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Reap the benefits of managed service packaging

June 03, 2019
Packaging

Developing a go-to-market strategy can be challenging for IT providers. Many start out as break-fix shops, delivering IT support on a project basis. However, working from project to project makes revenue unpredictable. That’s why some providers make the move to managed services. In the managed service model, IT providers deliver services on an ongoing basis and charge customers on a subscription basis. Customers outsource all, or part, of their IT needs to the provider.

Some providers offer packages or groups of services. This gives providers an opportunity to present service options in a straightforward way. For example, a provider might offer tiers of services at different price points. Others create packages geared to meet the needs of a specific vertical, say healthcare providers, for example. Targeting specific IT disciplines is the most common approach. In this model, a provider might offer a security service package that includes firewall and antivirus, threat detection, and patch management.

There’s no single way to package services. The needs of customers in your region will dictate the exact makeup of the packages you offer.

Packaging offers a number of benefits, including increased efficiency, simplified pricing, and upsell opportunities.

Let’s start with efficiency, since it’s probably the biggest benefit. Obviously, the more customers an IT provider serves, the more revenue they bring in. The key is to be able to provide high-quality service to all of those customers. So, efficiency is essential. Service packages increase efficiency because you can standardize on specific products and develop expertise on them.

Let’s say you are providing backup services to 20 customers. Offering a standard backup package allows you to manage all of them using a single backup solution. Contrast that with trying to manage 20 disparate backup environments with a variety of different products. This is a simple example, but the benefit is obvious.

Next up, pricing. On your end, billing is greatly simplified since you don’t need to calculate different charges for different customers. For customers, it’s just a monthly fee that they can budget for. Many customers prefer this simplicity to a sea of line item charges. Especially in today’s services-centric economy.

And finally, upsell opportunities. Tiered packages allow you to take on customers that may have limited IT budget and grow with them as their needs change. For example, you might offer backup and business continuity. You might start a customer on cloud backup and as their needs change, shift them to a server failover service to reduce or eliminate downtime.