Ingram Micro GCIS: Getting MSPs to Rethink Their Growth Strategies
MSPs don't seem to get the growth they want.
Marie Rourke/WhiteFox Marketing
There are a lot of businesses out there that believe there’s risk to their business from a cybersecurity perspective, but aren’t mature enough to make the investment to solve for it, said Ingram Micro‘s Paul Hager.
“And we spend a lot of time in our sales cycles talking to those businesses that will never buy the cybersecurity solution because they just aren’t fundamentally mature enough to make this size of investment that will be needed,” he said. “The reality is, as you get more mature, you start to understand that this is a math game. So one in four will be mature enough to pay for your assessment. One in four that you deliver assessments to will ultimately be willing to pay the price that you should be charging to ultimately solve for all this, all the cybersecurity tools you’ll need to put into one bundle to make one flat price. So once you start doing that math, you start to get to, this is how many customers we need to grow by this year.”
Photo courtesy Marie Rourke/WhiteFox Marketing
Many MSPs believe more salespeople equals more sales, Hager said. Focusing on sales isn’t going to get the results MSPs are looking for.
“MSPs need to invest more in marketing,” he said. “So you need to work back from your math and then you need to invest in marketing. And the other thing I see is people equate marketing to the tools that run their business. So MSPs are addicted to their tools and they think of their ConnectWise and their Autotask, and their CloudBlue SaaS. But those are sales. Those are tools that help you run an effective service operation. They are not marketing automation tools. They’re not these platforms that are purpose-built to get people through a nurturing relationship and deal with the top of the [lead] funnel.”
Photo courtesy Marie Rourke/WhiteFox Marketing
One of the problems is people who start MSPs don’t tend to come from marketing, Hager said.
“They tend to either come from sales who fundamentally are afraid of marketers because they’ve never had a marketer deliver them a good lead so they don’t trust them, or they come from technology, so they were the best technologists at their prior company and then marketing is very far away from that technical brain, usually a marketing brain over here and technical brain over there,” he said.
Another problem is vendors have millions in unused market development funds (MDF) that could be helping MSPs and MSSPs, Hager said.
“So here we have this community of MSPs and MSSPs saying, ‘I want to grow my business, I want more lead-generation,’ and we have the vendors saying we have money,” he said. “So what is this divide? My challenge to MSPs is if you’re hearing no on MDF, we have the data that says they have it, they just don’t have it for you. And so you need to take a bit of a look in the mirror and say, ‘Why don’t they have it for me?’ And because we were leveraging modern tools, we could actually show ROI. So we could say, ‘If you give me $1, I will bring you $10 more. Well, if you can show that with data, you’re going to get more MDF.”
Ingram Micro is well-positioned to help MSPs get the most from vendors, Hager said.
“We have the relationships with the vendors, relationships with great partners and a phenomenal partner community,” he said. “It’s our job to take friction out of the channel and this is one of those places where we can help do that, provide the advice to the MSPs, provide that guidance, connect them with vendors that are appropriate, help them build their stacks around those vendors and bring their solutions to market and accelerate that through the MDF that we know is already out there.”
Hager said there are signs of improvement in terms of MSPs and MSSPs doing what they need to do to grow revenue.
“I think there are MSPs and MSSPs that are doing more thought leadership around cybersecurity, hearing that they have to get that message out, they have to be viewed as a leader and then capitalizing on that,” he said. “We’re definitely seeing that improve this year over what it was a year ago, and certainly two years before that. Every market is different. And the United States tends to lead the way. We see Canada tends to be just a few years off the United States trends for some of those motions.”
Economic headwinds have impacted all partner types, Hager said. However, MSPs have weathered it a little bit better because they have long-term contractual relationships.
“They were already in an opex model,” he said. “The opex isn’t the first place people look [when budgets are tight]. It’s the capex. But you know there continue to be challenges, but we’re still seeing growth among key partners in that space as well.”
During economic uncertainty, one of the first places most small businesses go is spending less on marketing, Hager said.
“That’s an easy variable to take out, when in reality you should lean into marketing more than your competition,” he said. “So if Ingram and our vendors can help solve for that by actually making them more mature and getting more out of the vendors in this time, that isn’t their own dollars. Now they can accelerate marketing through this time versus pull back from it.”
Also during the conference, Ingram Micro announced its GCIS 30 Awards, recognizing individuals and organizations that are leading the way in digital transformation.
