Filed under: Ingram Micro, marketing | Tags: marketing, Seismic, Value Proposition
When you think of what it is your company does, who do you think could explain it well? Here’s a newsflash: Probably not your employees.
I’ve been saying this for years – and sometimes sound like a broken record – but our challenges with marketing and selling our value in the IT channel really start with being able to explain a simple value proposition to our customers.
Do this simple experiment. Setup a video camera on a tripod in a conference room at your office. Without warning, invite each of your employees into the room, one at a time, and ask them to give you the 15 second elevator pitch about what it is your company does. Once you have captured each employee’s pitch, compare them.
What you will find will trouble you.
Now, it’s not that your employees are intentionally misrepresenting your company nor are they poor elevator pitchmen. It is simply the wide variation of responses you receive that will define the problem your customers are having, or your prospects will have, when trying to understand what you do for them.
If your employees, who work inside your company every day, have such a disparate view of your company, what are they telling your customers? Imagine the disparate messages your customers are receiving?
It falls to management to define your company’s value proposition and ensure each of your employees is able to understand and communicate it properly. The simple exercise of defining your value proposition and solidifying the standard company elevator pitch will help both your customers, as well as your employees, understand what value you bring to them. Ultimately, it may help you win new customers and shorten your sales cycles.
Nevertheless, you don’t have to tackle this alone. Ingram Micro has helped hundreds of solution providers tackle this very issue – with outstanding success.
Filed under: Uncategorized
Stay tuned for full details on our upcoming announcement – Ingram Micro Seismic and Nimsot have joined ores to target the mid-market and enterprise space. More details next week!
Filed under: Ingram Micro, IT Distribution, IT Services, Managed Services, marketing, Uncategorized
The managed services market is growing rapidly and has strong, long-term potential for many who are pursuing it. It is changing the way IT services are consumed and delivered. It is helping many of us diversify and strengthen our value propositions and balance sheets. We are all bullish about the future and the opportunity in front of us.
There is one significant hurdle, however, that nobody seems to want to acknowledge – the proverbial elephant in the room. For those of us who target the reseller, solution provider, or managed service provider market as our customer base, this issue is top of mind. Selling managed services is hard, but not because of the technology involved.
Not enough end users are consuming their IT services in a “managed service” form factor yet. There is a very real, and very problematic growth bottleneck at the point of sale with end users of these services. We, as an industry, are simply not getting the penetration into the end user base that is required to grow and scale this market quickly. And for many of us, that growth is not happening fast enough.
In fact, the technology sale is not the problem. The bigger issue here is the selling itself – how do we take our offerings to the next end user? And the next? And the next? If you ask several solution providers how many customers they have and then ask them how many managed services customer they have, you will find that the managed services penetration into their overall customer base is low. Why?
We, as an industry and a channel are still not investing enough in the sales and marketing capabilities of our respective organizations. Everyone is to blame – vendors, distributors, solution providers. Nobody invests enough in developing their sales and marketing capabilities.
When I hear a VAR ask a vendor how much margin is available for him to sell a managed service, I know we are not evolving. The margin in any managed service is how much you can get, not a number determined by a vendor or application provider. Yet we continue to ask those around us, or blame each other, for margins we can or cannot get out of any particular offering. The reason that this concept is so hard for us to grasp is that we simply don’t understand how to sell value and differentiate ourselves from one another. And until we recognize that and take steps to resolve it, we will always struggle to provide the value proposition that customers demand from us.
If you find yourself fortunate enough to have some dollars to re-invest in your business, where are you going to focus those dollars?
The managed services market is never without its intrigue. Vendors, application developers, tool providers, platform aggregators, managed service providers, solution providers, and end customers all swimming about in the fragmented, highly competitive, primordial soup that is a growing market.
However, there are many companies among us who are vying for the managed service provider or solution provider business, that prescribe to a vision that is hindering the explosion of opportunity in this market. Vendors, application providers, peer group organizers, and service providers are among this group. We, the above mentioned suspects, are not the center of the solar system or universe. The Sun does not rotate around us, nor do solution providers, managed service providers, or end customers. So why do we keep acting like they do?
This may come as a shock to some of you. Possibly even bruise egos. Some of you may accuse me of heresy. Perhaps you should sit down, maybe take some water.
Fragmented markets must eventually organize. They cannot, by nature, remain fragmented if there is a legitimate growth opportunity to be had or if scale is required to obtain that growth. Why? Because singularly focused applications or companies, or specific tools that deliver a specific value, are in-of-themselves unable to deliver the growing ease-of-use and broader applicability that the scaling market will require of them.
If I’m an ice cream shop and I make the best vanilla ice cream in the world, how long will it be until a customer asks for chocolate or strawberry? What do I do then?
- Do I learn how to make chocolate or strawberry ice cream?
- Do I send them to a partner who makes and sells those flavors?
- Do I buy and integrate a partner who makes those flavors?
