Running your business News
Huge Opportunity For MSPs, Datto Survey Shows
Joseph F. Kovar
Datto's Lauren Looney uses the stage at this week's NexGen 2019 conference to present the results of a survey her company did to measure how well SMBs understand MSPs, and followed with an MSP call to action based on some of those results.
Small and midsize businesses really do like managed service providers, which gives MSPs opportunities to expand their business with a wider range of clients that have not yet embraced outsourced IT services.
That's the word from Lauren Looney, channel development manager at Datto, who told MSP attendees at this week's NexGen 2019 conference nobody knows better than they do what SMBs need to grow their businesses.
"Now more than ever before, you as an MSP have the ear of the SMB," Looney said.
Looney based her observations on a new survey Norwalk, Conn.-based Datto recently conducted showing perceptions in the $100-billion SMB market of outsourced IT services at the request of the company's MSP partners.
The survey, which covered 1,100 SBMs across the entire U.S. found that 71 percent of SMBs still depend exclusively on internal IT capabilities, which Looney said was both good and bad.
"$100 billion?" she said. "That's $70 billion still open to us."
About 12 percent of SMBs use outsourced IT services exclusively, and 17 percent have converged internal and external IT services, Looney said.
"Converged IT lets partners in the door," she said. "This is something they might not have been able to do before."
About 79 percent of SMBs in the survey called security a big IT challenge for them, followed by 78 percent who said tech support and maintenance were big challenges and 72 percent who said both increasing IT costs and increasing IT complexity were major challenges, Looney said.
About 54 percent of respondents who do outsource their IT services said they do so because of the increasing complexity of IT, and the same percentage said it was because they found outsourced IT more cost effective. about 48 percent found outsourced IT a way to overcome a lack of internal IT skills, she said.
Another bit of good news from the survey is that 46 percent of SMBs expect their IT budgets to increase in the near future, 47 percent expect budgets to remain flat, and only 3 percent expect IT budgets to fall, Looney said. And 56 percent of SMBs are willing to spend $50 to $150 per employee per month on IT services, she said.
That may not be what clients say when talking to MSPs, she said. "But they have that budget," she said.
However, Looney said, not all news is good news. SMB IT services currently has a net promoter score, or NPS, which measures the difference between active promoters of a company or idea and its detractors, of only 18 percent.
That does not mean SMBs do no like MSPs, but instead it means they are not actively promoting them, she said.
Looney outlined a four-part action plan MSPs can use to help generate more business.
The first is to better communicate their value to clients with such moves as quarterly business reviews, regular technology and security training, on-going communications with clients, and a solid social media strategy.
The second is to reach out to clients to get references and referrals. Looney admitted that such an activity can be awkward, but said that when clients understand an MSP's value, it becomes much easier.
The third is to develop a standardized on-boarding process to attract and work with new clients, which Looney said should include a "white-glove" experience.
The fourth is to increase investment in people and capabilities, including looking to outside talent with new skillsets who can bring in fresh perspectives, she said.
It’s nice to see how many potential clients are out there that need the services MSPs provide but who do not really know that they do, said Kyle Barney, IT manager at Highpoint-IT, a Coeur d'Alene, Idaho-based MSP and Datto channel partner.
"I will use this information to go out and talk to potential clients about the kind of cost savings we can offer," Barney told CRN. "But I won't be talking about how we can help reduce IT jobs. Instead, I'll focus on how we can help reduce costs with our services."