The Secrets of Selling SIP Trunking

(SP-06)Room 304-C

Joel Maloff, Maloff NetResults

joel@maloffnetresults.comwww.maloffnetresults.com

Introduction• Secrets of Selling SIP Trunks

– Designed for the sales team in the field today looking to close business opportunities.

• This presentation contains materials covered in more detail in the online program “SIP Trunking for the Sales and Marketing Professional,” available from The SIP School (www.thesipschool.com).

Secrets of Selling SIP Trunking Overview

• Identifying YOUR SIP Trunking “Sweet Spot” and what to avoid

• Interpreting the customer’s Status Quo– Uncovering areas of added value

• Creating a cost justification/ROI model

• Overcoming Objections• Closing the Sale• Keeping the Sale

The SIP Trunking “Sweet Spot”• Each ITSP is different.

– What is your “sweet spot”

• Number of concurrent calls?

• Number of locations?• Minimum current

telephone bill? • Number of PRIs total

and/or per location?

The SIP Trunking “Sweet Spot”• Number of minutes per

month?– Incoming?– Outgoing?

• Local, domestic long distance, international?

• Inbound Toll-free?• Specific vertical

industries?• Specific geographies?

The SIP Trunking “Sweet Spot”• As a sales team,

knowing who and where to target can be the difference in making your numbers or failing to perform.

Interpreting the Status Quo

• Reviewing an actual customer bill for cost savings

• Identifying areas of “soft” savings

Finding Added Value• Consolidation of

offices• Creation of “Virtual”

presence– Domestic– International

Cost Justification and ROI• It is easy to assert cost

savings; it takes work to prove it.

• “Hard” SIP trunking cost savings come from three primary areas:– Usage sensitive call charges– Fixed price services (PRI,

DSL, et al) used for voice services

Cost Justification and ROI– Fees and Surcharges

• EUCL – The End User Common Line

(EUCL) charge is a federally regulated monthly service charge applied to certain local voice service offerings.

• RCRF – The Regulatory Cost

Recovery Fee (RCRF) – Imposed by some carriers

on business and residential long distance customers

– used to recover costs associated with Federal regulatory fees imposed upon these carriers.

• Others

Cost Justification and ROI• Calculating potential savings

– Understand current costs by examining a current bill if possible.

• Try to make sure that it is a representative month and not an anomaly.

– Identify usage charges and their breakdown regarding local, domestic long distance, and international.

– Identify fixed monthly charges for PRIs, DSL, and surcharges.

Cost Justification and ROI• Some vendors do offer ROI tools for SIP

trunking.– http://www.xo.com/forms/campaign/External

Sales/ESIPCalcLP/index.aspx?ListSource=PressRelease071510

– Unfortunately, the level of detail may not be sufficient for you – unless you are an XO salesperson!

Cost Justification and ROI• What are the challenges with “overview”

ROI tools?– Total Number of employees

• Minimum of 50– Number of Physical Locations

• Minimum of 5– Percentage of Inter-company calling– Asserted savings is 38%!

• What is missing from this picture?

Cost Justification and ROI

Type of Calls: # CallsDuration

in MinutesAverage

Call Duration Current Carrier A Current Carrier B Current Carrier CYOUR

Cost/MinuteCarrier A

TotalCarrier B

TotalCarrier C

TotalYOUR Total

Direct Dial Interstate 68,247 104,953 1.54 0.0201$ 0.0500$ 0.0180$ 0.0140$ 2,110$ 5,248$ 1,889$ 1,469$ Direct Dial Intrastate 1,419 1,693 1.19 0.0840$ 0.0490$ 0.0490$ 0.0140$ 142$ 83$ 83$ 24$ Toll-Free Interstate 2,257 4,731 2.10 0.0201$ 0.0150$ 0.0180$ 0.0140$ 95$ 71$ 85$ 66$ Toll Free Canada (call from Canada) 987 2,381 2.41 0.1950$ 0.0490$ 0.0490$ 0.0180$ 464$ 117$ 117$ 43$

International from U.S.:United Kingdom 3,216 4,900 1.52 0.0300$ 0.0300$ 0.0300$ 0.020$ 147$ 147$ 147$ 98$ Japan 1,068 1,777 1.66 0.1381$ 0.0556$ 0.0400$ 0.045$ 245$ 99$ 71$ 80$ Hong Kong 310 408 1.32 0.2100$ 0.0509$ 0.0600$ 0.040$ 86$ 21$ 24$ 16$ Singapore 210 287 1.37 0.1400$ 0.0675$ 0.0400$ 0.036$ 40$ 19$ 11$ 10$ Brazil 93 138 1.48 0.1380$ 0.0503$ 0.0400$ 0.050$ 19$ 7$ 6$ 7$ Australia 63 96 1.52 0.2190$ 0.1520$ 0.0700$ 0.041$ 21$ 15$ 7$ 4$ Norway 39 39 1.00 0.2190$ 0.1363$ 0.0500$ 0.040$ 9$ 5$ 2$ 2$

