Most of the people working for managed service providers (MSP) have technical backgrounds, and most of the time, they try to solve the problem of marketing their business as a technical issue —  running a single campaign or doing an activity and expecting immediate results. Sadly, it rarely works like that. Marketing requires consistency and repetition. MSPs who are successful at marketing view it as a function, not something somebody does in their spare time.

Adapted from the marketing workshop delivered at the recent MSP Global event in Barcelona, this article will explore how most MSPs do marketing today. We’ll also explore some best practices of MSPs that acquire new customers effectively and which can be replicated by almost any MSP.  

How do MSPs do marketing today?

MSPs employ five marketing tactics: referrals, events, email, social media and content.

Most MSPs rely on referrals to grow their customer base. This is usually the first method they use when they start their business. Quite often, MSPs continue to grow by leveraging their network: their friends, family and satisfied customers. 

Based on hundreds of interviews with MSPs, I’ve learned that most MSPs limit their marketing to referrals, online or offline events and email marketing. 

However, it is essential to highlight that doing one or two events and sending emails occasionally is not marketing. They are one-off activities that may or, most likely, may not bring any results. Activities become marketing when there is a plan, resources are allocated and the organization is committed to executing marketing activities.

Therefore, a prerequisite for marketing an MSP is to have a story:

• A sales pitch that represents the value the business can bring to its customers.
• A well-defined target audience: industry, size and location.
• Consistent messaging implemented in the pitch, the materials you distribute, and your website.

Consistency of the story is essential. Marketing yields results when there is repetition, so it sticks with prospects and customers.

Marketing requires commitment — dedicated resources including money and time, consistent marketing activities and continuous engagement with your prospect database. Sadly, most MSPs make small investments, try some activities, see no results, and stop the activity until they want to try again. Even worse, some MSPs generate the first leads and then stop marketing activities instead of continuing to nurture their prospect database and generate a pipeline; thus, most efforts are lost.

The basic formula for most MSPs is “no leads equals insufficient marketing.” It is vital to create a working and repeatable marketing process and continue running with it; in the process, finding the right mix of activities and the right budget for those activities drive the results expected by the business.

The tools for finding the sweet spot for marketing spend are simple: customer acquisition cost (CAC) and customer lifetime value (CLV). Start by looking at the total amount of money and resources you spend (including the time taken at an hourly rate of people involved) and divide it by the number of customers you sign up. That would be your CAC. Then, estimate how much an average customer pays you monthly and how long they stay with you. Let’s say a customer pays you $1,000 a month, and the customer stays with you for two years: your LTV will be $24,000. Then, compare how much you spend to what you make from the customer and ensure it makes business sense.

When MSPs try to market their services to everybody and try different activities, stopping before they see results, they tend to spend too much and make marketing unprofitable.

How can MSPs improve their marketing?

Improving marketing starts with improving targeting: clearly defining the target profile of a customer. Employing a vertical marketing strategy is a good start for if you have unique expertise in a specific industry or multiple customers from a particular sector. For instance, if you have customers in healthcare, you can create a value proposition for healthcare and use existing customers for referrals and as case studies. 

Specialization helps tailor your proposition, making it easier for customers to believe in your expertise and sign up with you. Understanding the profiles of customers you want to serve, you can talk to them in their language and define the value you bring them based on their expectations.

Vertical marketing allows you to decrease the cost of marketing, as you have the stories to tell, and you choose the best channels to deliver those stories, as well as increase the conversion from leads to sign-ups.

What are some recent best practices for MSP marketing?

One of the most overlooked marketing strategies for MSPs is content marketing — creating and sharing useful content via website, email, social media, professional websites and online communities. It takes effort to create useful content, and it takes time to build a reputation; however, having a public profile as an expert generates long-term effects from people coming to you seeking help and advice in your area of expertise.

However, a word of caution: AI tools like ChatGPT help to create a lot of content, and the internet is filled with automatically generated content. Thus, people are looking for unique ideas coming from unique experiences. Therefore, to make your content impactful, rely on your experience and tell stories from your practice. Even if you are talking about fundamental topics like having strong passwords, sharing examples from your experience will generate more attention from readers and viewers.

The types of content you can share include tips for using IT tools to enhance business, case studies of your customers who have improved productivity using modern IT, educational content, tools like checklists, and IT product reviews. 

Another best practice is account-based marketing (ABM) — selecting a specific list of prospects you would like to acquire as customers, researching as much information about them as possible, and going after them through different channels. Knowing the people who make the decisions about IT or influence those decisions will help you find ways to engage with those prospects and gradually win over the accounts.

ABM requires researching and selecting the accounts, finding the decision makers and building a plan for engaging them, such as attending the events they attend, sending them emails and direct mail, and scheduling meetings with them. This is a complicated and time-consuming process that requires a significant time investment. Therefore, it works best for the largest accounts that can bring significant revenue to your business.

The last best practice to mention is influencer marketing. It does not require signing up a pop star — every person is an influencer within their network. Therefore, it makes sense to look at local influencers, such as community leaders, charity organizers and local clubs that engage with your prospects and work with them to include you and your business in their activities or get them talking about you.

The best way to engage local influencers is by doing joint activities; for example, work with a local business club to deliver cybersecurity lectures or host lectures about IT tools at a local school, engaging the faculty and parents of the students.

Conclusions

Marketing requires consistency, commitment and persistence. Having a consistent story and committing to delivering the story via multiple channels is a prerequisite for allocating marketing investment. And the investment should be long-term, not relying on luck and quick results.