The Frugal Networker

At the recent (March 26 and 27, 2015) MSPWorld keynote, Charles Weaver, CEO of MSPAlliance (The International Association of Cloud and Managed Service Providers, established 2000), discussed how alliance members should beef up their marketing efforts. And if the CEO of the MSPAlliance recognizes that there’s a gap, there’s clearly a gap in getting the word out to potential customers about their services. Traditionally marketing to potential customers meant direct mail, targeted campaigns, cold calling, email distribution lists, billboard ads, referrals, magazine ads, and online ads; but MSPs have found that generally speaking most of these methods are ineffectual. Historically MSPs have mostly relied on word-of-mouth referrals to bring new customers into the fold.

What does work for MSPs in getting the word out about their services?

Of the many different marketing strategies, referrals, blogs, email marketing, Requests for Proposals (RFPs), and cross selling offer the best returns to MSPs. Although referrals are very good in converting connections into sales, the number of them is very low. For an MSP to be successful, it has to launch a multi-front marketing campaign.

Referrals

Referrals from current customers seems to be the number one method of attracting new business for MSPs. The reason that MSPs hold referrals in such high regard is that this type of business prospecting has a high rate of return and has a very low cost to the MSP in terms of financial outlay and time required for the sales process.

Making a referral network work is a fairly easy task. Ask your customers if they could refer your services to at least one company in their customer base or within their sphere of influence. As your network grows through referrals, continue to ask for referrals from each new customer.

However effective, this type of organic growth is slow and requires some relationship nurturing to assist and to fuel the process.

Blogs

Blogs, especially guest posts in a corporate blog by customers, are effective in increasing customer base. Potential customers can read about how other companies have solved similar problems using your services and expertise. That gives the reader an immediate connection to your business and your solutions that can help them.

Sphere of Influence – a business network where companies or their officers or principals have some expressed or implied influence over others because of mutual trust, a working relationship, a partnership, or out of respect between the parties.

What you don’t want a blog to be is a pure sales pitch or a marketing tool. You want to be sure to inform and educate your reader about how your services have increased sales, streamlined processes, made it easier to buy, increased customer service, or boosted profits.

Make your blog entries about the customer and not about you. Provide real data and real customer testimonials where possible. Numbers speak louder than marketing fluff. Keep posts concise by telling a compelling story in 750 words or fewer. Post new blog entry URLs to all social media outlets to gain a diverse readership.

Email Marketing

Email distribution lists, whether created from correspondences or acquired by rental from a list broker are often a good source of prospective customers. The return rate is typically not what one would expect from such a contemporary medium. The rate of conversion is even lower. Expected rates of return are in the single digits and conversion rates are in the single digits of those returns.

The upside to email marketing is that it’s inexpensive, even if you rent or buy lists. It’s also an excellent method of getting your name in front of a lot of business influencers whether or not they buy anything from you. It often takes several iterations of a message to receive one positive return.

Rather than creating generic email messages touting your products, it’s often more effective to create a newsletter and distribute it via those lists. Newsletters aren’t seen as spam and potential customers read them with enthusiasm. To make your newsletters a welcome Inbox addition, include industry news, links to your blog entries, and information about your company and its services. Don’t make it to “salesy.” You want people to see it as having value and not just as an opportunity to deliver unwanted pitches for your services.

Optionally you can setup an opt-in/opt-out mailing list for your customers or website visitors.

Requests for Proposals

Requests for Proposals (RFPs) can be used to acquire new business by entering into competitive bid situations. RFPs often require some moderate amount of effort to create a sale because of the bidding process and submission of detailed information about your company, its leadership, its capabilities, delivery times, Service Level Agreements, and related information.

Sometimes the bidding process is lengthy (months), but the dollar amounts are also higher for these types of agreements.

Cross Selling

Cross selling is one of the most effective methods of gaining new business for MSPs. It involves selling additional services to existing customers or entering into cross promotional agreements with other vendors. Cross selling is a low cost marketing method because you’re selling to a customer who’s already bought into your services. Return on investment is very high.

Cross selling deepens the vendor-customer relationship and builds loyalty for both parties.

Social Media

Although relatively new to the marketing scene, social media selling has become one of the hottest new marketing strategies for all businesses. MSPs can ride this wave by engaging its current and its potential customers in conversations via social media. Feedback, ratings, and testimonials are all very powerful drivers of new business.

Tweet blog post URLs, post to your Facebook page often, ask for guest posts on your blog and Facebook page, engage your customers via LinkedIn, post your blog URLs to LinkedIn, and to all LinkedIn groups of which you’re a member. You have to use social media to your advantage. Check in when you’re out to lunch with a customer and tag him or her on Facebook to let everyone know that you’re entertaining a customer.

Start a conversation on Twitter with your customers. The easiest way to start a conversation is to ask a question. Gain followers by using relevant hashtags and posting often to all of your social media sites. Follow all of your customers and their customers. Follow influencers, thought leaders, and technology journalists.

Media

Use media connections and technology journalists to your advantage by scheduling interviews to be posted on their outlet sites. Use social media to promote those posts once their published. Public Relations and brand marketing firms can help you connect with the correct people for your business.

Upstream Partnerships

Your upstream partners can also send a steady flow of traffic to your site and to your attention. Your upstream partner should give you qualified leads that will help expand and extend your business. A good partner will offer you training, significant hardware and software discounts, marketing assistance, and some visibility as to who your customer base is. Leverage your partner’s resources to grow your business. Remember that a partnership works in both directions. The more you engage your partner, the more your partner will engage you and your business.

If you’re an MSP that offers top notch services to your customers, you need to get the word out. First, start in your network by asking for those referrals and then expand by putting some simple, time-tested marketing techniques to work for you. You can continue to grow your business year over year by applying marketing pressure in the right places. And don’t forget to engage your upstream partner to help with your growth because it benefits both of you.

This post was brought to you by IBM for MSPs and opinions are my own. To read more on this topic, visit IBM’s PivotPoint. Dedicated to providing valuable insight from industry thought leaders, PivotPoint offers expertise to help you develop, differentiate and scale your business.