Providing an essential service to businesses might seem like a safe bet, but over time prices drop, margins shrink and low-cost players can convert a growth industry to a commodity.
Look at telecommunication firms; in their quest to avoid being a “dumb pipe” they offer a host of complementary and ancillary services and solutions beyond base connectivity.
There are multiple reasons they adopt these strategies.
Transitioning from vendor to partner
Providing a single service or set of services to a client usually means your relationship will remain a largely transactional one.
When they need more cloud storage or processing power you’re obviously the company they will turn to, but your firm may not be top of mind when it comes to higher-level strategic decision making.
By providing an assortment of services that span beyond basic managed services, your company’s reputation within the client evolves to that of a trusted solutions provider.
This creates opportunity to expand the breadth and depth of client engagements and might lead to direct additional business engagements vs. competing for new RFPs against other providers.
Increasing personal connections
As a vendor providing a very specific solution, your company is unlikely to have many contacts within client organizations.
Beyond IT, your staff may have little-to-zero contact with any decision makers, depriving your team of business development opportunities and chances to add real and unique value to your clients.
An expanded services offering puts your team in contact with far more departments and stakeholders.
As executives in marketing, engineering and other departments are exposed to what you have to offer and the breadth and quality of your expertise, the chances of a deeper and more profitable engagement increase exponentially.
Amplifying switching costs
The more touch points you have with customers, the harder it is for them to switch to another provider.
They’ll likely have to move their business to multiple vendors to replace the services they’re getting just from you, which significantly complicates that transition and makes it less appealing to bother with.
When you’re only providing a specific, narrow set of services, there’s little incentive for customers to remain loyal vs. chasing a lower price or introductory offer.
If you’ve ingratiated yourself with multiple parts of the organization, the complicated logistics of breaking up make inertia your ally.
Convinced your firm should avoid becoming a commoditized service provider by diversifying its offering?
If so, here are some of the opportunities where MSPs can broaden their relationships with clients while still delivering their core value.
Businesses need dozens of systems to run effectively, but they’re rarely in a position to independently determine which vendor is the best fit for their particular needs.
That’s where an MSP can add additional value.
Your team is already experienced in interviewing customers to understand their specific requirements and future demands when it comes to cloud computing solutions, and those same skills can be applied to a host of other areas.
Speaking to the various stakeholders at specific clients and making solid recommendations on which solution best fits their business, technical and budgetary requirements is a huge benefit for your clients and advances your trusted advisor relationship to the next level.
Domains to focus on include marketing automation, CRM, accounting, HR/payroll, logistics and customer service.
Each of these business functions have multiple types of software solutions addressing their needs sold by a myriad of vendors.
Narrowing these down to a few recommendations with specific pricing and configurations will be valued by clients and provide several other opportunities for your business.
In some cases, your company can also become a reseller, sales agent or ISV for these other business process solutions, which has obvious revenue generating implications.
Of course, if you only rep one CRM solution, for example, your clients might see your recommendations as biased, but that may not prevent them from engaging if it’s a solution that fits their needs.
Training and education services
Similar to getting clients up and running on new systems, your firm has the opportunity to train client staff on how to make the most of their newly licensed solutions (including your core offerings).
This training can focus on the primary functionality as well as some of the ancillary features that many cloud solutions include.
Not only does the training itself represent an opportunity to make more money, but ensuring your clients fully realize the value of the products their licensing increases the odds of renewal and growth.
You won’t know until you ask
While the above suggestions are great places to start to expand your client relationships, the most important step you can take in growing your offerings is to engage with client stakeholders on a regular basis, not just when you’re trying to sell them something or secure a renewal.
Asking clients more general questions about their business, the challenges they’re facing and the opportunities they’re seeking can unearth new opportunities for your firm’s expertise to add value simply by listening.
Kirill Bensonoff is a seasoned entrepreneur and the founder of Unigma (by Kaseya), a unified cloud management platform. Kirill blogs regularly about cloud, tech and growing your managed services business. He can be reached at [email protected].