Sept/Oct 19 - ChannelVision Magazine

Feedback was similar when MSPs were asked specifically about what they value in a security vendor. A su- perior product was most important to most MSPs, with 68 percent ranking this option as an 8, 9 or 10 out of 10. “It’s not surprising considering that security has become one of the main reasons why an MSP could lose busi- ness from one of its customers,” said CPI researchers. Ease of use for the customer and less competition from a security vendor’s direct sales team were close runners up in the feedback from MSPs, show the findings. Turning to backup/business conti- nuity and business software, respons- es reveal a set of different trends. When it comes to these product areas, attaining customer loyalty was seen as the most valuable factor for MSPs choosing a vendor partner. For backup and continuity specifical- ly, 16 percent of respondents scored “repeat business opportunity” a 10 out of 10, while MSPs said gaining a “high recurring revenue opportunity” was the most attractive asset a soft- ware vendor could provide, with 21 percent of respondents scoring it a 10 out of 10. For both software and backup technologies, the second-highest rat- ing was centered on how the product adds value to the customer. “Software that will help customers save money and streamline processes” was the second highest-scoring option out of six possible selections in terms of what MSPs value when choosing a software partner. A full 80 percent scored it a 7 out of 10 or higher in importance, and 16 percent gave this option a 10 rating. Similarly, “ease of use for the customer” scored the second highest when we asked about backup and business continuity ven- dors. Some 69 percent scored this option a seven out of 10 or higher with 16 percent giving a it 10 out of 10 score, show CPI’s findings. Moving to internal operations, the survey also asked MSPs to con- sider value and needs when choos- ing an RMM (remote monitoring and management) or PSA (professional services automation) vendor. “In these cases, ease of doing business emerged as the most vital attribute,” said the study. For RMM vendors, more than half of respondents (55 percent) scored ease of doing business as an 8, 9, or 10 out of 10, with 13 percent giving it a 10. Similarly, when asked about PSA vendors, 49 percent of respon- dents thought ease of doing business was worthy of an 8, 9 or 10 out of 10 score, with 13 percent scoring it a 10. Perhaps surprisingly, said CPI researchers, the option “low costs” received a mediocre reaction from respondents, with most rating it a 7 or 8 out of 10. MSP participants were also asked to evaluate partner programs more generally. The result: “it’s all about margins,” said the study. Out of six possible options, (rebates, certifications and training, marketing support, better margins than other vendors, face-to-face sup- port and continued investment in the partner program), “better margins than other vendors” was the runaway most valued perk among our MSPs,” said CPI researchers. Sixty-nine percent of respondents scored better margins a 7 out of 10 or higher, with 13 percent giving it a 10 out of 10 rating. Arguably the least valued practice or incentive among MSPs is rebates, suggest the findings. Less than 5 per- cent of respondents scored rebates a 10 out of 10 score for value, while 7 percent gave it a 1 out of 10 score, and 44 percent scored it a 5 or lower. “Rebates are widely considered a valuable incentive for product-centric resellers, but this clearly isn’t the case for MSPs, who likely put a higher value on recurring business,” concluded the study. In the end, vendors looking to bet- ter help and support the growing num- ber of MSPs should be mindful of the changes and challenges they face as they switch to true recurring revenue models. MSPs certainly are feeling pressure to make the move, but it can require investments in systems, process and people and changes to billing and sales commissions that can put a strain on profitability. “Going from chunky product deals to monthly annuity changes the dy- namic of a business for the better in the long-term, but it brings short-term cash flow challenges,” replied one MSP. “So honesty and openness are key.” o channel management Source: Channel Partner Insight, MSP survey What do you most value in your vendors’ MSP programs? (where 1=not important at all, 10=extremely important) Source: Channel Partner Insight, MSP survey Better margins than with other vendors Rebates 25% 20% 15% 10% 5% 0% 20% 15% 10% 5% 0% 1 10 38 Channel Vision | September - October, 2019