What is the ultimate MSP differentiator? Trust. But what does that look like?

It’s no secret that the last decade has seen a massive increase in the commoditisation of IT services. As a result, managed service providers (MSP) need to work harder than ever to separate themselves from the pack, but what do MSP differentiators look like?

Moving far beyond simply valuable, IT services are the foundation of nearly every business and sector. With its value firmly established, the number of companies providing such services has drastically increased, resulting in a price-centric race to the bottom.

However, there is a way to combat this… Trust. If your customers really trust that your company is providing a service that goes above and beyond what other providers offer, then that service becomes unique again and ceases to be a commodity.

The question is, what does that trust look like?

Why do you need to adopt MSP Differentiators?

As a result of a greater global emphasis on digital transformation, and the constant pace of technological evolution, many new companies have sprung up, bringing new MSP offerings to market. So we are left with a combination of a rapidly overcrowding market and a customer base whose priority is often cost reduction.

In the face of these drivers, MSPs typically no longer possess a unique proposition and the commoditisation of IT services has resulted in continuous pressure to invest in processes that deliver more value to customers while keeping costs competitive — and, as we all know too well, customers often base their purchasing decisions based solely on price and availability.

As will all commoditised markets, this inevitably leads to increased customer churn, as customers are constantly seeking the lowest price which in turn leads to reduced profit margins. A lack of a consistent customer base also reduces upselling opportunities, with existing customers 50% more likely to accept an upsell than new customers, further reducing margins.¹

Constant attempts to attract new customers with increasingly niche services or products often results in disjointed service offerings, further reducing customer satisfaction and increasing churn.

That question is, what can MSPs do to combat this trend and differentiate themselves from their competitors?

The secret to MSP differentiation is trust:

It’s a bit of a tired trope that there is a chain coffee shop every five feet on most modern high streets. Which begs the question, how do independent coffee shops still exist in the face of this overwhelming commoditisation? The answer is trust (which breeds loyalty).

You can go to any of the major chains and expect a certain level of value because you know you can go elsewhere to get it if not. However, you will go out of your way to get to an independent coffee shop that you trust will deliver you additional value.

A little more care over the temperature of your latte, comfier seating, the ability to choose the music playing. Whatever it is, you know they’ve got the extra mile to make you satisfied and you’ll consistently choose them over a chain store because of that trust.

The same is true of IT services and effective MSP differentiators (even though we’re aware a mocha latte is entirely different from a complex managed service offering). Creating a service that your customers trust innately will deliver value above all else, and crucially, it will decommodify your offering, rendering it unique again and making it stand out from the crowd.

But how do you build that trust?

Practical ways to increase client trust

In order to evade the pitfalls of IT service commoditisation, implement this four-pillar approach to instil complete trust in your customer that the services offered by MSPs are unique in their ability to deliver consistent value above all else. These four pillars include:

1. Understanding:

Offering an end-to-end holistic solution is paramount to an MSP differencing their offering from a crowded market. An accurate understanding of customer systems allows service providers to intimately understand what’s working, what isn’t and how to fix issues before they have a business impact.

Innate knowledge of their customer’s systems allows MSPs to become a single unified solution to their customers’ needs, rather than just another partial fix.

Tips to boost client understanding:

Consider incorporating the following features to your service offering:

• Sophisticated and relevent analytics: Capturing only the right information is vital to demonstrating competence and value to your customers. What’s more, if you’re only collecting data relevant to your clients’ performance issues or goals, you’ll save time analysing that which is redundant and be able to focus efforts more on the correct information.
• Historical performance reporting: The past informs the future, particularly for MSPs from a capacity, usage and service type perspective — so, ensure you keep a record of your clients’ previous network performance as it will inform how you understand their network futures.

2. Transparency:

Transparency is normally the foundation of trust, so being able to share network visibility with your customers is critical.

Highlight allows a service business to share that visibility with their clients, building trust by allowing them to hold the MSP accountable.

