Selling to telcos in Europe is becoming increasingly challenging given the current European telecommunications landscape: With telecommunications being a prominent sector in Europe, accounting for €56.3 billion of capital expenditure in 2021, there is significant potential to improve connectivity and to cater to the demand for advanced services. However, despite substantial investment, the European telecom market faces challenges due to certain weak and outdated market structures. As a result, the value of European telecoms may be at risk of decline compared to other regions like the U.S. and Japan. This situation has started to lead investors to explore opportunities elsewhere. Simultaneously, as energy prices increase, the emphasis on creating a greener landscape means offering eco-friendly solutions is an essential factor to selling telecoms in Europe. 

What does this mean for you as a startup with an eye on Europe?

Well, in a cautious investment climate, your compelling value proposition is crucial for attracting buyers in the European telecom market. Amid financial fluctuations, showcasing expertise, product knowledge, and a proven track record is vital for selling your telcos in Europe. How can your product help European telcos increase customer base or customer stickiness? How can you help them stand out?

Strategies to Sell to Telcos in Europe

With help from our telco expert, Nigel Pollard, we’ve put together some essential strategies to assist you in broadening your telco market presence in Europe. Focus on your telco sales strategy over the slower summer months by assessing what is and isn’t working for you:

• Explore New Customer Bases - During this summer period, it’s a great time to explore expanding into new customer segments. Consider testing in new verticals or targeting untapped country markets. For example, targeting smaller businesses aiming to optimize efficiency through technology adoption.
• Broaden Market Reach - The telco industry, despite its established giants, offers opportunities beyond Tier 1 operators. Potential customer segments include: Mobile Network Operators (MNOs); Mobile Virtual Network Operators (MVNOs); Fibre Operators and Altnets; Business to Business (B2B) players; Business to Customer (B2C) players; installation and IT companies; System Integrators (SIs), and data centers.
• Reevaluate Market Fit - Evaluating your European market positioning and strategic partnerships is crucial for charting your course in the upcoming months. Gathering customer feedback to comprehend their needs, assessing partner-generated revenue, and discussing their viability are invaluable steps in this process.
• Differentiate Your Offering - Highlight what sets your solution apart and how it addresses customer needs better than mainstream alternatives. You’ll need to showcase how your technical capabilities create a distinctive value proposition and how your offering compares to major Original Equipment Manufacturers (OEM) suppliers such as Ericsson and Nokia. 
• Strategic Targeting - After some comprehensive training, compile a priority target list. Identify key decision-makers within your target companies and map out your contacts. Seek feedback and set up meetings with friendly contacts to refine your approach prior to September. 

Successful Telco Sales in Europe 

Considering the strategies that successful telecommunications giants in Europe have employed could offer valuable insights for shaping your own approach. For instance, the case of large operators such as Germany's Deutsche Telekom and Spain’s Telefonica highlights the significance of prioritizing digital transformation of products and adapting to the changing market dynamics post-pandemic. Both organizations place a strong emphasis on smooth interactions amongst products and services.

Takeaways from this for selling your telcos in Europe include: the importance of customer-centricity, embracing digitalization across all service dimensions, and guaranteeing exceptional network performance that delivers dependable, top-notch connectivity. You might wish to consider incorporating these top digital trends into your services which are shaping the telco industry:

• Artificial intelligence
• 5G networks
• Internet of Things
• Robotic process automation
• Big data
• Cloud computing and SaaS
• Cybersecurity

Do you offer a solution in one or more of the areas above? Now is the time to be launching your tech business in Europe.

As the future of telco digital transformation continues to unfold, with the emergence of 6G standards and specifications, staying well-informed about these trends will ensure your competitiveness when it comes to selling telcos in the European market. 

We can also take a look at Orange's dedication to sustainable strategies, like their collaboration with SHV Energy – an off-grid energy distributor – to enhance gas delivery routes through IoT optimization. This has resulted in substantial carbon emission reductions and exemplifies Orange's allegiance to supporting clients' sustainability objectives, particularly in the face of energy challenges. Incorporating similar partnerships into your approach can effectively showcase your commitment to clients and enhance your competitive advantage for selling to telcos in Europe.

