If you are reading this blog, it’s likely that you’re the best managed IT service provider in town, you have the most mature offering, hire and train the best people, and have the best internal processes an MSP can imagine. However, it’s also probable that your sales are just not at the level you want them to be. You are not alone. Even the best MSPs have issues with sales. But underperformance in sales is only one symptom of the problem. The root cause is that your sales are not predictable, and this leads to all sorts of issues. Let's dig into the cause, then see what you can do, then develop a plan to make this happen!
In the good old days, referrals from your clients came in like clockwork. With your client's testimonials, you were able to close 80-90% of the leads you generated. The competition was weak, and it was pretty easy to communicate why your service offering is superior. IT problems were obvious to clients and business owners wanted to solve those visible issues to grow their business.
Over time your potential clients have been increasingly able to solve their visible IT issues. The market is saturated and it’s now very hard to differentiate. Compounding all this is dramatically decreasing opportunities coming from referrals.
This leads to several issues:
Coming in second against "trunk slammers" who win your well-deserved deals by undercutting your prices. It’s frustrating because you know the service quality will be lacking, and the client will be unhappy.
The new website with expensive marketing materials even promoted by paid advertisements did not yield results. Leads are coming in from all over the place but your well-crafted marketing campaigns.
You hired an IT sales expert or inside sales lead generation company, but the calls were unqualified and you couldn’t convey your message, so most conversations didn’t lead to sales.
"Building an MSP is hard enough, and business owners should have a predictable sales process to fuel the company internal process and service developments."
Without a predictable IT sales process, the company has no fuel for growth. It cannot hire new people so that services can be developed and the owner can delegate work. It cannot stay relevant by developing attractive services to new business problems. You can't work both in and on the business to make sure processes are defined and automated, to ensure the company is scalable.
What are the main reasons for IT sales being unpredictable?
I know you want to jump into the solutions, but the major part of solving a problem is understanding the causes. Let's go quickly through the main issues:
1. You want Control but your IT sales is too reactionary
You may have noticed a trend of business owners getting motivated to switching IT providers or replacing internal IT when "SOMETHING" happens. It can be anything. Their IT guy leaves them, their IT provider finally dropped the ball and they’re fed up, or they’ve realized that they have outgrown their provider.
The key is that "SOMETHING" has happened, which leads to the need for a new provider. After this "SOMETHING" has happened, they google the local managed IT service providers, and the IT sales activity starts without delay.
This "SOMETHING" is out of your control. It can’t be triggered by you, but without it none of your MSP marketing and IT sales activities can start effectively generating predictable demand.
That leads you to invest in MSP marketing and IT sales, but with no control over meager demand being generated for your services.
2. You want to solve real problems but prospects look only for "Better IT"
"If I had asked people what they wanted, they would have said faster horses" - Henry Ford
Your prospects are no different. You have been solving root problems they do not even understand need to be addressed. They don’t know why the world needs security policies, an IT roadmap, or moving legacy things to the cloud. They want "better IT", whatever it means. Your sophisticated approach can be intimidating and let them feel "we are not there yet". But eliminating those issues would create "better IT" eventually.
Your "trunk slammer" competition can cater to their needs with deceptive communication. Not that they are bad guys, but they can address the client's needs very inexpensively. Yes, they’re soothing the symptoms, but not curing the disease, because their methods are very cheap. That never actually achieves "better IT" so they keep changing providers, and repeating the trial. That can engender a negative view overall - "IT guys are all the same... they just don’t get it".
That all means you lose deals even though you are the clear choice for the discerning business and were confident at the IT sales meeting that you got this.
3. You want to solve business problems but "they just don't get it"
Remember how IT sales used to be much easier when your value was more obvious and naturally presented? They had slow computers, and you gave them fast computers. They had slow internet, you gave them fast internet. They had devices, cables, and applications all over the place and you uncluttered it. Primarily your solutions were DIRECTLY addressing their obvious tangible pains.
Unfortunately, your other values such as proactive support, IT Roadmap, unified stack, employee education, and security policies don’t perform so DIRECTLY. They have to burn calories to understand why an IT roadmap and a lifecycle management plan lower the cost of their IT investments. They just don’t see any of this as clearly as they understood the faster computer benefits.
Now you’ve become disconnected from most of your prospects. You feel like there are no "ideal" customers out there anymore.
4. You want to Differentiate but the "other IT guys" are all around.
"To a man with a hammer, everything looks like a nail." - Anonymous
Your marketing and sales effort is geared toward the "problems" and "pains" you can solve. And no wonder all your competition promises to solve the same sets of problems. As more providers start up, more people are fishing in your pond. As fewer clients can perceive the less obvious IT problems, the smaller the pond is.
However, there is another pond. A pond which is getting bigger and is still mostly undiscovered. It takes courage to leave the pond everybody is fishing in for an empty pond nobody seems to be interested in.
This pond is full of mature, financially stable companies with leadership teams that have already invested in IT, and have no VISIBLE IT problems. They have their managed IT service provider already and they are happy with it.
