Sales Friction Creates Barriers to Buying Behavior

Sales friction occurs when a sales process is:

• too long (the line at the grocery store)

• too complicated (working with real estate agents)

• asks for excessive data (a phone number just to get a guest pass)

• doesn’t provide the right info at the right time (no prices)

Not all friction requires sophisticated technology. Firms can curate information, simplifying an otherwise bewildering number of choices. Customers can be offered guarantees, easy cancellation policies, YouTube “how to use” videos or Apple “Genius Bar” support. Frequently asked question support and prompt customer service also can help. 

source: Radial Group

But technology has been routinely used by sales teams for decades. 

Sales-oriented applied artificial intelligence apps are one way we can expect to remove friction from the sales process, updating customer relationship records, allowing sales forces to better keep track of how they are spending their time, integrating calendars to schedule meetings, providing personality profiles for composing emails and messages, automating work flow, analyzing sales effectiveness, automating email communications and sales scripts or recording and analyzing sales conversations. 

source: saleshacker

Less Friction Means Better Business Results

No business is ever completely, 100 percent effective at organizing its resources to attain its business mission. To use an analogy from thermodynamics, achieving any objective means overcoming inertia, which is a form of resistance or friction. 

Sales friction can be understood as anything that prevents a customer from completing a purchase. Friction has a major influence on conversion rates for all business models, business to business or consumer retail. According to Aberdeen, 92 percent of organizations have below-average sales conversion rates simply because of some kind of friction in the customer journey funnel.

source: Business Matters

Friction exists in virtually all parts of any business, because humans are not perfect, systems and processes are not perfect. 

New products do not materialize as if by magic. Teams of developers, designers and manufacturing personnel must cooperate to create each new product, in volume. 

Financing has to be supplied to support all those efforts. Marketing teams must create sales channels, while sales processes must be aligned to move products into the hands of buyers. Support operations must exist to handle after-sale support, training. Logistics teams must store, ship and track products from factory to warehouse to retail channels, handling returns when necessary.

source: Khan Academy

None of that can happen with perfect efficiency and without friction.  Meetings and memos, for example, are necessary to ensure that all activities are synchronized. But such meetings and memos arguably represent inefficiency, time spent on activities other than the actual effort to discover needs, devote people and money to create products to satisfy those needs, price products, manufacture and then support the products, develop sales channels and build awareness among potential buyers of the values of the products. 

When product changes have to be made, causing retooling of the manufacturing process, that is friction. When internal parts of an organization battle with others, that is additional friction.

The promise of all information technology is that friction is reduced. The whole point of machine learning, deep learning and artificial intelligence overall is to discover what customers want, faster and more accurately.

The whole point of internet of things sensors is to monitor processes to prevent bottlenecks, wastage, avoid machine breakdowns or damage. The whole point of customer resource management is to better understand buyer needs and preferences. The value of inventory management is to reduce the cost of building, storing and shipping products to channel partners and customers. 

Call centers, for example, use artificial intelligence to answer customer questions faster, more accurately, with better outcomes, using less customer support time and effort. Retail sensors and inventory systems help retailers keep shelves stocked, and create insight into any potential changes in customer demand. 

In other words, all advanced information technology, from AI to blockchain to identity management and automated cloud computing processes, are designed to reduce business friction. Reduced friction, by intent, lowers cost, raises profits, identifies customer demand more effectively and allows firms to more rapidly move to produce and sell products customers desire. 

When any firm can reduce friction, in any part of its business, it has the potential to achieve better business results.

New Technology is Interesting to Some; Frictionless Business is Interesting to Many

With the caveat that most people conflate any number of related developments with “5G,” and that many see artificial intelligence as a product rather than a capability, the Gartner hype cycle suggests we should soon begin hearing about 5G disappointments and dashed hopes. Gartner believes a period of disillusionment happens with most new technologies, and 5G is about at the peak of such expectations. 

source: Gartner

Hype around various forms of artificial intelligence continues to build and will likely be even harder to comprehend than 5G, as AI represents different ways of using computing to derive insights, but also is not a “product” one buys. 

People can buy 5G service, 5G phones and devices; they cannot purchase “AI” off the shelf as a product they consume and use directly. Instead, AI will enhance the performance of all sorts of devices, software, apps and networks. 

That can make conversations about “AI” quite difficult. A better way to approach matters is to view any number of emerging capabilities and technologies as ways to reduce business friction, allowing firms to understand and target customer needs; improve the quality of their experiences with a product; reduce the cost of creating and providing products; increase sales; boost profit margins and heighten customer delight. 

The more practical the setting, the less likely it is that people, executives or firms will want to spend too much time hearing about AI. But any number of emerging and new technologies have value because they promise to take friction out of any business process.

And friction means cost, waste, delay, customers less happy than they might otherwise be, less precise satisfaction of customer wants and needs.

Big Cities have Best Broadband; Small Towns Tend to Have the Worst:Altman Solon Report

A new report by Altman Solon likely confirms what you would suspect, namely that the largest cities, with the greatest density and population, are least likely to feature municipal-owned networks, as private internet service providers have ample incentive to provide service. Conversely, small communities are the places where the incentives for private operators are lowest, and where municipal efforts are more common. 

source: Altman Solon

In communities with fewer than 1,000 total households, about 11 percent of the communities are “unserved,” defined as places where at least half of homes cannot buy internet access at speeds of 25 Mbps downstream. There are virtually no communities among tier one cities--with at least 100,000 households--where half of homes cannot buy 250 Mbps service.

PTC Academy Now Offers IACET Continuing Education Credit

The PTC Academy offers professional training with an award of recognized continuing education credit to mid-career professionals upgrading their skills in the telecom industry. This year, for the first time, because of the global Covid-19 pandemic, the classroom course is being offered online. Sept. 14 to 30, in the Singapore time zone. 

