Most managed service providers suck at sales and marketing. I’m not trying to throw stones at anyone, it’s just the truth about our industry in general. If you are capable of admitting it and want to learn to do something about it, please read on.
Josh and I met with the executives of a much larger company recently that is looking at acquisitions in our marketplace.
The were talking to us specifically because they were looking to add some additional service capabilities on top of their current service offerings, thereby increasing their average sale.
While sitting with this company and listening to their growth story (roughtly $150M annually; reached in 10 years), I began to ask myself:
“Why are they able to grow that fast, and we are not?”
So I started to ask questions to figure it out. It turns out this company offers 1/100th of the service that we offer our customers on a daily basis, the service is ridiculously easy to provide, and yet they are growing like mad! My first reaction was:
“What the F#$@?!? That doesn’t make any sense!”
Once I got my head screwed back on, I realized that it made perfect sense, and here is why:
They are selling a service to a very identifiable buyer that wants what they have to offer because it helps them do their job.
That may not sound earth-shattering to you, but it certainly has been for me.
Think about it. Who are you selling to? Most of the MSPs that are reading this are selling to small business owners or members of their executive team. What are you selling? Most MSPs are selling some sort of management and support package.
Two important lessons here:
- Small business owners are not an easy group to reach
- Nobody WANTS to buy management and support
That’s a tough combination, which is why we don’t have a 900 lb guerrilla in our space yet.
So, what to do about it?
My answer: change the business that you’re in.
I mean it. Look, nobody wants to buy management and support services. They want to buy technology that makes them more profitable, makes them look better to their customers, or makes them feel like a big-dog when they are able to work on their boat and not miss a beat.
They expect management and support to come with that technology, and they are pissed when they have to pay extra to get it. Believe me, every customer that you deliver management and support services to would much rather do without you!
If you look at any of the fastest growing MSPs out there, the far majority of them are not selling general management and support services. They are selling some specialized offering - hosted Exchange, managed security, or an industry-vertical solution - that has management and support built into it. And if you think about it, the more narrow their offering gets, the easier it becomes to identify a specific buyer.
We’ll be making big changes at Everon this year to take advantage of this lesson - I hope you do too!
MRC
