Report: U.S. Wireless Carriers Should Follow Europe's Lead, Focus on SMBs

U.S. wireless companies reportedly can learn a lot from Europe’s experience with small companies.

 

While in the United States, medium and large businesses employ 70 percent of employees – European large enterprises employ only 30 percent, with the other 70 percent in small businesses, according to Glass House Italia, a consultancy with U.S. offices in Portland, Oregon.

 

So European mobile companies make small business clients a top priority, Glass House officials say in a new report, titled “What can American wireless companies learn from European’s about small business?”

 

While U.S. carriers put their energies and investments toward reaching large customers, European carriers emphasize mass marketing strategies for reaching small business. North American carriers and providers can learn a lot from Europe as they struggle to win a base of small business subscribers who remain uncommitted to an American cell phone brand.

 

The lack of focus from U.S. wireless companies on small businesses boils down to prioritization between immediate financial return, and long-term growth. Small business requires a new sales model, and new services for which most U.S. wireless companies address small business with brochures and advertising which are not very different from large business or consumer offerings.

 

Consistently between 1993 and 2004, the U.S. business composition has evolved so that employment is shifting from larger to smaller. In 2004, firms with less than 500 employees accounted for all net new jobs in the United States (1.86 million), while firms with 500 or more had a net loss, government officials say.

 

Therefore, today, Europe has extremely evolved and effective mass marketing engines to reach small and micro business firms that North Americans can learn as they struggle to win this still largely untapped segment who are as of yet uncommitted to an American cell phone brand.

 

Lynn Castlevetro, chief executive officer and principal at GlassHouse Global, says that with 70 percent of workers employed by small business, European wireless companies had no choice left but to focus on them. Castlevetro added that over many years, Europeans have studied the small business: business drivers, operations, services they need, how they buy, and how to support them and now they understand small business in great detail – for example, the differences across industries such as construction or healthcare.