Managed Services, Time to Sell it!

Eric G Steinberg

Principle Consultant/Founder

The Boundless Group, Inc.

Success• Sales success is not an island, but a

synergy of:– Sales and Marketing Strategy– The Sales Force– Training– Focusing on Results– Prospecting– The Sales Call– The Relationship

Let’s Have a Conversation

• Building the Plan

• Getting the Right People on the bus

• Training for Success

• The Relationship

• Prospecting

• The Sales Call

• Managing for Results

Sales & Marketing Strategy

• Defining Sales and Marketing

• Goals

• Branding

• Priming the Pump

Definition of Sales and Marketing

• Marketing– Anything you do to determine what to put on

your cart

• Sales– Anything you do to get your stuff off the cart

Determining What to Put on Your Cart

• Costs

• Pricing

• Features

• Market Research

• Branding

Costs

• Do you know what your real costs are for your MSP Services?

• Do you know your Burden?

• Do you know where Break-even point is?

• What are your variable expenses?

• Do you understand how to make money overall when you have a loss leader?

Cost of Goods Sold• Salary

– Base– Bonus

• Utilization– What percent do you get

for field engineering work?– What percent do you get,

or anticipate getting for MSP

• Payroll Taxes• Insurance

– Health– Liability– Other

• Facilities– Hosting– Staff

• Vacation/Sick Leave• Equipment

– Hosting– Laptops– Other

• Travel– Mileage– Out of Town

• Training– Class costs– Travel costs– Lost revenue costs

Pricing• The million dollar question• Do top down pricing, not bottom up pricing• Fixed Fee• Incremented based on either users, devices or

servers. (Kiss)• All inclusive

– Hardware– Software– Services

• Based on research and SWAG• Mark up verse mark on

Pricing

• Top Down– Establish what the high price your clients will

pay– Establish what margin you’d like– Determine costs– Does it work?

• Bottom Up– Take COGS and mark it up (or on)

What is your offering?

• SaaS

• TaaS

• RMM

• HaaS

• MSP

• How are you different?

Who Would Ever Buy This?

• Why would anyone want to buy this?

• What is it’s (vertical) market value

• How does your offering meet your client’s specific business needs

• Why should they buy it from you?

The Benefits Of Brand Management

• Brand Equity/Value– Awareness– Relevance– Loyalty– Price Elasticity– Extendibility– Competitive Advantage

The Brand Called You

• Who knows your company?

• Who knows what your company does?

• How are you uniquely qualified to meet your clients needs?

• How do you define “Specialized” or “Vertical” markets?

• Branding Test

Brand Positioning TemplateFor _______________________________, ___________________

(Audience) (Brand)is the ______________________________________________ that

(Competitive Set)______________________________________________________,

(Primary Benefit)because _______________________________________________

_____________________________________________________.

The Test

• Go to everyone in your building and ask them if they ever heard of your company

• If they have, ask them what you do

Getting the Right People on the Bus

• Identifying

• Recruiting

• Hiring

• Retaining

• Compensating

Identifying

• What are the characteristics of your most successful sales people?– Skills– Personality (in the selling situation)– Interests

• Always be interviewing

Recruiting

• Where do you find the best sales people– Competition– Vendor– Supplier– Out in the World– Referrals

Creating a Profile• Creating a Hiring Metric

– Part Personality– Part Interests– Part Skills

• Interviewed by someone from each department they will interact with and some of their peers

• Set the bar high

Retention• Work environment• Benefits

– The usual suspects– The not so usual suspects– Develop a career path

• Base pay• Commissions and Bonus

– At the time of the sale– At the time of renewal– Monthly reoccurring

Profile of a successful MSP Sales Rep

• Has successfully sold intangibles

• Knows more about business then technology

• Understands the technology

• Understands the unique requirements of the client’s business/industry

• Fits your metric of a successful sales rep

Training for Success

• Business 101

• Understand the technology behind the offering, but don’t sell it

• Communications

• Critical Thinking

• Questioning

Making Your Price Stick

• The client rarely makes it about pricing. You do!

