Q: I typically rely on referrals as a main source of new business, but I seem to be getting fewer and fewer these days. What should I do?
While referrals can be great in helping your business grow, unfortunately they aren’t a long-term strategy. Luckily, this isn’t the only way to get clients through the door — you can use tactics like email marketing, direct mail, and even cold calls to capture their attention.
To help you build your MSP business pipeline, we sat down with an expert on the topic. Carrie Simpson is CEO and founder of Managed Sales Pros. It is a sales prospecting firm dedicated to growing and providing new business opportunities to IT service providers. With her extensive background in generating new business pipeline, Carrie shared some of her advice for IT service providers who are looking for long-term strategies on how to achieve this.
Getting leads beyond referrals
Referrals are a gift, they aren’t a business development strategy. At some point, the referrals are going to stop coming in. If they stop coming and you don’t have a pipeline, you could go out of business.
Most MSPs who call Managed Sales Pros, say that they have always relied on referrals and they have stopped coming in and now they are scrambling to build their pipeline. This isn’t a quick fix. Building your pipeline is a year-long activity. You can’t just start cold calling now and see results in Q4. People aren’t thinking about the long term. They want money now.
The cold calling sales cycle is typically two years long. The whole point of it is to start building a database of knowledge. While the phone is a great tool for your business, selling on the phone alone is next to impossible. It isn’t a sales tool anymore – the phone is a marketing tool. The point of a call is to get in front of somebody and to have a conversation with them, so you can develop a relationship and build trust.
The point of an #MSPsales call is to get in front of prospects and have a conversation with them, so you can develop a relationship and build trust.
Odds are, you are calling someone who already has computer support. The goal is to position yourself as a subject matter expert and create relationships. From there, you can ask questions to find out where your competitors are winning. This can help you adapt your approach to ‘win’ more business in the future. For example, how is Joe’s IT company winning business from every law firm in Los Angeles? To find out why, call some of the law firms and ask them why they like working with Joe. While this seems simple, doing this can help you pinpoint what is important to that vertical.
To win, you need to clearly reposition yourself to compete. Do you have something to offer that is better, different, or of more value? If this company is always winning the business you want, then it is good to know why that is happening, and where they might be falling short. There’s got to be something that they are doing that you can do better.
Using cold calling to propel your business
Unless you have a full-time cold caller as an MSP, the odds of winning a more than a couple of deals per year is slim. As a business owner you don’t have the time to make the amount of calls it takes to generate new business. If clients are generating four to five leads a month, that’s considered a good month.
By the Managed Sales Pro definition, a lead is completely qualified and ready to talk to someone about buying. Generally, this business is going to make a decision within the next six months, and they have a budget that is appropriate. These aren’t just marketing qualified leads; they know what you do. They have talked to you about replacing what they are doing currently for IT support, and you have identified their current pain points. They have an appropriate timeline and budget, and you know who the initial decision maker is and nurturing it into a viable sales opportunity.
You should only have to do cold calling in your market – if your market is an average sized American city — for two years. After that, it should be almost all account-based marketing. By creating a two-year window for outbound cold calling, you can pull everything you don’t want out of your pipeline. This gives you the opportunity to identify prospects you want, when their contracts are up, and who they are currently working with. From there, you can market to them based on the information you discovered.
There is no point in calling somebody whose contract is going to be up in two years. Calling them on a weekly, or frequent basis is just going to aggravate them. Instead, you are going to want to take a different approach than someone whose contract is going to end in 90-days.
That’s why it is essential to ask the right questions. If you aren’t, you are not going to succeed with cold calling. Cold calling is about gathering data, more than it is about winning.
If you aren’t asking the right questions, you are not going to succeed with #ColdCalling. Cold calling is more about gathering data than about winning. #MSPsales
Look at it this way: What is the most valuable thing in an organization? It’s the customer database. When IT companies acquire another IT company, what do they want to see? They want to see what their pipeline looks like — not just their current clients and when the contracts expire.
Showing accurate three-year projections based on contract end dates and number of desktops is invaluable. People forget about that when they jump into the sales process. You want to gather that information first, and it will tell you everything you need to know on how to proceed. If you can identify what they are interested in, or why they bought from that company – that helps.
Cold calling and generating sales is a lengthy and ongoing process – and you aren’t going to necessarily win business right away. However, starting the process now can help you build a stronger, more sustainable pipeline down the road.
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