Essential Guide to Selling Managed Cloud Services

Essential Guide to Selling Managed Cloud Services

The cloud market for SMB According to Gartner, by 2016 cloud computing will be the bulk of new IT spend 1. This is a huge opportunity for managed service providers. In fact, Spiceworks State of the Cloud Report reveals that 39% of SMB market is not using cloud services 2, leaving a large opportunity for today s IT service providers; however, not all opportunities are worth your time. In this guide we will address what a good prospect looks like, where to spend your time selling managed cloud services and how to close the deal. 1. State of IT Report, Spiceworks, Accessed: 2015-01-21 Available at: http://www.spiceworks.com/marketing/state-of-it/report/ 2. Press release, Gartner, Accessed: 2015-01-21 Available at: http://www.gartner.com/newsroom/id/2613015

Identifying the Right Customer It is important that we understand what a good sales lead looks like compared to poor leads that could drain your time & resources. It is critical that you avoid investing in sales leads that have a low likelihood of purchasing. Here are some signs that a business may be ready for managed cloud services: They have a problem that can be solved by a cloud service. They have enough hardware going end of life to make an ongoing operating expense more appealing than a capital expenditure for a replacement They have high internal IT costs that could be replaced with a cloud service. They have strict reliability or uptime requirements

Know your prospect: Reactive vs Proactive IT A prospect s attitude towards IT spend is going to fall somewhere along the pendulum from a purely reactive mindset where IT spend is minimal to a full managed mindset where IT is a large investment. Reactive prospects are price sensitive and respond to tangible benefits such as saving money, time or resources. Proactive customer depend heavily on their IT infrastructure and are willing to invest more to avoid costly downtime. Managed cloud services has a place for both and some MSPs choose to eat rabbits while hunting elephants meaning you collect many small predictable cloud services sales while you are waiting for the larger opportunities to close.

Barriers to a Great Sale Here are a few of the roadblocks that you can encounter on the journey of selling managed cloud services: If a company has recently made a large capex investment that is related to the cloud service you are selling, there is likely no budget to invest in a cloud migration. If a business has a low overall IT spend you may be able to convert a customer to cloud based on cost effectiveness alone. This, however, results in lower revenue than opportunities where a prospect has a large business problem that you can solve. Emotional resistance to cloud is unpredictable and in some cases you may find that you need to move this type of prospect from an active sales cycle to an educational drip-feed marketing campaign. Rather than spending valuable time trying to understand the root cause of their resistance and persuade them you can focus on customer who embrace the cloud and have a need to solve.

Closing the Deal Consider submitting two proposals for every cloud services opportunity. Your first proposal is the traditional CAPEX based proposal of replacing a server for $10,000 plus a project setup fee of $5,000. Your second proposal highlights the benefits of cloud services and an OPEX of $400 per month. Contrasting is a powerful sales tool and can be very useful for prospects still deciding if they want to jump into cloud services. According to CDW, 37% of IT professionals surveyed say that senior management is pushing IT to switch to operating expenses model 1 and you can leverage this to your advantage. 3. CDW s 2013 State of The Cloud Report, CDW, Accessed: 2015-01-21 Available at: http://www.cdwnewsroom.com/wp-content/uploads/2013/02/cdw_2013_state_of_the_ Cloud_Report_021113_FINAL.pdf

Conclusion Businesses have been migrating to the cloud faster than expected and MSPs providing cloud services should be capitalizing on prospects who are considering making the switch. By 2016 cloud computing will be the bulk of new IT spend - Gartner 39% of SMB market is not using cloud services - Spiceworks 37% of IT professionals surveyed say that senior management is pushing IT to switch to operating expenses model - CDW If you can sell the value of cloud instead of buzzwords, if you spend your time with prospects wisely and if you can compare CAPEX to OPEX expenditures you will be in an excellent position to succeed at selling cloud services.

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About N-able Technologies N-able Technologies by SolarWinds is the global leading provider of complete IT management, Automation, and MSP business transformation solutions. N-able s award-winning N-central is the industry s #1 RMM and MSP Service Automation Platform. N-able has a proven track record of helping MSPs standardize and automate the setup and delivery of IT services in order to achieve true scalability. N-central is backed by the most comprehensive business enablement support services available today and the industry s only Freemium licensing model. Thousands of MSPs use N-able solutions to deliver scalable, flexible, profitable managed services to over 100,000 SMBs worldwide. With offices in North America, the Netherlands and Australia, N-able is 100% channel-friendly and maintains strategic partnerships with Microsoft, Intel, IBM, CA, and Cisco among others. 2015 N-able Technologies, Inc. All rights reserved. N-able Technologies, Inc. s trademarks, service marks, logos and copyrights are the exclusive property of N-able Technologies, Inc. and its affiliates. All other trademarks or works mentioned herein are used for identification purposes only and may be or are intellectual property of their respective companies. N-able Technologies and SolarWinds Worldwide, LLC are not affiliated with any of the respective companies.