Participants of this course (it is graded) will receive 1.2 Continuing Education Units administered by Submarine Telecoms Forum, an International Association for Continuing Education and Training (IACET)-accredited continuing education provider. Attendees also receive a PTC Academy Certificate of Completion.

The course features instruction on:

• Business context of the telecom industry: the key changes since the monopoly era gave way to competition; structure of the industry and broader ecosystem, business, and revenue models; key customer trends, value chain roles, and functions; key industry issues including revenue, revenue growth, profit margins, product life cycles, product substitution, regulation, competition, and the impact of the Internet

• How C-level executives can manage or benefit from over the top competition and opportunities

• C-level perspectives on balancing stakeholder welfare (customers, employees, partners, and society)

• Key issues and trends in data center and cloud computing, and how they affect communications

• How C-level executives approach key revenue, competition, cost, and innovation challenges (workshop)

• How mid-level managers can prepare for C-level advancement

• Overview of the data center and cloud computing businesses; customers; products; growth

• The connectivity business in an Internet era

Does Mobile Broadband Cause Economic Growth?

Shockingly, it might be a myth that mobile broadband contributes to economic growth. Perhaps even more shockingly, some argue mobile broadband could, in some instances, actually retard growth. 

Counter to common expectations, the relationship between expanded mobile broadband usage and economic growth is chaotic: it might help, it might have no effect, or it might, shockingly, harm economic growth. Some studies suggest relatively small effects, if we can indeed isolate broadband from all the other forces contributing to economic activity. Yet other studies interpreted as suggesting causation actually only show correlation. 

The reasons for such non-correlation (ignoring for the moment causation) are likely that economic growth is the result of many interacting forces. Broadband alone is hard to isolate. 

“Since broadband is an access technology for data communications, it only has an economic effect in combination with the adoption of information technology, and the implementation of organizational and process changes in enterprises,” the United Nations Broadband Commission has noted. “In other words, for broadband to have an impact on productivity, the ICT ecosystem has to be sufficiently developed.”

In other words, broadband alone does not explain very much, from an agency that believes broadband must be extended to increase economic benefits. 

You might well suppose that mobile broadband, and broadband generally, has the greatest impact where information work is most intensive. Conversely, you might expect clear impact to be least where that is not the case. That is what the U.N. study found. 

“This very surprising conclusion comes from Businessweek having a look at some recent UN numbers on broadband and telecoms more generally around the world,” says Forbes. “We get the highly counterintuitive result that an expansion of mobile broadband coverage leads to a reduction in the rate of economic growth.”

“Focusing on the top 20 leaders in the mobile group, we see there is actually a negative relationship between GDP growth and broadband penetration,” Forbes notes. “It’s not even fair to say that the fastest-growing economies are the fastest growers in broadband.”

That said, most observers instinctively believe more mobile broadband is helpful. Correlation is highest in developed countries; lower in developing countries. 

“Economic benefits to sub-Saharan Africa stemming from Facebook’s connectivity initiatives can exceed USD50 billion over the next five years (2020–2024) in nominal current GDP terms,” say analysts at Analysys Mason. Most of the impact comes from the value and impact of internet traffic on the wide area and local access infrastructure Facebook has put into place. 

source: Analysys Mason

Methodology and assumptions are everything in forecasts. Analysys Mason derives its estimates by applying a rule of thumb used by the International Telecommunications Union. 

“A 2019 study by the ITU used econometric analysis of data from the majority of countries in Africa to determine that a 10 percent increase in mobile broadband penetration (e.g. from 20 percent to 22 percent) in Africa would yield a 2.5 percent increase in GDP per capita in a given year, over and above the baseline growth projected for the country or region,” Analysys Mason says. 

Virtually nobody would disagree that having quality broadband is correlated with some amount of economic growth. The problem is that we have no certain way of knowing the full causal chain. 

Would gross domestic product grow even in the absence of more-ubiquitous broadband? Almost certainly. But does more-ubiquitous broadband access “cause” faster growth, or does faster growth lead to higher demand for broadband? It is a question we cannot answer. 

One must assume the ITU formula of “mobile broadband and mobile broadband adoption” illustrates a causal relationship and not merely an associative relationship. In other words, ubiquitous broadband somehow creates economic growth, rather than economic development driving demand for more broadband.

Though correlation is not causation, it might also be said that, in terms of the relationship between mobile broadband adoption and gross domestic product, the correlation might be positive, neutral or negative. 

That is not what people tend to believe, or want to believe. But neither does evidence necessarily support the notion that mobile broadband causes, or leads to, economic growth.

source: Yankee Group

"There are just too many other factors that affect GDP growth for mobile broadband to have any significant and measurable effect,” said Yankee Group Research VP Declan Lonergan. 

Still, it is fair to say virtually everyone wishes to believe that more-extensive mobile broadband does have a positive impact on economic and social development. We simply cannot say for sure when, and how much, mobile broadband might contribute. 

Most of us believe there is a correlation between widespread broadband access and economic growth or wealth. But there also is a clear correlation between education, income and age and supply or use of broadband and the internet. It’s hard to distinguish between chickens and eggs, in terms of “which came first?”

How Much Demand Remains, in U.S., for Low-Cost Broadband?

Comcast, the U.S. cable TV and internet company, has had significant success offering its own low-cost broadband service to low-income households, signing up about eight million customers for a 15-Mbps service costing $10 a month. Most other major internet service providers offer something similar, though it seems few have been as successful as Comcast. 

source: Axios

While government subsidy programs will continue, and can be important, one wonders how much demand exists for customers who would buy, but believe the cost is too high. Most customers who value fixed network internet access likely already buy.