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The RetailWire Podcast
Assessing the State of Small & Mid-Sized Businesses in 2024
Discover how small and medium-sized businesses (SMBs) navigated the rocky economic landscape of 2023, as we sit down with Khurjekar , Chief Revenue Officer, Business Markets and SaaS for Verizon Business. She offers a wealth of knowledge on overcoming challenges like inflation and capital access, while also providing insight on leveraging technology for operational efficiency. Aparna sheds light on the strategic tech investments that are enabling SMBs to not only endure current economic pressures but also to improve customer experiences and make smarter business choices.
Alongside Aparna, we explore the critical 'four Cs' that act as the backbone for businesses striving in a digital-first economy. The discussion also raises awareness about the importance of SMBs protecting themselves against the rising tide of cybersecurity threats, adding a layer of urgency for companies to adopt robust digital defenses.
As we cast our gaze forward, we examine the exciting prospects that cutting-edge technologies like augmented and virtual reality, telematics, and the Internet of Things hold for transforming industries. We share how Verizon's Connect telematics system is already making a significant impact on vehicle fleet management, and we discuss the promising economic outlook for 2024, reflecting a spirit of optimism among SMBs. Our conversation is a testament to the resilience and innovation of small businesses, a celebration of their contribution to the economy, and a commitment to keeping you informed on the latest in retail innovation.
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Hello everyone. My name is Mark Price and I am a member of the Brain Trust at RetailWire, which is RetailWirecom, a central location for cutting edge thinking about the trends that are going on in retail today. I'm very lucky today to have a special guest with us, and I'm going to let Aparna introduce herself and give us a little bit of background on her role at Verizon, and maybe a little bit about how you got to be doing what you're doing as well. So, aparna, tell us some things about you.
Speaker 2:Sure, hello, mark, I'm here in New Jersey, quite cold here. Very nice to be here on this podcast. So Aparna Kurjaker and I am the Chief Revenue Officer for Verizon Business small and medium and when I say small and medium it's anything with FTE under a thousand, so under a thousand employees, so you're really talking about a large swath. Almost about 99.7% of businesses in the US fit in that and we've got about 30 million of them in, over 30 million of them in the US. And my remit really is to actually strategize, bring the right products and solutions at the right value proposition to the customers, the businesses that we serve across the country, across all channels I'm talking frontline salespeople, I'm talking tele sales, digital partner channels and also bring in SaaS solutions that Verizon either partners or develops within Verizon.
Speaker 2:And you asked a little bit, mark, about myself and how I got here. I call myself an accidental salesperson. I am a technologist. I actually started in Bell Labs as a software developer doing chips at design, always in the telecom industry. Got a chance to work in Motorola on a whole bunch of marquee devices like the Razor, dating myself If anybody remembers that device, I call it the first through smartphone and in Verizon I have done various jobs, including really managing the network and doing the operations for the network, doing products on the consumer side, doing digital and then, finally, I found myself here and just loving the job and loving bringing everything, including the core technology, to the fore to serve our customers in the small and medium space.
Speaker 1:That is great. Now, as you look at the small and medium space, which, as you mentioned, is an enormous percentage of businesses in the United States, 2023 was unusual. There were so many things going on globally, as well as domestically, to lead small businesses to really struggle with their direction going forward. Now, obviously, in your role, you've had to really try to get an understanding of what small and medium sized businesses are thinking about, and I wondered if you could just from a perspective of 2023, just give us a little bit of background about what was in the head of your customers and you may want to say you know the really smaller ones, maybe the medium and the larger ones. You may want to break it. I don't know if they all had the same issues or not.
Speaker 2:Yeah, mark, you bring up a very good point. I mean, sometimes we just put with a paintbrush, just say SMB, and you know, it's kind of suddenly, miraculously, everything under that swat of that moniker, right, smb. But honestly, there are companies of all different shapes and sizes, some early stage companies, some companies that are perfectly okay in the service industry, especially with five and 10 people, and some that are 500 to 1000 that are literally touching enterprises right, the MetCap company. So we see everything in across the board. The good news is that all of them have kind of similar headwinds and tailwinds and, quite like, where the enterprises are, how those tailwinds or headwinds impact them can be different, depending on how deep their pockets are, which typically, for small and medium businesses, aren't that deep. The access to capital, which typically, when your inflation's high interest rates are high, isn't that accessible, right. So those things change, but the headwinds stayed the same.