Tips to increase transparency:

Consider implementing the following changes to your service offering:

• Total and mutual visibility: When your clients can see into their own network performance to the same granularity as you can, it sends them a message of confidence and honesty, insofar as you are so assured by the value of your service that you have nothing to hide! How could they not trust you?
• Create custom views: If your clients have to sift through mounds of information that is irrelevant to them, that doesn’t scream ‘valuable service’ — offer dashboards that stratify information based on the end-users’ intention.
• Simple, centralised presentation: Try to keep all reporting, communication and network tracking in one place, this demonstrates that you care about the end-user experiences and ultimately, shows you care about what your clients are doing, not just about their premium.

3. Proactive management:

Through the use of the Highlight platform’s automated alerts to draw attention to service speed drops and excessive use alerts, providers of managed services spot issues, highlight them to customers and solve them before they cause downtime, demonstrating their value and building trust through honesty.

Tips to be a proactive service manager:

Consider implementing the following changes to your service offering:

• Predictable and controllable costs: No one likes an unexpected bill, especially when you can prevent the surprise. Through cost control and projection features you can eradicate bill-shock and generate even more reasons for your clients to value your service.
• Proactive status reports: Provide your clients with preemptive status reports, speed performance updates, capacity alerts and usage tracking to give them more insight into their network. For example, if they’re likely to exceed capacity at a crucial time for their business (i.e. retail business at Christmas) then you can warn them in advance to avoid downtime.
• Predictive maintenance: Maintenance is not a riveting task, so you shouldn’t rely on your clients to raise issues with you in their systems — rather work predictively and proactively to resolve issues before they come. BUT remember you need to let them know you’re changing something before you do it!

4. Cohesion:

The enhanced communication offered by the Highlight platform allows MSPs to always be there to provide a solution, fully integrating with their customers to provide the kind of total cohesion and seamless partnerships that set them apart from the competition.

Tips to cultivate cohesion:

Consider implementing the following changes to your service offering:

• Value-added advice: Be more than a provider, be a partner. If you make consultative advice part of your service offering and provision then you can boost your overall margins by ensuring that the value of networks is constantly being reviewed.
• Simple and straightforward service evolution: Upselling becomes much easier when clients trust you have their interests at heart. Provide evidentiary research with each upsell and expansion recommendation — this way growth is trusted as necessary and seamless for both parties.

Highlight helps you build trust

Building the trust in your customers that the service you provide is uniquely valuable is both vital and not an easy proposition. But, fear not, the Highlight platform offers a range of critical paths to the adoption of MSP differentiators that build trust. How do we do that?

Embedding you in their team:

The Highlight platform helps to remove the barrier between you and your customers and build trust through visibility and transparency.

Through the use of customer-facing dashboards and easy to understand data visualisation tools, Highlight allows you to express the value you bring to your customers, providing a critical differentiator in the customer experience. A full suite of notifications and alerts allow you to conduct proactive maintenance, avoiding customer downtime and improving adherence to service level agreements (SLAs). Accepting accountability for any errors increases customer trust in the value your service brings and enhances customer loyalty.

Offering holistic IT services:

Having full end-to-end (and mutual) visibility over customer systems provides valuable, actionable insights that result in improved performance and customer experience. The Highlight platform uses data capturing tools combined with advanced analytics to provide actionable insights, rather than just contextless raw data. This, in turn, provides unparalleled visibility into customer networks and allows MSPs to provide a single centralised holistic solution that covers all of their customer’s needs.

Cultivating more positive relationships:

The data gathered by Highlight can actively extend the range of business options available to MSP, allowing them to offer consultation services or full IT stack management options. At the same time, sharable dashboards and visualisations make it far easier to demonstrate the value of products and services, leading to more meaningful conversations with customers, greater upselling opportunities and continuous improvement to the customer journey.

Building meaningful relationships with customers is the first and most important step in creating that kind of trust that sets your service apart from the competition in an increasingly crowded and commodified marketplace. In turn, that trust reduces churn, promotes customer loyalty, positively impacts margins and leads to greater business opportunities.

To find out more about how Highlight can help differentiate you from the rest of your competition, arrange a call with us today!

 

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¹How Service Providers Can Re-Imagine Sales Enablement in 2021