Challenges and Opportunities of Selling to Telcos in Europe

As we’ve mentioned, European telecommunications companies have faced significant challenges in the past decade due to factors such as inflation and sluggish economic growth. Alongside insights provided by Nigel Pollard, we have highlighted essential strategies to navigate this period effectively. However, what additional obstacles should you remain vigilant about when it comes to selling telecom services in the European market? Spiceworks has laid out some of the challenges you might face and how these can present opportunities to adapt to the evolving telecoms landscape in Europe:

1. Regulatory Frameworks - The European Union (EU) enforces stringent regulations to prevent mergers that could lead to market domination. If you’re a smaller company seeking extensive mergers, we remind you to be cautious of this as you could face potential blockades. Perhaps consider venturing into partnerships, fostering connections with regulatory bodies and key stakeholders, and offering innovative products/services to encourage a healthy competitive environment.
2. Government Authority - Numerous European national governments hold shares in the telecommunications sector, influencing corporate decisions. As a result, potential investors exhibit caution when considering involvement in the telecom industry due to government-imposed constraints. To navigate this challenge successfully, it's vital for you to actively engage with these government authorities and establish mutually advantageous agreements with investors, addressing concerns arising from government veto rights. You can then enhance investor confidence and facilitate successful transactions in the European telecoms market.
3. Infrastructure Investment - Due to financial challenges and the need for service upgrades, several European telecommunications firms have opted to sell off segments of their infrastructure, such as mobile towers. This is a response to industry-wide debt and financial limitations. Consequently, their overarching strategies are facing disruptions, prompting a search for partnerships that align with their new approach. For example, they might seek services that enhance their 5G offerings. This presents an avenue to grasp the financial landscape of these providers and customize your services accordingly, effectively meeting their requirements. And, in these tighter times, they are always looking for ways to create customer stickiness.
4. Evolution of Artificial Intelligence (AI) - Artificial intelligence (AI) is an increasingly developing technology that could disrupt international telco business models by automating tasks previously offered as services. Nevertheless, you can view this as a chance to harness innovation and create more streamlined services that align with customer needs. Moreover, the rise of AI is projected to stimulate mergers and acquisitions, providing an avenue for you to strategically position your company for market consolidation and capitalize on cost-saving prospects. Embracing this emerging technology can serve as a pathway to achieving technological growth and maintaining competitiveness in the evolving landscape.
5. Data Privacy Concerns - Leading European telecommunications companies like Telekom, Vodafone, Telefonica, and Orange have explored the idea of selling customer data to advertisers, which has understandably raised privacy worries among users. When selling your services in Europe, seize the chance to tackle these concerns. Businesses capable of providing data anonymization, secure platforms for data sharing, and services for navigating data protection regulations could carve out a crucial role in assisting telcos to leverage this emerging income source. And your full sales cycle must be GDPR compliant.

To wrap up, navigating the challenging economic landscape of selling to telecoms in Europe demands strategic planning and seizing opportunities during the summer period to fortify your competitive edge. Addressing regulatory challenges, government influence, sector debt concerns, eco-solutions and leveraging data privacy and AI considerations can position you ahead of the competition. Drawing insights from industry giants like Deutsche Telekom and Telefonica offers valuable lessons for your market strategy, ensuring successful telco sales in the dynamic European market. 

Partner with someone who has been there, done that. Sales Force Europe has been building relationships and selling to European telcos since we began in 2003. We are also an official member of the Telecom Council, which helps introduce startups to global telcos and major telecom vendors. In addition, we have been working with the Swisscom Third Party Services program since its inception in 2018. 

We continue to have a proven track record selling to telcos in Europe, as well as key telco partnerships around the world. Contact us now to see how we can help with your European expansion to the competitive and compelling telco market.