Speaker 2:You call that 2023 as a unique year and honestly, we were hoping all of us were that 23 was a little bit of a.
Speaker 2:You know, let's get back into the steady state after the pandemic and all that we saw as the aftermath of that, especially through supply chain disruption and just sort of this whole question on are the customers coming back, are they coming back into the stores, are they staying digital and such 23 did not really end up where we wanted it to be, because there was a lot of volatility, especially given, as you called out, the geopolitical landscape and what it did in terms of the uncertainties, what we saw out in China and others, but most importantly, with the inflation and the way it was on the rise, and what we saw really was, in times like that, companies across the board, notwithstanding the size and what stage they're in, really hunkered down.
Speaker 2:So the thing that we saw was a lot of the ambitious projects on the top line kind of either slowed down or were put on pause, and a lot of the cost initiatives. Be it. Hey, how do I use my dollars towards marketing the right way, or how do I make sure that I am using workforce and support for the workforce the right way with data analytics and leveraging the right kinds of solutions and automation, or how am I thinking about better serving the customer from a customer experience perspective? Those things came to the fore, but, regardless, what I will tell you is independent of whether it's already respective, whether it's the top line or the cost measures. Technology was in the forefront of every discussion that we've had, and when I say technology it starts with kind of ensuring that they've got the basics of technology done and then finding the right solutions that can help them with the efficiencies. Majority of the projects we saw were in that realm.
Speaker 1:That makes a lot of sense. I'm sure that the fear of a recession which did not come in 2023, combined with interest rates being as high as they were and the cost of raw materials and the products that retailers sell continuing to go up and the retailers not having a lot of margin to give away to try to keep prices consistent. In many cases, the retailers were forced to pass it along to customers, who looked at it as yet another sign of their personal budgets getting squeezed, which tended to mean they were more thoughtful about purchases. They forego purchases or delayed them. The consumers did, which translated, it seemed, from what you said, into the experience of the retailers as well, doing exactly the same thing. Now, you can't talk about 23 without talking about AI. Ai was a huge game changer in 23, at least in consumer perceptions, not necessarily in what happened in 23, but it created a lot of fear. I'm wondering, as you talk to customers, as you talk to your salespeople, what happened and what did it mean?
Speaker 2:You are right. I think, mark, you hit it on the nail. The consumers suddenly woke up to this whole story around artificial intelligence and how it is that we can build from there. What I will tell you is, without knowing or calling it AI, or knowing that they were using AI, my sales team and the consumers were already seeing the benefits from different businesses starting to use AI. What do I mean by that? I will not go into the differentiation of ML versus deep learning, versus cognitive versus AI, versus what we're talking now about gen AI. What I will tell you is the pure models.
Speaker 2:Taking a lot of data, doing the assessment and creating pure models that can actually help us define how to move next have been in vogue across a lot of solutions. If a company is using the right kinds of solutions to ensure that they've got the right marketing ROI, the dollar is going towards the right channel and they're leveraging it for the right kind of a demand gen, they're using AI. If you're using any form of a chatbot in your customer service which, by the way, we are starting to see a lot of small medium businesses get to, especially with the paucity of skilled labor and the increase that they're seeing in workforce costs. They're using AI If they're using it for fraud or security. Verizon offers a whole bunch of security solutions where we are constantly monitoring every bit and byte that's passing over our network. We are using AI to be ascertaining what kinds of traffic is moving across, and what is it that we should be doing today and next?
Speaker 2:Ai is already being in use. I was talking about sales. My sales team is leveraging a lot of tools that some homegrown, some third parties that we've integrated together, to actually be able to help them serve the customer better. What is this customer about? What is it that they need? How is it that I can serve them? It's the next best action. That's all AI. The good news is, ai is not new, although it may be embedded in the solutions that you're using. The even better news is that, with the real big walk story around AI now, everybody is starting to leverage that in big ways so that we can find more efficiencies, both for top line as well as for the margins.
