enhancing its value to consumers sensitive to high
price points for Internet service used to support only web browsing and email. That
will increasingly be so as live sports migrates to Internet streaming.
In the era of FTTP, it’s really no longer useful to market bandwidth or
brand it with a speed-based term such as "gigabit” or “broadband” -- a now obsolete term used in the
1990s to distinguish narrowband dialup Internet access from first generation ADSL
services. Similarly, marketing Internet services with speed/bandwidth price tiers is no longer truly relevant for premise services. Without benefits described, consumers will naturally tend toward lower cost options.
Emphasizing the utility and benefits of a FTTP connection also fits well
with the open access, wholesale model where the owner of the FTTP
infrastructure sells access to ISPs who in turn sell retail services delivered
over it. Including new ones mentioned in the
Broadband Communities article such as installing and supporting the
next generation of more robust home Wi-Fi needed to enable all of those
wireless devices being used in today’s homes and home-based businesses.