SMBs are curtailing non-critical spending and restricting growth—many may go out of business entirely. This is the harsh reality organizations are facing right now. Dealing with the economic impact of COVID-19, SMBs across several industries had the rug pulled out from beneath them seemingly overnight.
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Some have adapted nicely, but virtually every industry is experiencing significant setbacks and grappling with the prospect of reduced growth projections through the end of 2020 and beyond. This makes the role of selling, or even renewing, technology service contracts more complicated. Every contract is up for bid, and most companies—especially MSPs—are facing these challenges:
- Keeping customers secure amid a spike in remote work and BYOD
- Proving their value, so they don’t lose contracts to competitors
- Maintaining enough cash flow to stay viable
- Generating revenue while customers are cutting costs
- Grappling with uncertainty about the future and how to plan ahead
Secure More Client Relationships
To remain competitive, managed service providers need to offer what’s in highest demand right now—advanced cybersecurity solutions that support end users, no matter where they work. A recent survey revealed that 46% of responding organizations have already experienced a cybersecurity breach due to COVID-19, and another 49% are expecting to experience a security-related breach within the next month.
As SMBs look for places to trim operating budgets, MSPs can’t rely on new client acquisition as their primary growth path. This strategy may have worked well in years past, but it’s no longer enough to sustain your practice. Providing security services that prevent costly data breaches is the way to justify the value of your services to clients right now.
5 Verticals Growing IT Spending
Though the majority of markets are cutting IT spending by anywhere from 3% to 27%, five verticals are expected to grow their IT spending through 2020. Here are five verticals still growing their IT spending:
- Government (13%)
- Food & beverage (11%)
- Technology (9%)
- Healthcare (9%)
- Real estate (3%)
Simply going after new customers in these high-growth areas or expecting renewals from customers in these markets isn’t realistic. The projected growth of these markets is still less than what it was expected to be at the end of 2019. This means that even the strongest sectors are likely working with smaller budgets than previously expected.
Bottom line, to win contracts with any organization, MSPs must work harder than ever before to persuade budget-strapped companies that their services can help organizations achieve important objectives that likely include reducing overhead, empowering remote productivity, and minimizing costly data breaches.
Engage in Risk Management Conversations
Have you had an honest conversation with your clients around their risks and the need for a new standard of security? If you haven’t, your competitors would be happy to beat you to it. The landscape is changing, and SMBs without adequate security solutions risk falling victim to one of the many threat actors on the rise. Ransomware attacks alone rose 148% between February and March of 2020.
Now comes a more challenging question: If a client is open to spending more on security, do you have the offerings to capture that spend? If the answer is ‘no,’ consider growing your offering to include a complete platform of robust network security and cybersecurity options.
Delivering cybersecurity solutions equips MSPs to expand their relationship with existing clients while building new recurring revenue. To achieve this profitably, MSPs need rapidly deployable, scalable, and affordable solutions.
Offer More Value for Existing Customers
Since MSPs can no longer rely on new client acquisition as their primary growth path, focusing on issues that SMBs consider business-critical—network security, monitoring employee behaviors, boosting productivity, etc.—MSPs can expand their relationship and drive new recurring revenue from clients in the future.
Working from home has created new security risks. How are your clients adjusting? Have you brought recent dark web exposures to your clients’ attention? A quick cybersecurity assessment is a great way to help customers understand the security risks that arose when they transitioned to remote work and BYOD. Once they understand the present risks, you can show them how your solution can save their organization money over time via threat prevention.
Change Your Go-To-Market Strategy
Budgets are tight, and most companies are looking for places to cut funding, not increase it. If a client needs more security but is not in an economic position to commit or pay at this time, how are you handling those situations? If you are in the position to do so, consider offering creative payment solutions that deliver needed services now without adding additional charges until things stabilize.
While this approach assumes risk, it also creates the opportunity to earn more revenue and customer loyalty. This shouldn’t be offered to every customer. Consider creating a framework for approval or approaching your top 10 accounts if they’re expressing issues making payments. It could be an effective way to support your best accounts now while reaping revenue increases in subsequent quarters.
ConnectWise can help you engage in better conversations, offer more value for your current clients, and change your go-to-market strategy. We've developed the MSP+ Foundation Pack to assist MSPs.
The MSP+ Foundation Pack is a rapidly deployable cybersecurity solution without a hefty cost or overhead burden. It includes:
- Dark web scanning & monitoring
- Threat detection & response for Microsoft® and Azure AD
- Advanced endpoint protection
- 24/7 SOC support
- Unlimited essentials and comprehensive cybersecurity risk assessments
- Security training for internal team members
- A security go-to-market strategy
Discover how the MSP+ Foundation Pack can jumpstart advanced cybersecurity for your clients now, when they need it most.
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