Speaker 1:It sounds like what you're saying is that these retailers may not, in their minds, be necessarily using AI. They're using tools, maybe tools that are similar to what they used before, but they're using them in much bigger, broader and more meaningful ways. And oh, by the way, in the back room don't tell anybody there's a bunch of AI spinning away that is improving it.
Speaker 2:So solutions are getting more and more sophisticated. As these models are getting a lot more sophisticated, they're getting better solutions, they're getting more efficiency from these solutions, and there are newer and newer kinds of solutions that are available for almost everything. You know how we used to say there's an app for that, there's now an AI for that. Right and now?
Speaker 2:we're starting to improve on that. It could be embedded in a SaaS solution. It could be embedded in what it is that you're already doing and leveraging. But that's the goodness and that's what is extremely exciting. The thing that we get really excited about is for AI or any of these technologies to run, you really need what we call our foresees and the customer's foresees, and I'm talking about any business.
Speaker 2:It starts with making sure that your bits and bytes can transfer from humans to machines, to the next machine, to the next human, and that's all about connectivity, and we are all about kind of reducing the digital divide there, improving the connectivity with all our investments there. Then you move into making sure that it is secure. So cybersecurity and ensuring that the end to end device protection, network protection, data protections all accounted for Right, just with the increase that we are seeing and you'd be surprised, mark, many a times I'm talking to small and medium businesses and they're not aware. They're like, oh yeah, that whole ransomware thing, that's all an enterprise, because you hear these big companies being ransomware and held hostage. But honestly, what's happening is majority of the ransomware attacks are happening in the small and medium businesses because they're easier and quicker to get and majority of them are for financial gains, so making sure that's yes.
Speaker 1:My perception on that is that the ransomware is just simply trolling out there for anywhere they can get into and because there are so many SMBs out there, they just end up doing a lot of that. Am I wrong?
Speaker 2:You're right, I'm taking you for my next sales call. We can make sure that the small and medium businesses start becoming a lot more aware of that. The third piece then becomes you have, with this hybrid workforce even for small and medium, a lot of people either in the business or sitting outside needing to communicate. So collaboration tools, the right kinds of tools that you can be offering out to your customers to be available 24 seven as well as to your employees very important. And once you have these three Cs, the fourth one is very important also cloud and how it is that your data strategy is situated. A lot of small and medium businesses are starting cloud native. Many of them are hybrid.
Speaker 2:And that helps because once you have this platform of the four Cs, now you can be talking about what SaaS solutions do I need for my online presence? What do I need for my productivity tools? What do I need for CX? And start building that portfolio the right way and solve for the customer needs.
Speaker 1:Excellent. So can you go through the four Cs one more time? So connectivity was the first one, communication was the last. Okay, cyber security, yep.
Speaker 2:The third one is making sure that on top of it, you've got the collaboration tools and the cloud and honestly, we help every company, no matter what size, really think through their portfolio of solutions across these four firsts Sure up your connectivity, make sure it's secure, make sure you're bringing in the right collaboration tools from Verizon elsewhere we have a whole bunch that absolutely work for every size of small, medium and enterprise business. And then make sure that you've got the right choices you're making on cloud on top of it. Now you're set to move into the world and you know what you wanna pick an AI solution or solution based on AI. You've got that. You wanna use Gen AI and leverage any of the chatbot functionalities and such that are starting to show up there with natural language processing. You've got that as an opportunity and you can start building from there, and I'm sure you're seeing this as well.
Speaker 2:But we love the opportunity for small medium businesses to compete almost in a democratized way, right? Because, one, they have access to a lot of these solutions. But two, guess who is more propense to going and taking these on and taking on a little bit of the risk to say I don't know how this is gonna work. Let me test the solution. It's that small medium business because they're nimble and they are really trying to go differentiate, so they're almost at the forefront most of the times because of that, in adopting technology.
Speaker 1:How do you balance that then, aparna, with the fact that they have limited resources? Because when I ran a small company, I used to say that I could put. The good news is it was my company. I could put a chip on any number on the roulette wheel that I wanted. The bad news is I only had four chips.