• If a client does bring up a competitors price there’s generally something else under the surface

• If you sale your product at a 30% GP and give your client a 10% discount, you must sell 1/3 more to make up the same commission/GPM

The Cost Discounting the SaleSelling Price $10,000

Gross Profit Margin 30%

Gross Profit Dollars $3,000

Commission Rate 10%

Commission Dollars $300

Discount 15%

Selling Price $8,500

Gross Profit Margin 26%

Gross Profit Dollars $2,168

Commission Rate 10%

Commission Dollars $217

Forfeited Commission $83

Additional sales required to make up lost commission $3,200

Sales to equal the same commission 32%

Total sales for equal commission $13,200

Getting your Stuff off the Cart

• Advertising

• Seminars

• Lead Generation

• Prospecting

• Sales Calls

Advertising• Why

– Name recognition– Lead Generation

• Where– Newspapers– Radio– TV

• When– When your target audience will see/hear/read it

Seminars

• Establish your expertise

• Create educated prospects

• Don’t sell, give information

• Host a speaker who will attract the type of client you’re looking for

Lead Generation

• Prospecting by calling names out of the Yellow Pages is a kin to banging your head against the wall. It makes you tougher, but not smarter.

• It’s not promoting a sales person’s laziness, it’s promoting their (and your) success

• Sources– References/Word of mouth– Vendors– Seminars– Advertising

Prospecting (Asking for a date)• The only thing you’re doing when call a prospect

is selling an appointment to meet– Never. Never. Send literature or pricing– Never attempt to sell your product or service– Always get an appointment– A fast no is better then a slow no– Don’t sell, have a conversation– Do your research first – Imagine how much easier this is when you have

successfully branded company

The Sales Call (The Date)

– Make a great first impression– Be interested, not interesting (at first)– Speeds and feeds don’t cut it– You must present a business case where you

have a solution to the client’s business problem(s)

– Better yet, have a solution for a problem they never knew they had

The Relationship

• They’re clients, not customers

• You’re looking for engagements, not projects

• Never stop adding value and value isn’t what it used to be

Steps to Success

Planning the Sales Call• Write down each sales calls’ objectives prior to

meeting with a client– An objective that leads you to Proceed forward

• Proceed, don’t prolong– Proceeding is something specific that mores

towards a sale

– Prolonging is where no specific action is taken to more towards a sale, but the sale is not dead

Myth Busters

• Closing questions don’t work

• Be a “hard” closer (2:1 ratio)

• In major account sales, fewer then 10% of sales calls lead to an order

• The product or service doesn’t matter

• It’s all about price

The Client Value Zone (CVZ)

Value Zone

Business knowledgeProduct Knowledge

Knowledge of Client’s Industry

The Value Zone

• This is where you can uncover unrealized problems.

• This represents true value to your client• It differentiates you from the competition• It’s not about asking questions, it about ask the

“right” questions– Industry knowledge– Business person, not sales person– Learn good questioning skills

The Value Equation

• Value = Benefits – Cost

• Benefits = – (Skills + Process + Knowledge) x Effort

• Skills = leading the client to “self-discovery” of the problem

• Process = Learn what specific challenges face your client’s industry and which of them you can solve

The Value Equation (Continued)

• Knowledge = insight in to your client’s industries. Always be learning

• Effort = what you do. Become immersed in your client’s business and where you services delivery a solution.

Managing for Results

• Treat them like adults (don’t micro manage)

• Set mutual goals

• Give them everything they need to succeed

• Gain agree that they will do what ever it takes

• Reward them well

Contact Info

• Phone 303.800.0686

• eMail Eric@BoundlessGroup.com– Email me for a reading list

• Web Site www.BoundlessGroup.com