How to reinvent MSP sales strategies
Peter Savereux | 20/01/2021
2020 changed business as usual across the economy. It’s important to regularly reassess how your organisation operates. However, heading into 2021, there has never been a better time to really rethink how core business functions operate. Improving sales strategies is an essential piece of a more sustainable “new normal” for MSPs.
A creeping challenge that network and managed service providers have faced for years is commoditisation. As technology improves, quality gets taken for granted. But for many MSPs, their sales strategies simply have not been updated. It’s far too common to focus on performance, price-points and modularity — all of which exacerbate price comparison and commoditised thinking on behalf of customers. The result is continued pressure on margins and stagnant profitability.
66% of MSPs plan on expanding their service and product offering as part of a post-COVID strategy. Most businesses (customers) have needed to update their network technology in order to accommodate remote working, and are now more dependent on network services than ever before.
At Highlight, we’ve been working with service providers for more than two decades to build the strategies and technology needed to deliver a different and differentiated outcome. There is a better way. 2021 is the year to reimagine the MSP sales process, and this article will explain how. Let’s get started.
Step 1: Sell an outcome — not a “box of bits”
The central change that MSPs need to make is a shift towards outcomes. Rather than selling a “box of bit” that focuses on features, capabilities and modularity (something that exacerbates commoditisation), you need to focus on interconnected outcomes that can’t be pulled apart and price compared on a piece-by-piece basis.
Customers work with MSPs because they want to avoid the technical side of IT services. Outcome selling leans into this and adopts a customer-based mindset. You need to:
- Identify your target customers
- Understand their needs and goals
- Know how your product can benefit the customer
- Show the customer exactly how they can achieve their desired outcomes.
Critical to creating an experience selling connectivity is selling a “service”. You aren’t just selling the hardware or software; you are selling the installation, rollout, maintenance, growth and engagement of that infrastructure. You need to provide customer-facing tools that improve how you present network insights to your customers and how customers review outcomes internally.
Ultimately, this boils down to a positive customer experience. That means flawless delivery, predictable and controllable costs, easy growth and a trusted partnership. You then need to create ways to demonstrate how you will deliver these outcomes during the sales process.
Step 2: Demonstrate what it’s like to be your customer
A big puzzle piece of effectively selling an outcome is your ability to demonstrate those outcomes during the sales process. A long-term focus for us has been helping MSPs better understand customer data, and then use that information to improve customer communication. A byproduct of this was a powerful sales tool. There are two components to this provided by Highlight that are critical to demonstrating value during sales:
- Shared access to a cloud-based platform
- The ability to quote using real numbers
Highlight takes technical network data and presents it in a way that can be understood by business-level professionals. It provides your teams and customers with shared access to a cloud-based platform, and unique logins provide individual access to only the right information. Your ability to quickly deploy this platform to conduct a network audit not only allows you to quote using real numbers, but it also lets you use the customer portal to review that information with prospects.
The critical point is that using customer communication tools (especially ones that are non-technical and business-friendly) during the sales process directly demonstrates what it’s like to be your customers. If these tools provide differentiating value to the customer, that will stand out during the sales process.
Insights vs data
A critical part of making information business-friendly, and relevant to commercial outcomes is the difference between data and insights. Customers want relevance, clarity and context. This is also what your sales teams need to actually put data to use within a sales context.
Most engineering tools (and traditional monitoring software) can’t deliver outcomes within a sales context because they overload with de-contextualised information. This comes down to critical distinctions regarding data, analytics and insights.
- Data: This is the raw and unprocessed form of the information you collect. It might not offer any value to your customers when shared as it is.
- Analysis: Once you collect the data, you need to inspect, clean, and model it to mine for valuable insights, which are crucial in decision making and driving actions.
- Insights: These are the knowledge you gain after analysing your data. They provide context on your data, allowing you to take actions and drive outcomes.
Insights are what drive positive conversations, allow you to take effective action based on information, and use it in a commercial context. We built Highlight to focus users on insights, but it’s an important factor to keep in mind in any context.
The benefit of quoting using real numbers
Real numbers allow you to give projections, provide context, and show value to your prospects. Often, new business deals are driven by customer estimates — estimates that are not always correct. Accurate data not only allows you to demonstrate your ability to capture and communicate technical details effectively, it might let you significantly undercut the competition.
If the customer has overestimated their demand, you will be able to quote a lower figure than your competitors. If the customer has underestimated demand, you will be able to substantiate why your quote is what it is. Fundamentally, you are able to provide value-added advice during the sales process, while demonstrating what it’s like to be your customer.
Step 3: Become part of “the IT team” and upsell
Increasingly, the line between service providers and in-house IT is blurring. In-house teams are expected to deliver services internally against SLAs and within budget, and service providers are expected to provide assistance and act as a more cohesive part of the organisation.
This is a trend that brings advantages to MSPs with the right toolset. Not only does this create opportunities to “sell a service” — like we addressed in the first step — it makes it far easier to upsell long term. Remember, closing a deal doesn’t signify the end of the sales process.
As you nurture stellar relationships, you should invest in discovering upselling and cross-selling opportunities, which are often more profitable than customer acquisition. You’re 60-70% more likely to sell to existing customers than to new customers, and it’s 5 to 25 times more expensive to acquire new customers than retaining your existing ones.
Again, this comes back to having the right tools that can deliver relevant (non-technical) insights to sales teams and commercial teams — helping you use network data to find these opportunities and communicate them to customers.
The right technology is key
Insights have become invaluable in making critical business decisions. Your sales team needs these insights in leads prospecting and nurturing as well as closing deals. Gaining such insights is only possible through leveraging effective technology in your everyday operations.
Consumer-facing technology has also become increasingly important in today’s “new normal,” allowing you to use data to communicate with customers and prospects effectively. Providing customers with effective and differentiated tools is also part of what will allow you to embed within their team, and sell an outcome-orientated service. Customers want to see how you can deliver the results they want, and technology allows you to do that.
You should take 2021 as an opportunity to put your business on the growth path by investing in the right technology. Highlight provides easy access to valuable insights, which allows you to engage with customers at a holistic level, improve customer retention, and increase upselling and cross-selling opportunities. It’s also a customer-facing tool that will allow you to more effectively engage as part of the team.
We’ve spent the last 20 years working with managed IT services to solve different sales problems and have built software specifically to help MSPs achieve commercial growth. Everything here is the background of what we want to help you achieve. Get in touch with our team today if you have any questions.