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CPaaS in 2021: Evolving Channels and Use Cases


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As traditional CPaaS customers like Uber, Lyft, and Airbnb and typical revenue-generating applications, such as airline boarding notifications, experienced a huge downturn due to COVID-19, industry experts were concerned CPaaS vendors would see reduced traffic and revenue. In fact, just the opposite happened.
Uber ridesharing was replaced by Uber Eats, take-out and delivery replaced in-restaurant dining, and in-store shopping was replaced with online ordering and curbside pickup: All creating demand for API-enabled notification and alerts. CPaaS was invaluable in helping businesses transform how they work and engage with customers in a contact-free world.
CPaaS Background
While cloud and all things “as a service” showed their value in 2020, communications platform as a service (CPaaS) was a star of the show. CPaaS provides cloud-based APIs to developers on a service basis, making it easy to add communications capabilities to a business’s core applications. Basically, CPaaS platforms use APIs to embed communication channels and capabilities, including messaging, voice, and video, into business applications and processes. CPaaS takes the various communications components and makes the basic functions more modular, making it easier to add different communications components to applications and business workflows.
CPaaS also allows for the customization that businesses require, eliminating or reducing the need for “one-size-fits-all” applications. Before CPaaS, it was more challenging to integrate and embed communications into applications, requiring specialized developers and engineers. CPaaS’s per message, or pay-as-you-go, pricing model made these capabilities more accessible to all types of businesses.
Typical CPaaS use cases utilize text/SMS messaging, as well as voice and video for a variety of use cases, including:
  • Notifications and alerts
  • Password updates
  • Appointment reminders and confirmation
  • 2-factor authentication (2FA)
  • Status updates, such as package delivery
  • Real-time customer support
  • Anonymous communication or number masking, connecting parties while ensuring privacy (e.g., Uber, Airbnb)
Channel Choice
I recently spoke with several leading CPaaS vendors about their experiences in 2020 and expectations for 2021. In terms of channels, messaging/SMS still represents the bulk of CPaaS traffic, but video usage greatly increased in 2020, with even higher expectations for 2021. In fact, Vonage has seen its video traffic double in the past year, with 80% of its recent use cases spurred on by video. Bandwidth notes that it also saw an increase in video, as companies endeavor for meaningful, personalized face-to-face interactions.
As businesses look for ways to replace in-person interactions, CPaaS makes it easy to add video to websites and applications, video-enabling applications from customer support to telehealth to insurance claim processing.
When it comes to channels, SMS is still the cash cow. While SMS plateaued globally, it remains a guaranteed fallback to reach consumers and patients, Bandwidth noted. As brands search for increased ways to reach consumers, SMS’s ubiquity and asynchronous capabilities make it an ideal channel for customer interactions.
Voice continues to play an important role in the CPaaS world as well. For example, Twilio notes that while SMS is the easiest channel for most interactions, customers want to be able to escalate to a voice interaction if and when there’s a problem. Whether it’s an Uber or Lyft driver who can’t find the passenger or a problem with a food delivery order, it’s important for businesses to support customer and providers voice interaction when necessary.
Unique Use Cases
As businesses change the nature of customer relationships and move to digital communications with clients, they’re also redesigning the experience, leading to unique customer use cases. For example, Twilio customer Nike provides a fully integrated experience that allows athletic shoe experts to give advice to customers, who can then pick up the shoes curbside on the same day.
Emerging real-time, asynchronous video use cases include education and distance learning, remote realtor viewings and virtual open houses, HR recruitment and remote interviews, and even online dating apps.
Of course, video is increasingly being used for customer service, as consumers are more open to video-enabled customer care. Contact centers offer tremendous opportunities for CPaaS providers. Case in point, 2600Hz is working with customers to customize their contact center solutions to fit specific needs, including supporting work-from-home agents. Vonage also sees an increase in the use of CPaaS to provide SMS, chat, AI, and chatbots for customer service, supporting customer self-service applications.
I expect a huge rise in the number and types of CPaaS use cases in 2021, as organizations reimagine the way they do business. There’s no limit to the types of use cases developers can create, helping businesses and consumers streamline workflows and enhance communications.
For example, as I was shopping for a new dishwasher recently, I discovered that my local appliance stores were all out of stock with a 3-4 month wait. It would have been nice if the various stores could notify me via text when they’re expecting a shipment, including information on the dishwasher models available, and allow me to place an order for the earliest available model in my price range. Additionally, it would have been helpful to have the option to talk to a live person for any questions about the different models. CPaaS use cases are only limited by the imagination.
2021: CPaaS and COVID-19 Use Cases
If 2020 was the year for contactless pickup and delivery, 2021 will be the year of COVID-19 contact tracing and vaccine distribution. Individuals notified about COVID-19 exposure can connect with a live agent/contact tracer via video or voice to review instructions, while local agencies can automatically send out testing appointment reminders and more. Hospitals and pharmacies can send outbound vaccine notifications, set up appointments, send appointment reminders, and enable text or voice chats between patients and health care providers to answer any questions or discuss side effects.
Avaya OneCloud CPaaS is being used by healthcare providers and government agencies for contact tracing, helping organizations customize and deploy automated processes to help with vaccine rollout, identifying and reaching priority populations, appointment management, safety monitoring, and more. Avaya OneCloud CPaaS is also used by health providers to send automated outbound voice calls and SMS notifications to increase awareness of signups for the vaccine.
Twilio also has a vaccine distribution program that lets health care providers and agencies use digital communications to send mass notifications about COVID-19 vaccines, create self-service experiences for patients, conduct health surveys, and more.
A CPaaS diagram
Source: Twilio
2021 Expectations
As businesses transform the way they interact with customers, CPaaS use cases are transforming as well. For example, Bandwidth notes that discussions with health care companies will no longer focus on sending SMS for prescription pickup notifications but on how to create personal conversations through voice or video while ensuring security and privacy.
In the future, CPaaS discussions will move beyond developers and will increasingly include line-of-business owners who understand the value of APIs. In addition, the types of business customers will also change. As Vonage pointed out, CPaaS has crossed the chasm, going beyond early adopters and disrupters to traditionally conservative companies like Allstate that have begun to embrace CPaaS. You should expect an acceleration in the types of companies and verticals that dip their toes in the CPaaS water in the coming months.

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This post is written on behalf of BCStrategies, an industry resource for enterprises, vendors, system integrators, and anyone interested in the growing business communications arena. A supplier of objective information on business communications, BCStrategies is supported by an alliance of leading communication industry advisors, analysts, and consultants who have worked in the various segments of the dynamic business communications market.