Cloud Partners Speaker Highlights Untapped Managed Services Market

CLOUD PARTNERS— Managed services is a largely untapped market that can offer huge benefits for those who are smart in their approach and know their potential customers’ needs.

That’s according to Carolyn April, CompTIA’s director of industry analysis. She was a keynote speaker at Cloud Partners in Boston on Thursday.

April shared the results of an end-user study involving 350 companies of all sizes and all industry sectors. The results highlighted opportunities, demand drivers and challenges.

“Despite managed services having been in our milieu for a decade or more now, the adoption rate is still not that high, we are not a saturated market,” she said. “There’s a lot of education the channel can provide to potential customers to get them to understand the benefits of the model. And if you do that effectively, you will see adoption rates go up.”

Among the findings: 65 percent of managed services customers still handle the bulk of their IT internally, while half said the way their firm handles IT could be better, April said.

Also, many end users don’t know what managed services means, and therefore how it could benefit them, she said. At the same time, six out of 10 firms that use managed services would recommend their model to other firms, while another 40 percent said they probably would, she said.

“Don’t sell yourself short as an MSP,” April said. “Don’t just work at the lower levels of what you can do for a customer. Customers today want much higher-level, sophisticated types of solutions from the third parties that they work with.”

Potential customers are interested in higher-level services like business intelligence and data analytics, she said. Customers are eager to “get their hands on emerging technology” that they otherwise may not be able to afford if they’re on-premises types of installations, she said.

“Help them with their data,” April said. “There’s so much flying around in the cloud and in their on-premises equipment that they need to harness that in some way and be able to turn that into actionable information. If you’re able to do that as an MSP, then you’re at a much higher level than the rank and file.”

One of the most surprising findings was that end users aren’t as concerned about saving money as they are with learning how managed services can add value to their organizations, she said.

“Don’t sell on price only, it’s not as important as you think to customers these days,” April said “If you begin to commoditize yourself, you get into a trap where you’re stuck in a contract that a happy customer, because they love the low price, is going to want to renew at that same low price, and it becomes sort of a vicious cycle.”