MPS4MSPs: Networking Eats Marketing for Lunch

MPS4MSPs–Marketing Professional Services for Managed Service Providers–is a recurring feature here in The Business Technologist’s Journal focusing on how MSPs promote their practice most effectively.

A CEO I worked closely with many years ago had an interesting weekly ritual of printing out his entire contacts list. He would then work his way through the entire list, calling people and then crossing them off that print when he had.

I never found out, or figured out, how he selected who he would call, but I did notice the pile of past prints sitting on his credenza, which I assumed was for him to look back and see who he hadn’t called recently.

He had been a very successful salesman of computer-related supplies and products earlier in his career, and when the personal computer was introduced, he started his own company to sell them. When I asked about his calling ritual, he explained that it had served him well when he was a salesman and still served him well driving sales for our company.

The Four Things You Need

In his signature book, “The Well-Fed Freelancer,” author Peter Bowerman explains there are four things one needs to be a successful freelance writer:

1)     You need to have an industry you know well

2)     You need to know many people in that industry who could become or refer clients to you

3)     You need the ability to sell and market yourself

4)     It would help if you could write fairly well

Yes, this is the book that transitioned me from 35 years as a channel executive to become a freelancer who writes for and about the IT channel. My answers to these four questions convinced me to cross that chasm.

1)     I knew the tech industry very well after three and a half decades.

2)     I had always pinned my success on knowing who to turn to for help with any given issue, and I realized how many thousands of people I knew in our business.

3)     I spent most of my career promoting and selling the skills of others, so selling my own services should be even easier.

4)     You be the judge of the writing.

The Channel Changes

Some of you may have read or even followed my earlier column in Redmond Channel Partner magazine, “The Changing Channel” which charted the constant growth and change of our industry. The arrival of cloud computing was a great advance, but it dramatically reduced the demand for the purchase of servers, storage, and other high-priced equipment. Many resellers eventually closed their doors.

Others focused instead on developing the services they delivered to customers, trained their people on new technology skills, hired skilled people, developed methodologies, and recreated themselves as managed service providers (MSP). The channel had changed.

Today my column is called “The Evolving MSP” and one of the ways in which it has had to evolve has been in the way MSPs go to market.

Two Roads Diverged – The New MSP Go-to-Market Reality

Many vendor channel managers often complained that their channel partners were poor marketers. When the channel was all about reselling their products, their frustration was that partners weren’t promoting their specific products effectively.

They had completely missed the point.

Channel partners were happy to promote vendors’ products, but promoting their own services was even more important to them. When the channel shifted from product-first to services-first, this challenge became even more pronounced. The go-to-market (GTM) strategy for MSPs had to effectively promote their services to an ever-expanding audience of prospective customers.

The Shift from Volume to Value

When selling vendors’ products, volume is the key metric of success. When resellers were pushing their vendor-partners’ products, they too sought higher volumes of sales.

Now, however, they were pulling those products through when needed as components of the solution projects they were selling. In essence, the sale of vendors’ products became dependent upon the MSP’s success in selling their services. This reunited the interests of the vendor and the channel partner on the other side of the equation. Instead of both benefiting from product sales, both would benefit whenever the MSP’s services were sold. The strategy had shifted from a focus on volume to a focus on the value of MSP services.

The marketing firms serving the IT channel couldn’t see this shift. They continued to encourage MSPs to go-to-market the same way they had when they were resellers. That no longer worked, and the MSPs felt that at their bottom line.

People Buy from People They Like!

Often, the only person resellers dealt with at their customers’ companies was a purchasing agent. That contact didn’t generate demand, they simply fulfilled it for line-of-business managers. Their priority was simply to obtain the fastest delivery at the best possible price.

In the new MSP world, those line-of-business managers became the key decision makers, and their criteria were anything but price and delivery. These decision-makers needed to gauge the effectiveness of the services they were looking to obtain. They had to evaluate the professional skills and conducts of candidate provider companies and compare them to identify the right one. They looked at track record for excellent service delivery, reputation, and trustworthiness.

Unlike price and delivery, all of these new criteria were subjective. As such, they were impacted by far more emotional observations and evaluations. One of the most important dimensions of the selection process was the “fit” between provider and customer. Did they feel good about the MSP they were interviewing? Did they feel they were trustworthy? Did they inspire confidence? Could their company and this MSP truly get along well with each other?

This is literally no different from the experience of other professionals, such as lawyers and accountants. There was no advertising collateral, no “leave-behinds” or other documentation that accelerated the decision process. The people making the decision needed to feel good about the people they were choosing to work with.

The Most Valuable Reward for any Sale

Ask any group of IT sales professionals what the most valuable reward for any sale is and they’ll very likely say, “the commission!” And they would be wrong.

When a customer is truly satisfied with your work, the most valuable way they can reward you is to refer you to their friends and associates. This literally multiplies your success and earns you far more in commissions and profits. And when you meet a new prospect through a referral the process of earning their trust and confidence is accelerated by the fact that someone they know and trust has assured them of your quality.

Many years ago, there was a television commercial suggesting that someone who enjoyed their experience of the advertiser’s product would tell five people, and they would tell five people, and so on, and so on. This phenomenon applies even more powerfully in the sale of professional and managed services than anywhere else. What the customer is buying has its foundation in the quality of you and your people. Your professionalism. Your conduct. Your commitment to their success.

This is the new go-to-market strategy for successful MSPs. Not marketing as much as networking. Connecting to new people through the people you’ve already pleased. Expanding constantly as the new people you’ve met become satisfied and introduce you to even more people. And those people introduce you to more people. And so on, and so on.

So, What Do We Do Next?

How do you put the power of networking to work for yourself immediately? The answer is simpler than you might imagine.

My former CEO had the right idea. Reaching out to people, strengthening the relationship you have with them through conversation, and paying attention to them is a great start. Beyond being friendly and enjoying conversations, your objective is to always keep yourself in their front-of-mind. After you’ve asked them how things are going for them, you have the opportunity to talk about what you’ve been doing lately. You don’t have to even ask them for anything. When they encounter another contact who has need for your services, it is very likely they will suggest they contact you. This gets amplified when you politely and enthusiastically thank them for the referral.

Early in my writing career I had several projects all end at about the same time, and I had made the mistake of being too busy to properly keep in touch with everyone. I realized that my income stream had diminished to almost nil. It was a bracing moment of learning.

The next morning, I picked up the phone and started calling people. Not to ask for work, but simply to catch up with them and keep them updated on what I was doing. The calls consumed my days and within a few weeks my workload was enormous again. This time, however, I booked time in every day for reaching out to people and have never experienced a similar drop in business.

Final Thought

It is said that it is more blessed to give than to receive. When you stop to think about it, that makes tremendous sense. When you receive something, you’re happy and grateful. But when you give something, you feel great about yourself for being giving and caring. People feel best when they get to give something to someone.

My personal postscript on every message I send is “The more good you do for more people, the more good finds its way back around to you.” I have found this to consistently be true, and it has encouraged me to always be looking for ways to do good for others.

The “payback” for this is astounding, encouraging, and inspiring. I have been writing for and about the IT channel for 15 years now, and I continue to benefit from the wonderful network of friends I have developed over the years. I suppose that the social media posting of anything of mine that is published constitutes marketing, but it is the networking with people that has consistently grown my business. It will for you as well if you continue to constantly work on developing your network.

The network works.