Commoditisation of IT Services: Examples of Margin Growth Strategies that Work

Written by Richard Thomas

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    There comes a point in any industry when enough people know that the product or service being provided is valuable. Shortly thereafter, more people will start offering that product or service, because the market exists. 

    At that point, the product or service stops being unique and hard to find, instead it starts to become a commodity. The problem is that very often the primary driving factor for customers buying those particular commodities is price. Which is not such a bad thing when you are talking about something simple. But it could be very damaging to your business’ success when the commodity itself falls within IT services. 

    In the IT and communications space, there are only so many combinations of technology that can be offered, and if everyone is offering the same combinations, it’s very hard to differentiate yourself from the next new company on the block. 

    Fighting commoditisation of IT services using the Highlight platform

    The last thing that clients need is to base their decisions on who happens to bid the lowest. But that’s exactly what does happen. We, at Highlight, have dedicated ourselves to helping MSPs avoid commoditisation through our solution that offers unparalleled visibility into your client networks — in turn making it easier to identify problems, and relatively, identify solutions that prioritise value. Highlight allows you to — 

    • Gain total, holistic visibility into your client networks (this insight is accessible by the clients too)
    • Automate cellular or broadband signal strength and usage spike alerts 
    • Personalise customer experiences that prioritise transparent, regular communication
    • Tailor solutions and network evolution plans to unique client requirements 
    • Use data-driven insights to offer more value to your clients at every turn

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    Here’s a few examples of how three different companies with different niches are using Highlight to deliver superior results that set them apart. 

    Example #1: Delivering increased margin growth through in depth insights

    V12 Telecom has been a major provider of managed telecoms solutions to enterprise clients in the UK, Europe and beyond. However, like many other companies — even well established ones — they found their margins slipping as lower competitor prices forced a race to the bottom. 

    By partnering with Highlight, they were able to use the unique platform to dive deep into network performance data, so that both V12 and their clients can make the best, most informed decisions. In a world where the right network is business critical, this has given them the edge to stay competitive. 

    V12’s Direct Routing system in particular has been popular as more organizations move to cloud based solutions and digital communications, and Highlight makes it all easy to manage from a single platform. 

    Of course, when you’ve been in business for two decades, there are always newer companies trying to poach your best clients. The Highlight platform has given V12 insights that have allowed them to retain their existing customers while also expanding their reach. We afforded V12 unparalleled connectivity that grows margin and fights commoditisation of IT services using the Highlight platform. It’s the perfect combination of happy and loyal repeat customers, old and new. 

    Suggested reading: For more information on how Highlight have helped V12, check out our case study — ​​Highlight’s platform is an invaluable tool for closing new business and customer retention 

    Example #2: Using insights to deliver superior services

    Gamma provides a broad range of managed telecoms solutions to a wide range of industries, thanks to their network of reseller partners. However, before they partnered with the Highlight platform, it was a lot harder to monitor and report on the performance of those solutions in totality and in real-time. In other words, it became clear that standard monitoring tools weren’t enough to differentiate themselves from the competition and avoid service commoditisation. 

    Since Gamma signed onto Highlight, they have been able to provide their resellers, technical partners, and by extension their customers, with detailed performance data. This not only helps to identify what is working, but also what is not, and that means they can identify and act on the opportunities to improve and upsell — in other words, it helps them to fight commoditisation of IT services, using the Highlight platform. 

    The Highlight platform’s unique graphic driven interface makes it quick and easy to spot problems, and is user friendly right out of the box. Which is important in an industry where constant change and the ability to react immediately are the difference between being the best and being just another service provider. 

    Suggested reading: For more information on the ways Highlight have helped Gamma fight commoditisation, check out our case study — Gamma//Highlight MSP Opportunities 

    Example #3: Visionist uses highlight to visualize government clients’ networks

    Visionist is a little different, in that their IT services are laser focused on government organisations. Their suite of voice, connectivity and mobile services are designed to keep government organisations connected, and in this age of remote work and decentralised operations, that’s never been more important. 

    Seeing as Visionist works with the government, which has been using the reach and flexibility of the cloud for some time, they were using several different monitoring tools to manage and report on performance. But of course, when you try to put several platforms together, something always falls through the cracks. 

    That’s especially true when your team supports over 8,000 government end users at 24 different work sites. 

    Highlight solved this problem for Visionist and their partners and clients, by bringing total management and control onto one easy to use and access platform — this powerful solution helped public IT services to fight commoditisation. This allows teams to quickly and easily identify areas that fall short, and to offer solutions that keep the government’s connections working perfectly — without any dreaded down time. 

    Suggested reading: For more information about Visionist’s journey to combat commoditisation, check out our case study — Visionist doubles visibility and improves management of central government infrastructure with Highlight 

    Highlight can help you too!

    When you are selling the same physical products as the other major players in your industry, it can become a race to the bottom. Price will always be the lowest common denominator, and when everything else is equal, it’s the first thing to drop. 

    Highlight offers telecoms and IT providers and resellers a new way to create value in their offerings and fight IT service commoditisation, by providing them with a platform that allows them to monitor and manage critical communications infrastructure from one easy to use interface. 

    When you can diagnose problem areas before your client is even aware that they exist, and offer insightful solutions that eliminate those problems, you’re already head and shoulders above the rest. 

    So, don’t rely on a patchwork of monitoring solutions or stake your reputation on one size fits all solutions. The future of IT and communications infrastructure is in creating tailored packages that address each customer’s unique needs. 

    Holistic visibility into networks builds trust and differentiates your service offering

    No more bottlenecks. No more overloaded networks. Just smooth, easy results for end users, and the opportunity to offer solutions before anyone even knows there’s a problem. When you switch the focus from the nuts and bolts to the results delivered, you’re not selling an experience anymore. You’re selling seamless communications that keep businesses running and teams talking. 

    Highlight helps companies who deliver those solutions to take the conversation away from the bottom line, and put it back where it belongs: on the value of a business communications system that works perfectly, all the time. 

    But don’t just take our word for it, get in touch today to speak with one of our experts. Join the fight against IT service commoditisation today. 

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