Speaker 2:That's right, and this is where I think we come in to help them with just making sure what is absolutely non-negotiable like don't skimp on your connectivity. Let's just make sure that you've got the right security on it right. Let's make sure that you are able to communicate very reliably. On top of that, and now what you've got to do is really decide on where it is that you're standing with your value proposition and your differentiation right. Are you a cloud native company, a digital first company, and where is it that, then, you invest there? What is your marketing strategy to tie to that?
Speaker 2:You may not know this, but one of the things that Verizon does is we have a CSR group that has invested heavily in a Verizon digital ready platform only for small and medium businesses. And, mark, what we do is we help a lot of these small and medium businesses. Come in and learn what it means to run a business, what it means to be positive and profitable and how you grow, and where is it that you need to be taking chances. You can even bring in mentors and really serve them in a way where they're thinking about their business holistically.
Speaker 1:That is great. Let me switch subjects for you and just ask you about some other technology that with the CES show, the Consumer Electronics show, just finishing up Once again, we've seen a lot about AR, VR, so virtual reality goggles and glasses and in prior years there was a lot of noise about this and it didn't seem to cross the chasm, it didn't seem to become in any way mainstream. I was wondering, from your perspective, you know, as you look at the technologies out there, do you think this is the year coming ahead where this becomes mainstream, or are we still a few years out?
Speaker 2:Yeah. So here's the thing AR, vr, anything around robotics very, very important innovations happening there. We've also heard some big companies get into the fray this year. Right, we're looking forward to some new AR goggles that you know I'm sure are going to be the sort of that. Next pushing the envelope. My take on this is at the price point we are at, there are going to be niche solutions we're seeing them even in mid-sized companies on the factory floors for training but those are niche solutions. If you want scale, we're going to have to get one zero out, possibly even two zeros out, from that price tag and until that happens, I think the innovation in terms of content as well as the use cases are only going to be few and far between. Does that happen this year? I suspect not, but I think we'll keep seeing that envelope getting pushed in each and every year.
Speaker 1:I would agree with you 100%, and I saw that the goggles are still, you know, 1,300, 1,500, 3,500. In no way is it going to become mainstream when it's. If you imagine how iPhones migrated up to be $1,000 items. They didn't start that way and then, over time, there were more features, more benefits and the price kept going up. This has started all the way at the top and as a result of it, it's going to be for specific kinds of business uses which I think are fascinating, particularly for training. It can be amazing, but for a mainstream consumer audience, I can't really see that happening.
Speaker 2:Yeah. And we didn't even talk about sort of the experience and how comfortable people are with wearing a glass all the time and there's more work to be done from an ergonomics and the comfort level, the ease, but I guess generally the word it is that the world is moving there. You are going to have these smart devices, augmented virtual reality for the right kinds of solutions and extending them into. You know more and more of that world where everything's connected and, if you add, go ahead.
Speaker 1:Yes, I'm going to say if you add AI, exactly, ai would permit it to have more capabilities over time, but the cost is still at the moment an overwhelming barrier to entry. Do you have a couple case examples of specific clients, maybe in the smaller and in the larger, where you've really made a difference in 23 in what they were going to do when they started? You came in and you were, in effect, a force extender, so you were more staff, but you were also a thought extender to help them do things that they never really thought about doing.
Speaker 2:Yeah, so I have 1.6 million of those. Where do you want me to start?
Speaker 1:How about a small one?
Speaker 2:Yeah, so, but I will tell you across the board, day in and day out and I personally call customers, those who were with us, those who leave us, sometimes few of them how we can bring them back, and we learn a ton and we keep improving. One of the things that we are trying to do is make sure that we bring a complete portfolio of solutions to these customers. So we have tremendous number of examples and how it is that we've been able to transform mid-sized companies, small-sized companies, with a box now which they can connect, don't have to wait for the truck roll to come in and do connectivity in a big way. So Jake was talking about the internet that he has. We love fiber, but where there is in fiber, we've got a box. Literally, I can ship it to you today. You plug it in, turn it on and you can connect multiple devices to that box through Wi-Fi and that has 5G in the back end and it can take you back into wherever it is that you want to connect.