- What do I do if the customer starts to ask for adjacent products like milk shakes and sundaes?
- What if they ask for a gluten free, dairy free, soy free chocolate malt? Then what?
The point is the universe doesn’t revolve around my vanilla ice cream shop. It doesn’t matter if I make the best vanilla ice cream in the world. Customers will eventually demand I diversify my offering into additional flavors or confections. My customer will start to demand more “functionality” from my company in the form of product breadth, an elegant customer experience, and the convenience of getting all of those things in one place.
What are you doing about offering different flavors? What is your plan for milk shakes and sundaes? Can you grow without offering those things? Can you stay singularly focused and niche forever? Do you see strong growth opportunity or are you already at war in a market share fight?
Beware – market share battles in nascent, fragmented markets should be a clear wake-up call – it’s time to revisit the long-term strategic plan.
“Geocentric Companies” – those organizations that believe they are the center of the universe and their customers revolve around them – are everywhere in this fragmented managed services market. Can you spot them? Once you convince yourself that your customers are beholden to you, expect trouble.
“Heliocentric Companies” – those that believe the universe revolves around their customers – are the ones that emerge from the fragmentation and assume leadership positions, sometimes for the long-term. They separate from the pack by offering the breadth and customer experience required to sustain growth and long-term value to their customers.
What kind of company are you? More importantly, what are you doing about it?
Filed under: Uncategorized
I found this article, published June 1, in a well known Canadian IT channel trade publication.
The article struck me in a couple of ways.
First, it was a rare direct shot from one of Ingram Micro’s largest, toughest, and most respected competitors, Tech Data. Typically, the Ingram Micro/Tech Data rivalry is very respectful. While we may disagree on strategy, course, and direction, you rarely see Ingram or Tech Data take direct shots at the other or call the other out in such an audacious manner.
We were surpirsed at the statement Greg Meyers, a VP of Marketing for Tech Data in Canada, made regarding Ingram Micro’s Seismic program. We were suprised simply because we don’t know Greg at all and he obviously was not familiar with Ingram’s managed services strategy.
The second thing about the article that struck me was that Tech Data basically admits they don’t see how distribution can add value in the largest IT growth opportunity in 20 years – managed services. Mr. Meyers states that “partners don’t want packaged services like Seismic,” and “[Tech Data’s role] is facilitator. We’ll direct our customers to those who provide managed services.”
We were stunned and dumbfounded. Ingram has over 1100 reseller partners consuming some or all of our Seismic platform of managed services and private-labeling those services under their own brands. Those services provide huge margins for our vars who partake of them. Ingram (and distribution) is well positioned to bring huge value to the table to not only assist our partners in selecting managed service partners, but also procuring, provisioning, billing, hosting, and managing many of those services in a private labeled strategy. 35-50 new reseller partners per month are becoming Seismic partners – who is Tech Data speaking to when they say partners are not interested?
I would also ask Greg, whom I don’t know, have never met, and have never heard of, what does he know about Seismic? He’ll probably take the time to understand it if he reads this, but when he made the statement I would guess he had very little, if any, understanding of the Seismic strategy, our platform, our services, or how we deliver those services for our vars. Could he name 3 of the offerings? Could he describe our Seismic partner community – 1100 strong? Doubtful. Which is what made his statements so confusing to us.
Saying distribution has no value in the delivery of infrastructure-intensive services is like saying distribution has no value in the delivery of IT products. Our role in the service delivery supply chain, if executed correctly, is very similar to our value in the physical product delivery supply chain. We can help our partners go to market with a comprehensive suite of services and eliminate the complexity tranditionally involved in selecting, procuring, managing, and delivering those services…..just like we do in product distribution.
Is Greg alone in his views or does Tech Data really just not get it? Either way, I would suggest that if Tech Data’s strategy, as Greg outlines it in the article, is simply to facilitate – point vars who are looking for managed services to those who provide managed services – I will offer Seismic as a preferred partner. Tech Data can send its managed services customers to us. We have 1100 reference accounts to back us up. We’ll take good care of your customers for you, Greg.
Filed under: Ingram Micro, IT Distribution, IT Services, Managed Services, marketing | Tags: marketing, sales, Seismic, Value Proposition
There is widespread agreement that managed services is an IT service delivery model that is here to stay. As with any other relatively new market, the SMB managed service space is highly fragmented with hundreds of existing application and service vendors and just as many new entrants to the industry competing for solution providers’ mind-and- market share.
A decade ago during the boom and bust of the dot com era, a similar landscape presented itself to IT solution providers. Many businesses made emotional or hurried decisions when it came to vendor and partner selection. Some businesses were swept away by fancy marketing, messaging, and branding campaigns by new entrants and fly-by-night dot-com companies. The results of many of those decisions are well documented.
The same caution and logic must be applied in todays highly fragmented, early stage managed services market. Many MSP’s, application providers, and service providers may not be what they appear or what their websites, blogs, and press releases claim. Because most of these early stage companies are privately held, it is hard to get detailed information about them to help you make buying decisions and partnership selections. Future success, stability, longevity, and financial solvency for these small players and new entrants may be challenging or downright bleak – and their management teams know it.