Reseller Partner of the Year:
Alpine Business Services
Platinum Technology
Bohnen IT GmbH
Vs Data Comercio
Solution Partner of the Year:
GreenPages
Fuse Technology
TIEVA
ASIC
Quiss Technology
Growth Partner of the Year:
ConRes IT Solutions
Success Computer Consulting
Alliance Business Technologies
Exakis Nelite
Nortec
Breakthrough Partner of the Year:
Access Computers
InsITe Business Solutions
Precision IT
Bee Wise
Tech MVP of the Year:
James Rocker, Nerds That Care
The Women in Tech Awards include:
Community Ally: Natasha Reynolds of SOCO and Kathy Mills of Strategic Communications
Employer of the Year: Microserve
Female Leader of the Year: Maria Jesus Urdanivia of Adexus, Sindy Bauer of Bohnen IT GmbH, Deepti Morjaria of Cloud Made Simple, and Dao Jensen of Oak Rocket
MVP Woman of the Year: Siobhan Cox of Bell Canada
The CloudBlue Awards include:
Innovator of the Year: America Movil
Global Customer of the Year: Dell
Breakthrough Customer of the Year: Telefonica Tech
Visionary Customer of the Year: Vuzion
Also during the conference, Ingram Micro announced its GCIS 30 Awards, recognizing individuals and organizations that are leading the way in digital transformation.
Reseller Partner of the Year:
Alpine Business Services
Platinum Technology
Bohnen IT GmbH
Vs Data Comercio
Solution Partner of the Year:
GreenPages
Fuse Technology
TIEVA
ASIC
Quiss Technology
Growth Partner of the Year:
ConRes IT Solutions
Success Computer Consulting
Alliance Business Technologies
Exakis Nelite
Nortec
Breakthrough Partner of the Year:
Access Computers
InsITe Business Solutions
Precision IT
Bee Wise
Tech MVP of the Year:
James Rocker, Nerds That Care
The Women in Tech Awards include:
Community Ally: Natasha Reynolds of SOCO and Kathy Mills of Strategic Communications
Employer of the Year: Microserve
Female Leader of the Year: Maria Jesus Urdanivia of Adexus, Sindy Bauer of Bohnen IT GmbH, Deepti Morjaria of Cloud Made Simple, and Dao Jensen of Oak Rocket
MVP Woman of the Year: Siobhan Cox of Bell Canada
The CloudBlue Awards include:
Innovator of the Year: America Movil
Global Customer of the Year: Dell
Breakthrough Customer of the Year: Telefonica Tech
Visionary Customer of the Year: Vuzion
Ingram Micro’s Global Cloud and Innovation Summit (GCIS) is providing MSPs lessons on how to rethink their growth strategies.
Paul Hager, Ingram Micro’s vice president of services, will give a presentation titled, “Modern Mindset: Best Practices in Sales and Marketing for Today’s Modern Security MSP.” We sat down with Hager to discuss his advice for MSPs’ growth strategies.
Before joining Ingram Micro, Hager owned and operated an MSP and was an Ingram Micro customer for 10 years.
“I think Ingram is trying to continue to show up more relevant to the modern MSP, bringing one of the former MSP leaders that they knew in the community and putting them directly into executive staff where I sit today,” he said. “And one of the things we’re particularly going after is, every MSP that we talk to says that they want to grow their business. But a lot of MSP business owners, they don’t know how to go about doing that, or if they’re a large VAR and they have a small MSP business that they’re trying to grow.”
MSPs’ Growth Strategies Built Around Recurring Revenue
Overall, MSPs are built around growing recurring revenue, whether its monthly recurring revenue (MRR) or annual recurring revenue (ARR), Hager said.
Ingram Micro’s Paul Hager
“At the end of the day, everyone’s trying to grow that pile because that’s where you’re driving more value for the valuation of your business,” he said. “This is where higher margins are. If you’re a VAR getting into the MSP space, you probably did it because you looked at your margins on hardware and said that’s not sustainable long term or not as attractive as even a smaller revenue number. And it’s just another way for partners to make the shift away from transactional business to value-based recurring businesses. And Ingram is here to try to help with that a bunch of different ways, whether that be our Xvantage platform making things more consumable and as a service, our cloud marketplace bringing those things together, or just our MSP focus group.”
MSPs don’t seem to get the growth they intended to get, Hager said. They don’t seem to hit the ROI numbers they’re trying to hit.
“And I think it’s really my challenge to the community that they need to think differently and they need to become better stewards of their own business and the math that drives this business,” he said. “So when I was running what I’d like to think was a pretty operationally mature business, we knew that data around our business. We knew for every time we did a security assessment, one in four of those that we even talked to, those customers bought our security assessments. We charged for it because it established value. If you give things away, it has no established value. And you need to weed out the bad customers faster because you’re trying to sell to the top 25% of the top 25% of your market because that’s really where the MSP market space is. You need a very mature end customer that understands the risk to their business and believes in solving for that risk.”
Scroll through our slideshow above for more from Hager about MSP growth strategies and more from GCIS.
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