Speaker 2:And we have seen businesses food trucks, for example just light up businesses temporary solutions, like in construction, where it takes months to get connectivity into a construction site and by then your construction may even be done where now all that they do is place the order.
Speaker 2:Next day they have the connectivity and imagine the kinds of solutions I see with that construction company light up on day one, not just to start connecting outside but also within.
Speaker 2:One of the areas that we are starting to move into in a big way is through solutions like Connect that we have, which is an aftermarket. Telematics is making sure that we're bringing a lot of connectivity into devices and connecting that with the enterprise solutions as well, and we're seeing some huge amount of growth there, not to say now, and this was a little bit of a surprise for me. You may have heard of private networks. These are solutions that we can create and stand up a completely secure, deterministic network, your own network in a warehouse on a factory floor and an entire building and lots of companies. Just yesterday I was talking to a company in which is a firm and we have a private network on the firm and they're using it to connect a lot of their ag tech solutions within the network and also help consumers with Wi-Fi there in a much broader coverage. So lots and lots of examples across all industries.
Speaker 1:So two questions for you. You mentioned telematics. Not everyone, I think, knows what telematics is. Can you talk a little bit about what that is, how you enable it and what the benefit is?
Speaker 2:Yeah, absolutely, thank you for asking that. So telematics is connecting cars in a way where you can be bringing in sophisticated solutions into the cars and taking a lot of the data from the car to ensure that you are doing predictive maintenance, travel logs, where is it that you can be improving on your fuel consumptions and such? So Verizon has a solution called Verizon Connect. It's our own solution which we offer for commercial vehicles. So think about a lawn mowing company having their own set of vehicles, or think about a even the postal services having their vehicles, connecting them in a way where the drivers get the right kind of information and the company can get the right information to connect back into enterprise on driver routing, car usage, idle time and also, through video, any form of driver distraction and saving lives through that.
Speaker 1:So lots of great examples with telematics that we're seeing and we are absolutely predicting every car out there being connected, every vehicle out there being connected for these reasons, Now people might look at that and get concerned because they would feel like they're losing their privacy in some way and it would contribute more to being watched all the time. How do you explain the benefits I'm thinking more at the smaller businesses so that the people who are using, who are going out on repair calls, for example, for a heating and air conditioning company, and you've got five texts and they go out, how do you keep them from getting upset or losing the message and the noise?
Speaker 2:So the first thing I will tell you is, through a lot of requirements coming from the government the FTC, eld requirements such companies have to keep a log of driver hours, vehicle hours, routes and such, so it's absolutely a requirement that's coming in in most industries.
Speaker 2:Secondly, this is a win-win situation because the driver and I have personally seen videos where the driver may get distracted and instantly this device is beeping and telling the driver you got to get focused again because you're about to go get into a collision of some sort. So we are making sure that the driver on the receiving end is seeing the value. They're also getting a lot of prompts on hey, this is a faster route, or hey, you can save gas in this way, or this is how you can improve your productivity, and there's a lot of coaching that's going on around that. And then, of course, the company benefits too. So we personally have seen little to no pushback from the employees because it's becoming more of a norm, but there is also a huge amount of value that the company is getting, but also the driver as well.
Speaker 1:That's great, thank you, and we were talking. We talked a lot about what you saw in 23. So now, as we're starting up in January of 2024, the Fed has indicated that they're not going to be increasing interest rates in the near term. What do you see in terms of the economic outlook? And then what do you see in terms of the outlook that your customer base has going forward?
Speaker 2:Yeah. So luckily for us, we are starting to see a little bit of the easing of the flow of capital. We saw it even in the CPI, the consumer index, through November and December. We had and lots of retailers most of the retailers had a good November, a good December, good holiday season. That's just a good kind of indicator on what's coming.
Speaker 2:We are starting to see a little bit of the opening of like yes, we had this project on pause, we want to go ahead and execute on it. We are expanding, we are going to go build a few more. So we are starting to see some of the sites and we need more connectivity. So we're already starting to see sort of the precursors of the opening up. Yet there is a little bit of the let's wait and watch.
