For most managed service providers, the big questions are “how do you grow your business, add new customers, and reap the benefits of monthly recurring revenue (MRR)?” I’ve seen many strategies over the years, but I want to share one with you that works particularly well for service driven businesses.
Introducing the “Wedge” product, a product that wedges open the door to new customers and provides an upsell opportunity to your installed customer base.
To introduce your very own “Wedge” product we recommend the following:
- Identify your area of expertise (either by vertical or by industry)
- Focus on the needs of your target audience
- From this information, define a “Wedge” product or service that allows you to provide a monthly benefit to your target audience
- Build a communication plan to inform new and existing customers about your new product or service
First, to identify your area of expertise, look at your skill sets, the markets you serve, and the technical experience of your team.
Next, take a look at your existing customers. Do they represent a specific industry or vertical market? What other characteristics do they have in common – business size, annual revenue, service or product company? What are their needs and challenges?
Armed with this information you can now identify your “Wedge” product which will open the door for selling more of your unique managed services business to new and existing customers.
Choosing the right “Wedge” product is not as easy as picking something you have in your existing tool kit. Your prospects may already have many of their technology business solutions in place, so you need to look beyond the obvious. You will need to identify something that is unique to you and differentiates you from your competition. For example, data backup, disaster recovery, and Business Continuity can be very effective “Wedge” products. Have you asked your customers or prospects directly what their disaster recovery plan is? If they answer that they already have a tape, online only, or other homegrown data backup strategy in place, you’ll want to help them understand where they may still be vulnerable…enter your “Wedge” product.
You can position data backup, disaster recovery, and Business Continuity as your “wedge” product by asking a few simple questions:
- “How long will your business be down if you lose a major file or server?” They should know whether their current solution offers a failover or server virtualization service to get them back up and running in minutes.
- “Where is your data stored?” The datacenter should be in a protected, safe, compliant data center that is SAS70 Type II certified.
- “Have your backups been tested lately?” 42% of small to medium size businesses’ that experienced data loss were unable to restore, even though they thought their data was protected.
Additionally your customers need to understand that data protection is more than backup; it is an insurance policy to keep their businesses up and running in the event of a server failure or disaster. Keeping businesses going without significant loss to productivity requires virtualization services and offsite disaster recovery services.
Data backup services are just an example. Keep your eyes and ears open for other “Wedge” products that will open the door for you. As you attend industry events or participate in forums and blogs think about what products could wedge you in and start a dialog with new and existing customers, believe me they are out there.
Finally, be sure to build a strong communication plan to regularly reach out to both new and existing customers. To develop your communication plan, work with your local Chamber of Commerce, a list broker, the yellow pages, etc. to create a list of prospects that meet your defined criteria. Then build a plan to communicate with them or create a referral program with other similar service companies where you can share leads and reward the referrer.
Here’s to finding your “wedge” product in 2011 and to generating new MRR while providing high quality services for your customers!