In the cloud collaboration market, 8×8 lacks the name recognition afforded other competitors such as Facebook, NICE inContact, Google, Slack or Zoom. However, the company stands out as one of the first to integrate UCaaS (focused on employee communication and collaboration) and CCaaS (focused on contact center agent interaction). The result, XCaaS (or “Customer Experience as-a-Service”), could propel “8×8” out of the pool of “wanabees” and onto the VIP list.
8×8 is a “cloud-first” provider of voice, video, chat, and contact center solutions. Founded in 1987, the company is global, with more than 1,800 employees serving organizations residing in 150 countries. 8×8 earns revenue from four sources: subscriptions to communication services; customers’ usage of select platform services; sales and rentals of office phones and other hardware equipment; and professional services.
8×8 takes a more aggressive stance
In recent years, 8×8 has placed increased focus on the mid-market (customers generating $25K to $100K Annual Recurring Revenue) and enterprise (customers generating more than $100K Annual Recurring Revenue) segments. Even more currently, 8×8 instituted key management changes that signal a more aggressive stance.
In December 2020, Dave Sipes was signed on as CEO moving over from the COO position at RingCentral where he blossomed the company from a niche provider of cloud calling to a leading UCaaS player. During the quarter ending June 30, 2021, 8×8 hired Walt Weisner as its new Chief Customer Officer.
The pair of executives has their work cut out for them. When the Covid-19 pandemic hit, companies found themselves scrambling to maintain communication and collaboration for an entirely remote workforce. Consequently, demand for UCaaS soared. As the pandemic wore on, in-person engagement with companies became treacherous if not impossible and thus utilization of contact centers increased. With contact centers suddenly very much in vogue, the popularity of CCaaS spiked.
At the same time, the contact center’s span of influence spread beyond customer service agents to include other teams with a stake in customer satisfaction such as sales and marketing. This phenomenon reflects the chief mission behind XCaaS – raising engagement between employees from all parts of an organization and customers to drive the customer experience.
Covid-19 pandemic drove rapid development
While the term “Customer Experience as-a-Service” sounds gimmicky, the underlying principle is anything but. The Covid-19 pandemic drove much more rapid development and adoption of cloud-based communication, collaboration, and customer service technology than if it had never occurred. With the hybrid work environment emerging as the ‘new normal’, these technologies will remain firmly entrenched.
However, that is no guarantee that 8×8 and its ‘eXperience’ XCaaS offer will be successful. The company faces stiff challenges. 8×8 is a “cloud-first” company at a time when many potential customers are still maintaining a mix of premises and cloud environments. 8×8 is narrowing its addressable market while simultaneously pursuing profitability.
Second, 8×8 is increasing its focus on larger customers. While still targeting the SMB market, this could put a damper on plans to exceed break-even because the SMB market represents vast potential due to the number of businesses in that segment.
Also, 8×8 is betting that companies will find the idea of optimizing external collaboration as compelling as they do the idea of optimizing internal collaboration. Sales of ‘eXperience’ will serve to measure the wisdom of that gamble. It could also determine whether 8×8 eventually gets its wish to be inscribed on the “VIP” list.