Marketing: The Channel's Barrier To The Multimillion-Dollar Bottom Line

From solution providers to marketing executives, all are in agreement on one thing: Marketing is not the channel's strongest point, but it should be.

Just because a business provides the highest quality technical product or services doesn't guarantee them success, solution providers and marketers told CRN. However, a good marketing campaign can set an MSP apart in an increasingly competitive and congested marketplace, they agreed.

"If you look at the channel, that's why most of the channel never breaks the million-dollar mark," Robin Robins, author of the Technology Marketing Toolkit and an IT industry marketing expert, told CRN. "They don't know how to market, No. 1. They can't get out of the tech world; they don't know how to make that leap from the tech who does the work to the CEO who runs the company."

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What it all comes down to, solution providers said, is that marketing isn't necessarily in the same skill set, or mind set, of the often technically oriented channel.

"What you have is an inherent difference between the way people approach things. You can be technically proficient but lack the skill set to effectively market your business," said Jeanne Hopkins, senior vice president and chief marketing officer at Continuum.

Marketing is an area of business that smaller resellers, in particular have "historically struggled with," said Jamie Ferullo, sales director of the SMB business unit at Ingram Micro. The cloud has enhanced this change, Ferullo said, because it is mostly a marketing-driven sale.

The problem is that there isn't always a very organized approach to getting more customers, said Dima Kumets, product manager at OpenDNS. Kumets said that he has seen a variety of sources for MSP client growth, from referrals to marketing. He said he knows some businesses that are very connected in the community so referrals work well for them, but more often than not, he said, marketing comes into play.

However, Robins said that can't work forever. The bottom line is that in an increasingly competitive marketplace, MSPs need to learn to distinguish themselves through marketing and form a more concrete business-growth strategy, Robins said.

The key to getting effective marketing, Robins said, is to know your business and know your client, which means knowing exactly what the client wants and how the MSP can provide that to them.

"If they don't, they're forever going to be in these competitive situations working for crumbs," Robins said.

NEXT: What Can MSPs Do About It?

The simple answer as to why MSPs struggle with marketing is that they just don't understand it and don't devote enough time to it, marketing expert Robins told CRN.

"For the most part, they're techs, and for the most part, they really do not like selling and marketing. So they know it's essential for their business to grow, but they really don't like it," Robins said.

The first, and most important, step to improve marketing efforts is to take a good, hard look at the MSPs customer base and define a concrete business strategy going forward. Good marketing is nothing more than an extension of a good business plan, Robins said.

"Being disciplined enough to say 'We can't be all things to all people.' That's No. 1. When you really understand your customers, the reason people are making those decisions is because they really don't know how their customers find them," Robins said. "It's an ongoing commitment to make."

There isn't any such thing as a bad target market, Robins said. Not having a target market is when things start to go sour, she said. Once that part is over, it's not just about peppering Twitter with content or having a Facebook page, Robins said.

"[MSPs] have this view of marketing: They start thinking of it when they need more customers, with really no more thought than that they start these random attempts at marketing and selling," Robins said. "You're going to waste a lot of time and money. You're going to have failed efforts."

Instead, it's about developing a long-term strategy for growth, Robins said. That growth is found in securing quality clients, not just increasing client headcount, she said.

"Top line is for vanity; bottom line is for sanity. It's not just about getting more customers; it's about getting better customers," Robins said.

She gave the example of one MSP who lost 17 clients but had his bottom-line sales shoot up 1,000 percent because he fine-tuned his marketing and sales approach on a focused client base, in this case medical. His sales pitch was focused on how doctors can see more patients and speed up the billing process if they adopted his solutions. It's about connecting the long-term business plan with the sales pitch for a unified client approach, Robins said.

The best marketing begins with a good solution, Robins said, and for MSPs the key is making sure that their product is up to snuff with the marketing and sales claims they are making, she said. It's not about "putting a shiny coat of paint on stuff," Robins said.

OpenDNS's Kumets agreed, saying that even if MSPs were the best marketers in the business, it wouldn't matter if the product didn't match up.

"If a product is not good, if the technology isn't good, you can have the best marketing and the best business terms, [but] you'll last maybe a couple of quarters," Kumets told CRN.

In the end, for MSPs, effective marketing will be about having that tough conversation, asking where the business is heading and what products are in line with that plan that can effectively be sold to the end client.

"We all throw [around] this term about 'solution provider,' but the question is what solution are you providing?" Robins said.