Dialing SMEs for Growth Telecome giant Vodafone revisited its strategy to tap more SMEs and start-ups

Telecom major Vodafone India has revisited its strategy to tap more SMEs and start-ups. The focus is now on coverage, intelligence and automation-driven growth strategy to gain SMEs' attention.

Ajay Sehgal, National Head – Small and Medium Enterprises, Vodafone Business Services, shares the group's idea of putting SMEs as its center of growth.

As SME ecosystem is booming in India. How is the growth for Vodafone India's SME segment?

SMEs, which have revenue between Rs 10 crore and Rs 250 crore, is the fastest growing segment among four segments in the Vodafone Business Services (VBS), the enterprise arm of Vodafone India. The other three segments include global customers, large corporate and government departments. The SME segment has shown almost double of VBS growth, which is 20 percent year-on-year. Currently, we don't have the approximate figure in terms of number of SME customers.

Is there flexibility for start-ups to opt for pay-per-use model?

For us, start-ups are a subset of SMEs as they would initially fall under the same revenue bracket. Although we don't want to create the fifth segment for startups, we would offer the right treatment to them. In the SME segment, we have created a dedicated structure in different cities for managing e-commerce and m-commerce start-ups, understanding their needs and offering simple and scalable solutions on pay-per-use basis as initially they don't know how fast their growth would be and also they don't have funding to invest in the form of capital expenditure.

We will begin with Bengaluru and New Delhi while adding Mumbai, Pune, Hyderabad and Chennai by end of next month. This will give start-ups the flexibility to operate without the need to focus on non-core business activities.

How does it serve communication needs of start-ups and SMEs?

We have changed our market positioning from being the mobility player to a complete ICT player. Moreover, to take care of startups' communication needs including Internet lease lines, toll free services, audio and video conferencing, collaboration services, machine-tomachine services, and IT needs, we have Vodafone CloudStore where productivity, connectivity and collaboration needs of SMEs can be met on payper-use basis.

Does that involve traditional SMEs?

We are taking a vertical approach for this. We are doing research with different verticals, and on the basis of which, we are creating a portfolio of services relevant to traditional SMEs. We have planned to launch six vertical-specific
offerings including construction, manufacturing, hospitality, logistics, healthcare and professional services.

Any plans to bring Vodafone's incubator Xone to India?

Currently, there aren't any plans. There are already a number of incubators existing in India. So, instead of creating one of our own, we are looking to partner those, help their start-ups and participate in different start-up-focused events. We are already in discussion with NASSCOM regarding participation in different start-up events. It is important to note that working with start-ups in India and understand their needs is also new for us, so once we do that, we can definitely think of bringing Xone to India after couple of months.

Does the rise of telecom start-ups bother you?

No, we feel that we need to be more aggressive in the market, in which we are certainly. For SMEs, we are almost tripling our distribution model to serve them more efficiently and have introduced a two-tier model around six months back. We have already got 300 channel partners, close to 1,000 resellers and around 300 of our own retail partners, which we had targeted earlier. We are now in the process of building their capabilities. This will help us double our outreach in the SME segment.