The growing SaaS and Cloud trends are making the IT services market more competitive. In some spaces, like UCaaS or cybersecurity, where there used to be three or four major players, there are now literally dozens of them. Most of the vendors claim to sell through MSP partners and agent channels, but many still keep their direct sales groups active in the market.
These changes push MSPs to be more aggressive with their sales, although we see the trend of losing more deals than winning them among our MSP partners. What causes this situation and how can an MSP fix it?
The trend we’ve discovered
The foremost strength of the MSP business is trusted long-term relationships with the customers. Having these relationships makes many MSPs feel protected from the competition and therefore less alert about it. Whenever they have a request from the customer for a new SaaS solution, their sales process looks pretty much like this:
- Discovery call
- Demonstration of one or two of the most attractive solutions
- Proposal or quote
After this, the sales rep waits—sometimes for weeks—for the customer’s response without pushing for the deal closure.
MSPs could afford such relaxed upsell just five years ago, but today it may seriously harm their business. With the amount of competition and enormous number of available solutions on the market, the customers are being bombarded with promotions every day, putting the MSP’s initial proposal further and further down the list. If you let the deal sit for two weeks without proactively following up, it’s almost certain that you’ll lose to the competitor that made the most recent offer to the customer.
Changing the mode
To avoid losing new business or existing customers to a competitor, MSPs should switch to an always-be-closing mode. Here are some suggestions we found effective to help MSPs increase and retain their customer base:
- To prevent another vendor from bringing a competing solution, let your customer or prospect know that you offer more than one solution in their space of interest. Choose at least two best-fit solutions for the prospect and demonstrate them within the same week. Partnering with a Master Solutions Provider like LANtelligence is ideal for such situations.
- Find out when the prospect is planning to install the solution. Push for signing the contract as soon as possible, even if the installation is planned for a few months from now.
- Don’t let the deal sit without a follow-up for longer than a week. Consider assigning the task of proactively following up with a prospect to non-technical representatives rather than engineers.
Follow these simple recommendations to avoid losing the cloud deals to an ever-growing pool of competition.