Here are four things those management teams may not want you to know about their operations:
4. I Run My Company with 3 People Out of a Van Down by The River
Small is no indictment of quality or financial stability. However, it pays to be diligent when making MSP provider or partnership selections. Does the potential provider or partner have a sustainable business model? Can they demonstrate financial solvency? Are they capitalized appropriately to grow as you grow? Can they support your needs long-term? Look under the hood and ask questions about how their business is built. If they refuse to answer your questions or provide vague answers, steer clear. They aren’t being specific because they know you won’t like the answers.
3. The Only Metric I Care About is My Revenue Multiple
There is certainly no crime in building a business to one day reap the rewards when you sell or merge that business. However, when the revenue multiple is more important than product quality, good support, or solid operating methodologies, that can cause problems for clients and partners. Again, ask some tough questions. How is the company financed? Who holds ownership positions – employees and owners or VC’s and private equity people? The answers will give you some indication of the time horizon that business is operating under. Beware of short-term thinkers and the churn-and-burn operators. Your best interests are secondary to theirs.
2. I’m A Solution Provider Just Like You (aka I Sell to End Users Too)
As a distributor, I get asked about selling to end-users every day by solution providers who are concerned that Ingram Micro will take their end-users direct. Yet those same solution providers have no qualms about doing business with MSP organizations that openly sell to end-customers. Those MSP organizations may even use the fact that they have end-user sales experience as a selling point in their messaging to attract solution providers as customers. If your partners and suppliers sell to end-users, they pose a potential competitive problem for you. Proceed with caution.
1. I Offer You Little Long-Term Value as a Partner
Do your homework. Look for substance beyond the bootcamp, blog, or white paper. Separate the spin from the reality. What does the potential partner offer you in terms of competitive advantage, long-term defendable value, or scale? How do they make your company better? How do they make you look bigger? How do they augment your capabilities? What can they help you achieve that you cannot achieve on your own or with anyone else? What is unique, lasting, or significant about their value proposition to you?
These are uncharted waters. Don’t navigate them alone. Call us to talk shop and help you make the difficult decisions critical to your success. www.ingrammicro.com/seismic
Filed under: Ingram Micro, IT Distribution, IT Services, Managed Services, marketing | Tags: marketing, Seismic, Value Proposition
Also published on MSPmentor.net on February 18, 2009 as monthly guest column contribution.
Generally speaking, IT managed service providers are technologists, both in training and previous professional pursuits. The managed services market is also highly fragmented, with a long list of small technology and software companies all battling for the attention and business of end users and IT service providers. The value focus in all of the selling and marketing efforts has resulted in a disturbing trend carried over from the hardware selling models: A focus on tools, technology, and features/functions.
Avoid this trap at all costs.
Here’s a newsflash: Only technology providers get excited about technology. The rest of the world just wants their IT problems handled so they can conduct whatever business they are in.
It is critical for successful managed service providers to stay above this fray and avoid the “speeds and feeds” trap that is so prevalent in IT marketing and solution selling. Tools are exactly that – pieces and parts of the overall finished service. Tools and technologies are not the services you are selling, nor are they the value you provide to your clients.
Your unique expertise and ability to deliver complex solutions to your clients, when added to the tools and technologies, is the service you deliver, and it is that expertise and unique value proposition you need to focus on when marketing and selling your capabilities.
Without question, the tools and applications you choose need to work and fit your business. Solid tools and strong technology is the foundation for any competent and quality service you deliver. However, too many MSP’s are focusing on and marketing the parts of their overall solution. For example, the reason an end client should choose you to provide IT systems management and support has nothing to do with the tools you use to deliver that capability. The assumption by the end user is that you can provide such a service – what do they care which PSA you have selected to run your business on? Yet many MSP’s still weave vendor literature and brands into their managed services marketing and selling materials and ignore the larger question: Why you over anybody else?
Don’t believe me? Who made the transmission in your car? Are you sure? Do you care? You want your car engine to perform, but you don’t really care who made the various parts, so long as the auto manufacturer stands behind the product, right? You are buying BMW, or Toyota, or Honda, or Nissan. You are buying the value proposition and brand promise that those various auto makers deliver. You are not evaluating the combined parts and components that go into those cars which are delivered or made by third parties.
End client prospects for IT services are evaluating their decisions in the same manner. They are looking to your brand, your value proposition, when making their decision. If your value proposition is on target, and you are able to differentiate your capabilities around delivering a high quality service at a fair price, the tools you use are your choice and are irrelevant to your end clients. So long as you ensure those tools work for you, they will work for your end clients.
Of course, Seismic offers the widest selection of tools and capabilities in the market. But if it’s your value proposition or brand promise you want to tune up, Ingram Micro can help provide market-leading expertise with that also.