Successful managed services marketing is dependent upon getting your pricing right. Cloud services, in particular, are increasingly in demand. However, because margins are sometimes thin, accuracy in pricing is imperative.
ChannelPro-SMB publisher Michael Siggin, along with guest experts Earle Humphreys (CEO ITEEx) and James Gaskin (a technology author, consultant, and speaker), recently held a webinar that spelled out two fundamental options:
1. Cost-based approach. You determine how much it costs you to deliver your service and then you factor in a profit margin. As long as you actually make sales, then by definition, you’ll be making a profit.
2. Competitor-based approach. You look at what other providers are charging for cloud services and set your pricing at somewhere within that range.
These choices could apply to other managed services marketing as well, but there’s a third one hidden in the presentation that deserves more emphasis.
3. Value-based approach. The big difference compared to the two above is that you look at what your customers want, what value they see (or not) in your cloud services, and what they’re prepared to pay.
A quick read through the presentation (PDF) could pay you dividends if you’ve been wondering how best to approach this kind of managed services marketing.
Start with value-based pricing (C), then check what you’ve found against cost-based pricing (A) and competitive pricing (B).
If necessary, define a couple of options to your service offering, while still keeping it simple. Then you can sell the full service to customers who see value in all of it, without losing sales to those who only want to pay for a more basic version.
And to follow-through on the tips introduced in this short article, be sure to watch the Inbound Revenue Acceleration Webinar for Managed Services & IT Consulting.
Creative Commons Image Source: flickr liewcf