When contemplating future business growth, Communication Platform as a Service (CPaaS) vendors cannot simply rely on previous communication solutions and expect a significant increase in financial margins, reliable security, and customer satisfaction.
Initial generation 1 technology in the CPaaS space, such as SMS and voice calls, allowed vendors to achieve early growth and success. However, there is now rising evidence that businesses that have invested in both generation 1 and generation 2 solutions and capabilities are seeing higher growth than their competitors.
It’s not enough to have a CPaaS service anymore; companies now need to look toward the future to attract customers and achieve higher growth.
Gen 1 Tech and a Decline in Revenue
According to research from Gartner®, “Communications platform as a service (CPaaS) market growth dropped to 25% in 2H22 as the market matured, offerings commoditized and the economy flattened. Growth of these first-generation foundational services is expected to further decelerate to 15% in 2023-2024.”
What are Gen 1 technologies? These early services allowed CPaaS vendors to reach customers quickly and securely, including SMS/MMS, 2-factor authentication, data anonymization, and voice calling/SIP trunks.
Although these technologies and services allowed an explosion of early growth for CPaaS vendors, customers are more wary of communication than they used to be. Customers are now looking to interact with businesses that consider both the customers’ communication preferences and their security needs.
Gen 1 + Gen 2: A Winning Formula for Higher Growth
From 2014 – 2021, CPaaS vendors using Gen 1 technology saw steady growth in the 30% range for annual revenue. But in recent years, that growth has leveled out.
However, according to Gartner, “CPaaS product leaders seeking to increase annual revenue growth back to the 30% range must sell a newer set of capabilities and solutions that extend communications to align with rich use cases.”
Gen 2 services expand upon the capabilities offered by the voice and messaging channels. These services make it easier for customers to communicate in the manner of their choosing with a business.
Gen 2 CPaaS services can be divided into two categories: Solutions and Capabilities, with capabilities further divided into the subcategories Security, Channels, and E-Commerce Components.
Gen 2 Solutions
- Campaign Manager
- Contact Center
- Commerce Solution
Gen 2 Capabilities
- Voice Biometrics
- Call Risk Scoring
- Branded Calling
- Mobile Verification
- E-Commerce Capabilities
- Digital Signature
CPaaS vendors should utilize some or all of these services to succeed in the fast-growing and ever-changing CPaaS space.
But if there’s a single solution that we recommend integrating first, it’s branded calling.
What is Branded Calling?
Branded calling is a simple solution to a widespread problem – people aren’t answering their phones because they don’t know, or trust, who’s calling them.
A branded calling solution tackles the issue of unknown callers head-on. It allows outbound calls to be branded with a business’s name, branding, department, and reason for the call.
At First Orion, we call our branded calling solution Branded Communication, which includes our INFORM® and ENGAGE® products.
INFORM is a carrier-side integration, meaning the setup is quick and straightforward, with no complicated coding necessary. With INFORM, businesses can brand their calls with up to 32 characters of custom text. Your business can be set up and branding your calls within minutes of activation.
INFORM works on every major U.S. carrier, so your calls will show up with your branding, no matter which carrier your clients use.
ENGAGE works through a mobile app SDK, requiring a little more setup than INFORM. However, ENGAGE takes your branding to the next level with a beautiful full-screen branded call, putting the branding front and center on every phone call.
Higher Growth with Branded Calling
Branded calling can potentially reciprocate a 498% ROI over three years, according to a Forrester Total Economic Impact Report commissioned by First Orion.
Many contact centers need help getting consumers to respond to calls. Whether customers are blocking the numbers or centers are getting marked as spam is difficult to pin down, but one thing is clear – unbranded calls go unanswered. Over time, that low answer rate can translate to lower revenue and your agents wasting valuable time.
However, with a branded phone call, businesses report fewer blocked calls, less time spent troubleshooting, and increased revenue.
Some call centers even report saving nearly half a million dollars in agent time due to a higher answer rate on the first attempt.
All of that saved agent time and money, and increased ROI leads to higher growth for CPaaS vendors than those still focused on Gen 1 solutions.
More Secure Calls Through Branding
According to Gartner, Security or fraud protection is largely a recession-proof industry as highlighted in multiple Gartner surveys and forecasts.
That is simply because customers only answer phone calls if they know whom the call is coming from. Bad actors, including scammers and number spoofers, have made it increasingly difficult for consumers to discern the safety and security of an incoming phone call.
As per Gartner, “Consumers refuse to answer phone calls unless they know who is calling. Businesses in B2C engagement cite the frustration in being unable to connect with customers. With branded calling, the calling party’s logo, URL and phone number are displayed on the called party’s mobile device, who will then answer the call from a trusted source.”
Branded Calling is for Everyone
Branded calling is perfect for CPaaS vendors, but that isn’t the only industry we work for.
Any business that makes outbound calls and has difficulty getting customers to answer will benefit from INFORM branded calling.
If your CPaaS organization is ready to step into the next generation of calling services, talk to one of our salespeople, and they’ll get you started.
Gartner, CPaaS Vendors Must Execute on Higher-Value CPaaS Solutions to Achieve Financial Margins, By Daniel O’Connell, Ajit Patankar, Published 23 May 2023
GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used herein with permission. All rights reserved.