AIS taps SMEs to boost B2B growth in Thailand

Advanced Info Services (AIS) sees untapped opportunity in Thailand’s small and medium-sized enterprise (SME) market and is charting a course to drive business-to-business (B2B) revenue growth.

There are more than 3 million SMEs in Thailand, the majority of which are very small micro businesses. AIS counts roughly half of the country’s SMEs as customers, but there is “room to improve,” said Navachai Kiartkorkuaa, Head of Enterprise Marketing and SME Business Management Section at AIS.

Kiartkorkuaa shared how AIS is changing its approach to SMEs through service diversification, new sales channels and digital customer service.

Expanding beyond telco services

Until recently, the operator mostly sold mobile airtime to small business customers and recognised that it needed to do more to meet their digital needs. In 2021, AIS not only added more telecom services, including business mobile plans and fixed broadband, it also introduced ICT and digital marketing solutions designed for SMEs.

For ICT, the operator now offers cloud and mobile PBX services, antivirus protection, point-of-sale solutions for retailers, messaging packages for customer communications, and CCTV systems for hotels, all of which are provided on a pay-as-you-use basis as software-as-a-service (SaaS) products.

In digital marketing, the solutions are tailored to help SMEs build their online presence or improve business operations through tools such as an outsourced contact centre for customer services.

Kiartkorkuaa said AIS typically works with partners to create new products, much like it does for large enterprises. The operator worked with messaging app Line to develop a marketing service for small retailers. Leveraging location data from a “proximity beacon” installed in shops, businesses can attract more likely customers by sending promotional messages to people that pass by their premises.

Gaining momentum through the pandemic

Diversifying the product portfolio is a key part of the operator’s SME growth strategy as traditional telecom services reach saturation and small businesses are still reeling from the economic impact caused by the pandemic over the last few years. As in other parts of the world, many SMEs went out of business in Thailand after prolonged periods of lockdowns.

But Kiartkorkuaa said takeup of the new ICT and digital marketing services offset the SME market challenges.

“Since 2020, it’s been a terrible time for SMEs … If we didn’t do anything and we only relied on our telecom products, we would have had negative growth because many SMEs closed their businesses… Since we diversified our product portfolio, we have a good chance to keep growing in this segment”, he said.

New routes to market

AIS has also expanded its digital and physical sales channels to reach the diverse millions of small businesses in the country. The operator partners with local systems integrators (SIs) to sell its expanded product mix, which is an important channel especially in sectors where AIS does not have enough “domain knowledge”.

“Some of the ICT solutions we have added cannot be delivered by AIS alone. We co-deliver many of them with SIs and we enable SIs to resell our telecom products as well. So we empower them to serve not only their own product, but also AIS telecom services and ICT solutions,” he said.

Since the pandemic, AIS has also supplemented its 700 retail shops with digital shops via its website and mobile app as well as built an online marketplace for SMEs, called Biz App Mart, where customers can order SaaS ICT solutions.

More digital touchpoints

AIS is also making it easier for SMEs to interact with it. Accelerated by the pandemic when shops had to close, AIS has many more “e-services” available so that customers can order products, pay for them, and receive electronic bills via the operator’s website or mobile app.

“Growing the penetration of e-services is good for us because we can reduce our cost to serve and we also lower our customer costs because they do not need to travel to our physical touchpoints,” he said.

Tough market to crack, but worth the effort

Even though AIS has strengthened its portfolio and simplified sales and services for SMEs, Kiartkorkuaa does not think the operator successfully serves the segment yet.

The biggest challenges are understanding this fragmented group of business customers and creating the right services for them. As he explained, telcos cannot simply deliver scaled down versions of large enterprise services to SMEs and they cannot provide consumer products because their requirements are very different.

“We need to figure out how to serve this segment. [The customers] are not like consumers and they are not like large enterprises. This is the difficult part of how to serve SMEs … and we have room to improve,” he said.

The attraction of SMEs for telcos is the potential to gain higher-spending customers as average revenue per user (ARPU) for small enterprises is typically more than consumer ARPU.

“There are two sides to the coin: it is difficult to serve them, but it is worth it,” he said.

Looking ahead, Kiartkorkuaa sees potential in cybersecurity solutions for SMEs as well as certain Internet of Things (IoT) services. IoT solutions tend to address large enterprise applications, but he said there are near-term opportunities to provide SMEs with energy consumption solutions that can lower their energy costs given the current macro-economic environment.

Navachai Kiartkorkuaa will be speaking at the TM Forum’s Digital Transformation World Asia event in Bangkok from 12 - 14 March 2023.