Speaker 2:I think the one thing that especially companies of this size small and medium have learned through COVID is they've got to make sure that they are always, always looking out a little more around the corner and bracing for that and keeping a little bit of the market for those rainy days. So this is where we see, definitely see them being cautiously optimistic. The other piece is we are getting a lot of questions on like hey, how are you using AI Verizon? What is it that we can be doing with AI? How is it that you would suggest we use IoT and the right kinds of solutions to integrate back? So that's good news, which is both again from a top line, right kinds of growth, but also from an efficiency measure. It can help them and definitely something that they can continue to build on.
Speaker 1:That's great and I'm going to call you back. Can you define IoT and then say a little bit about how people use that?
Speaker 2:Yes, and thank you for asking about that, and I should have mentioned earlier. So, internet of Things. Actually, 10 years ago, when I started in the space of IoT, it was called machine to machine, so some of them, some of you may know it as machine to machine, but it's really Internet of Things and what this is is taking any device that's out there and connecting it back so it could be your watch. It's an IoT device, but it's also sensors or asset trackers, so you've got something which is a heavy equipment and you want to track it, what I called out with VZ Connect.
Speaker 2:That is a perfect example of an Internet of Things. It's connected back into the Internet and what we can do is, say, a company has a warehouse. How do you tag every asset in that warehouse and make sure that you know the whereabouts of that, what's going on a pallet and where is that pallet currently if you need to go track it. That's a perfect example from an asset tracking perspective. Utility companies are looking at IoT to make sure every meter is connected back into their main system, so we've got connectivity there. The good news on each one of these is they need to connect back into the mothership, and that's where Verizon comes in in a big way.
Speaker 1:And one of the real benefits of being able to connect that is to be able to predict in advance when machines are going to break down, so that if you know that a machine is likely to break down next week, you can do maintenance on it this week and then have it not break down. So you should be able to see superior performance, and that is both on the business side and on the consumer side. That is so well said, so it actually it has a tremendous predictive analytics, combined with IoT, is the game changer.
Speaker 2:Yeah, predictive fault tolerance and predictive analysis Analytics is a huge deal and definitely one of the big mainstays of IoT, I agree.
Speaker 1:So it has been a complete delight to talk to you today. Is there anything else that you would like to add to our podcast audience, as we talk about SMB and, you know, the market going forward? Is there anything that we've missed in our conversation?
Speaker 2:No, I think this was a great conversation. The one thing I would add is, sometimes, as we're talking to these businesses who may not be digitally savvy as yet, or who may be digitally native but don't know where to go next, who may be in the early stages and trying to figure out how is it that they scale All that I request them to do is just stop by in one of the Verizon stores, go to our website, get a tech check with us. It doesn't cost you anything, but we are help you because we want to make sure we're building the US economy in a way that one SMB is being built and we want to be there to as their trusted partners eat SMB, one at a time, no matter what shape and size, no matter what, what industry they're coming in with construction or retail or service we're here to help them work.
Speaker 1:And I think you also mentioned the training and support you have to help them actually in the running of their businesses, not just in how do you sell more Verizon product, but you can actually help these businesses succeed overall. Thank you, that seems to be something that's something that some of the smaller businesses particularly might really want to take advantage of.
Speaker 2:Yeah, so Verizon Digital Ready platform. You don't even have to be a Verizon customer to do this. You can get on their website, get on our website there on the Digital Ready platform. That are a whole bunch of podcasts, training materials how you manage your financials, how you go look for aid. We also have our own aid that we provide in terms of dollars. We also have some pro bono work that we do for legal support. We can connect you with right mentors in the industry as well. So go check us out, because we're here again to help the small medium businesses grow. They're the backbone of the US economy and we want to see that backbone get stronger and stronger and stronger.
Speaker 1:That's a perfect way to end the conversation today. Thank you so much for your time. Just to remind everyone, this podcast is brought to you by RetailWire. You can find us at retailwirecom, where we try to bring to you the latest thinking in retail, from supply chain to products, to pricing, to analytics, to artificial intelligence. We try to be on the cutting edge and provide that as a service to people who are learning more about retail every day, because it is constantly changing every day. So thank you very much and I wish everyone a great day.
