Guide to Selling Managed Services in 2020
Guide to Selling Managed Services in 2020
Although the managed services industry is in a steady growth phase, most managed service providers (MSPs) still struggle when it comes to selling their services. If you are an MSP trying to position yourself in a competitive market, proper software tools and high-quality customer service are non-negotiable. However, selling managed services takes a lot more than that.
In this blog, we’ll break down the complex process of how to sell managed services to various small and medium-sized businesses and how to incorporate various strategies when pitching your services to potential clients.
Best Ways to Overcome Most Common Selling Challenges for MSPs
While numerous challenges exist in selling managed services to businesses, it certainly isn’t difficult to overcome these challenges and succeed in this industry. Even in a crowded market, MSPs can take advantage of a myriad of opportunities to sell their services profitably and boost their growth.
Some of the key steps to overcoming these challenges are:
- Address the pain point: Focus on the specific challenges your potential client is facing with IT. Explain how your service can ease their burden and make life better for them. For instance, if your potential client is struggling with data management, you need to pitch your cloud storage service and show how it can reduce their data storage and maintenance costs.
- Invest in technology: Most SMBs are now aware that they can compete effectively, even with large corporations, if they have access to the right technology. They expect MSPs to have the latest solutions available in the market, which means MSPs need to constantly upgrade their software products by investing in technology and choosing the right tools for their business.
- Educate your customers: SMBs that do not have a background in technology often find it difficult to understand why they require MSP services and why that should be a part of their yearly budget. Educating your customers should be a part of your ongoing sales strategy in the MSP world.
- Create demand with a strong marketing campaign: If you want to capitalize on the current growth phase the MSP industry is going through, you need to start attracting valuable clients through a strong marketing campaign. You need to build a buyer persona to specifically target the right customers who can add value to your business. Your campaign should focus on what services you provide and how you can maximize the ROI of your clients. You need to use a combination of different methods like emails, Google Ads, SEO and more to reach a wide range of target customers.
- Price your services right: You need to price your services right based on the value you provide rather than the costs you incur. You need to research the prices charged by your competition in the market and how much your typical target customer can afford. Based on that, you can come up with a fair pricing strategy that can help you stay competitive in the market. Make sure to read our free eBook: Pricing for Profitability for MSPs to help you form the right pricing strategy.
Questions to ask a prospective buyer
One of the most important aspects of selling managed services involves asking the right questions to your target customers. Apart from building relationships, this will also help you develop your pitch based on what they need from their IT service providers.
Ask the following pertinent questions:
- What are the IT issues your prospects face?
- Do they have any specific concerns over cybersecurity?
- Do they have pain points that need immediate fixing?
- How much are they willing to spend on IT?
- What level of service do they expect from you?
Once you figure out the answers to these questions, you will be better positioned to suggest the right package that addresses all their needs.
Tips to Become Successful at Selling Managed Services
Considering the steady growth of the overall managed services market, this is the right time for you, as an MSP, to capitalize on this trend and grow your business. However, if you are struggling with growth, these tips can help you:
- Cross-sell and upsell: Cross-selling and upselling presents a great opportunity for MSPs to increase their revenue and profits. It is much easier and cheaper to sell to your existing customers than to acquire new customers. You must find a way to pitch new services to your existing customers. Apart from increasing your revenue, this also helps with customer retention.
- Partner up with right players: There is a wide array of managed services available in the market. In most cases, MSPs won’t be able to provide everything on their own. Partnerships are important to take your business to the next level. For instance, if your expertise lies in security solutions, you could use a partner to provide cloud backup for your clients. In return, you could also pitch your security solutions to the clients of your partner. When looking to collaborate, you need to align with a partner that complements your business.
- Handle objections well: Objections are part of the game when pitching your services to potential clients. You need to be prepared to handle these objections and exhibit confidence in your approach. Every objection can throw light on what information you’re possibly lacking in and what information you need to have. This will help you approach subsequent clients with the right information so you can move ahead with the sales process.
- Approach the decision-maker: While this might seem like common sense, there are times when salespeople waste their best efforts trying to convince someone who isn’t even in charge. You do not want to hear, “I need to check with my boss” when you finish your pitch. Make sure you always speak to the decision-maker when pitching your sale. Do your background research on who can help you close the sale.
Selling your managed services does not have to be hard. By following the tips mentioned above, you can unlock your potential and position yourself as a dominant player in the market. Focus on efficiency and choosing the right strategy and software that fits your business objectives best. Good luck!