However, these companies are suffering different problems that seem unrelated to IT infrastructure, like weak employee productivity, lack of excellent internal communication, the management team lacking proper data in their weekly reports or the need to automate many cumbersome processes. These are NOT VISIBLE IT problems, but you can solve them, and communicate this to generate interest.
Without finding the right pond to fish in, you are lost in the noise and have no chance to differentiate.
5. You feel you got the deal this but the prospect goes dark on you.
The last issue is not something new for you. Engaging with you takes a bold move from your prospects. They need to trust they can give you the keys to their kingdom, they need to invest in their infrastructure, they need to talk to the MSP they’re leaving, exposing them to security risks, they need to face some internal challenges of adopting new processes and come to terms with why they are paying twice what they did before.
The barrier of entry and the switching of costs are enormous for your clients. I know you try to offset this with "free onboarding" or very generous project prices upfront. But this is a fact that the better your services are, and the better your solution stack is, and the higher your maturity is, their switching cost is going to be even higher. The switching cost can be the sole cause that kills your deal.
Without the experience of being a client, they do not understand why they should be a client. It’s a Catch 22.
Without being able to engage them with low-risk, low-switching cost engagements, your competition might steal your deals as the perceived switching costs might be way lower.
What can you do to make your IT sales predictable?
This article is geared toward the realization of the problem rather than the presentation of the solution. But I do not want to leave you hanging without any hint of what can be done. So here it is in a nutshell.
1. Elevate the message
Your IT Infrastructure, Cloud, or even cyber security theme do not provide the necessary differentiation and the leading edge you need.
Your theme has to address the pains and problems of executives, not the subject of your service offering.
Your theme has to be exciting and forward-thinking enough to attract the business owners who have NO VISIBLE IT problems yet.
Your theme has to make your competition puzzled and too scared to even try to copy.
I am not going to spoil anything here, and you know why.... because we do not want to educate your competition, right? More later...
This elevated message helps you to build a marketing and sales funnel that actively attracts your ideal target clients. It makes lead generation more natural and has conversations with prospects without requiring the "SOMETHING" to happen to them to look for providers.
2. Implement a IT Consultative Sales Funnel
IT Consultative Sales Funnel is a very special funnel. It is a thorough, slow, and step-by-step process to educate your prospects and provide value along the way. It is not for the impatient ones. The IT sales process consists of a well-crafted landing page leading to a well-crafted lead generator leading to a well-crafted call to action, then to a well crafted first conversation to a well-crafted consultation meeting and then a well-crafted proposal leading to a well-crafted paid consultation engagement leading to well-crafted processes to expand to ongoing services.
Wow... this is a process of eight different well-crafted things... you might feel overwhelmed. The exciting thing is that as the process is linear, pushing people to the top of the funnel and optimizing the steps to help them get through is pretty simple. Also, it gives you a unique process, and is invisible to your ever-catching-up competition.
3. Kickstart The IT Sales with Specific Campaigns
Your IT consultative sales process has enormous advantages:
It can be applied to any part of the sales funnel. It can be at the top of the funnel for people who don’t yet realize they have problems down to prospects with whom you had some engagement recently and lost a deal.
It can be applied to existing clients as well. As the process has consultative elements, you can perform those events with them for client engagement or even expansion.
It can be a great source of referrals. Not to become a client directly but referrals to get more qualified leads into your IT consultative sales funnel. You can distribute this funnel quickly to your clients and ask referrals for the consulting engagements. (like your consulting sales process has an attractive lead generator, or you have a Workshop of any kind that can be referred to). This can be viral, meaning the leads can be generated automatically based on your IT consultative sales activities. Just like, you may remember, for dropbox.
With only parts of the IT sales funnel ready, you can kickstart campaigns for prospects and clients to start fueling your referral engine.
Plan to make a predictable IT sales funnel
I know this is a lot to take in—many new concepts from the "SOMETHING" to different ponds to fish in and entry barriers. There are many new concepts from fueled referrals and IT consultative sales. I know... this is good news... the more overwhelming this is, the more difficult it’ll be for your cheap competition to emulate.
Also, you might feel this is a "ton of work" you cannot commit to.
But you have a choice to make. To step back now or to push this further. Ignore the opportunity or move and learn more. If you are the brave type, if you are like the cutting edge, if you are thinking forward, you know this is worth exploring further. We know you need a plan to put this together and have a process to implement the ideas.
A blog can’t cover it all, and we wanted to do more...
We created a 7 Day Video Series to go into the details. Why 7 days? Because you can leverage a 5 Step Framework and a 2 Step Implementation Process. We want to give you time to digest all steps separately and let the different action items sink in. It will provide you with a quick but comprehensive look at the actions that need to be taken for predictable sales.
Why did we do that? We believe that MSP owners have been working too much too hard on their business and deserve more predictability. One thing that seems out of control for you is sales. We want to help solve this problem so you can predictably grow your business. You can provide predictability for your employees and their families and get rid of the anxiety of being unable to control your business's primary source of fuel: new clients.