USAGE SUMMARY # Calls Durationin Minutes

Average Call Duration

Carrier A Total

Carrier BTotal

Carrier CTotal

YOUR Total

Total Direct Dial Domestic 72,910 113,758 1.56 2,347$ 5,402$ 2,057$ 1,559$ Total International 4,999 7,645 1.53 567$ 313$ 268$ 217$

Total Inbound Toll Free 3,244 7,112 2.19 464$ 117$ 117$ 43$

TOTAL MONTHLY USAGE 81,153 128,515 1.58

MONTHLY COSTS 3,378$ 5,831$ 2,442$ 1,819$

PROJECTED ANNUAL USAGE 973,836 1,542,180 ANNUAL

COSTS 40,536$ 69,972$ 29,306$ 21,830$

SIP Trunking Customer Usage Analysis

Cost Justification and ROI• Calculating potential costs

– Identify fixed monthly charges for PRIs, DSL, and surcharges.

– Calculate the number of SIP trunks (concurrent calls) and Internet bandwidth required using the spreadsheet on the next slide.

• 9600 minutes = 22 working days X 8 hours X 60 minutes• On the average, 17% of calls occur during the “busy

hour.”• Each “concurrent call” requires approximately 80 kbps

using the G.711 codec (50 kbps for G.729).

Cost Justification and ROI

Dedicated Circuits Type Bandwidth Number Number of Voice Channels

Monthly $$ Total Monthly

PRI 1.5 mbps 1 23 450.00$ 450$ T-1 1.5 mbps 1 CODEC Dependant 300.00$ 300$ E-1 2.048 mbps 1 30 -$ DSL 512 kbps 0 -$

SIP Trunks CODECBW per call (kbps)

Concurrent Calls

Total BW Required (kbps)

MRC Per SIP Trunk Total MRC

G.729 50 7 330 20.00$ 132$ G.711 80 7 528 20.00$ 132$

SIP Trunking Customer Fixed Cost Analysis

Cost Justification and ROI• Calculating potential savings and value

– Include all costs for all solutions– Consider surcharges and fees such as EUCL

(Approximately $40 per PRI or T-1 monthly) and RCRF (Approximately 3.5% of all domestic and international calling charges)

• Most ITSPs do not include EUCL and RCRF fees.– Show the monthly total costs, percent saved via

SIP trunking, and the estimated annual savings.

Cost Justification and ROI

Carrier A Carrier B Carrier C YOUR SIP Trunking

450$ 450$ 450$ 300$ N/A N/A N/A 132$

3,378$ 5,831$ 2,442$ 1,819$ 159$ 244$ 126$ -$

TOTAL MONTHLY FEES 3,987$ 6,526$ 3,018$ 2,251$ Percent saved by SIP Trunking 44% 66% 25%ANNUAL SAVINGS VIA SIP TRUNKING 20,826$ 51,292$ 9,203$

Monthly Recurring Line ChargesMonthly Recurring SIP Trunk FeesAverage Monthly Usage ChargesAverage Monthly Surcharges and Fees

Total Cost Comparison

Cost Justification and ROI

Carrier A Carrier B Carrier C $-

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$20,826

$51,292

$9,203

Annual Savings via Our SIP Trunking Solution

Cost Justification and ROI• Simple tools provide simplistic answers;

business is complex today!

• If you want to deliver quality to your prospects, preparation is in order; they will welcome your expertise!

Overcoming Objections• Conceptual

– Internet Telephony is here to stay• AT&T asks the FCC to allow shut-down of their

traditional PSTN services in favor of IP Telephony.• “… VoIP integrated access, SIP trunking, hosted IP-

PBX/IP Centrex and managed IP-PBX services revenue, is set to double over the next five years, to exceed $20 billion by 2015…. Overall, the growth momentum seen in 2009 was sustained in the first half of 2010 as companies continued to shy away from capital investments, opting, instead, for the OPEX model of hosted VoIP services.” (ABI Research, September 2010)

Overcoming Objections• Technical• Financial• Emotional

Frequently Asked Questions• Customer prospects

will likely have questions about SIP trunking in general and your services specifically.

• Creation of an FAQ for inclusion on your web site and in proposals can be a valuable tool.

Closing the Sale• ASK FOR THE

ORDER!!!• Make it easy.• Make it simple.• Make it painless.

Keeping the Sale• Minimize churn!

– Keeping and growing existing customers is more valuable than new sales.

– The salesperson’s job is NOT done when the service agreement is signed.

• Ensure that service is delivered as sold and when promised.

• Maintain regular contact to avoid unexpected churn, expand existing services, obtain referrals, and solicit testimonials.

Conclusions• Successfully selling SIP trunking services

requires a combination of good old fashioned sales skills and knowledge of the SIP trunking environment beyond just surface information and platitudes.

• Customers NEED SIP Trunks – you need to be able to help them make the buying decision from you!

For More Information• Joel Maloff, Maloff NetResults

– 954-263-1306– joel@maloffnetresults.com– www.maloffnetresults.com

• The SIP School– www.thesipschool.com