With 2017 firmly in the rearview mirror, it’s time to look ahead to what 2018 has in store for MSPs. With the majority of predicted trends actually being emerging trends from previous years shifting into gear this year, 2018 promises to be a year of acceleration. MSP success will mean keeping the pace with the increasingly rapid digital transformation of the market. Here’s a look at what we feel will shape the landscape this year.
In 2018, successful MSPs will…
…embrace the cloud in all its forms – public and private
Undoubtedly, the star of the show for 2018 remains the cloud. Cloud computing has seen continuous growth, and is predicted to continue to do so. Businesses of all sizes are expected to have the cloud at the top of their IT to-do list in 2018, with companies not on the cloud getting in on the action, and those already in the cloud game looking to expand their existing cloud integration. This means much challenges and opportunities for MSPs who embrace the cloud!
“Worldwide spending on public cloud services and infrastructure is forecast to reach $266 billion in 2021.”
The shift to SaaS obviously remains prominent, but PaaS and IaaS will surpass it as organizations start migrating from private cloud platforms to public cloud platforms such as Microsoft Azure. Cloud infrastructure is not merely for staging environments anymore with businesses now moving their production workload to the cloud. It is also expected that a large portion of IT spending will go towards upgrading end-of-life hardware. This too will provide MSPs with the opportunity to present cloud environments as potential future-proof solutions.
“Spending on Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) will grow at much faster rates than SaaS with five-year CAGRs of 30.0% and 29.7%, respectively.”
MSPs have and will continue to play a major role in the adoption of cloud services. Productivity applications like Office 365, among others, will continue to grow significantly as businesses embrace the full potential of the cloud. However, as platforms evolve and businesses look to reduce IT capital expense spending, MSP success will rest on staying at the cutting edge of cloud infrastructure innovations in order to provide customers with the best possible solutions.
…expand their offering to secure loyalty and revenue
2018 will be the year for complementary cloud solutions. An increased focus on business-wide integrated solutions will present special opportunities for MSPs to cross-sell to current customers. Offering a VoIP solution to an existing client to help them achieve their unified communication goals, for instance, will bring true value and help generate loyalty. “Sticky” products such as Online Backup and Dynamics 365 are easy additions to a cloud offering and will keep customers knocking on your door.
MSPs will also need to provide more tailored, industry-specific solutions in an environment where customization is becoming increasingly accessible to even smaller businesses. Differenciation will be key to MSP success as staying away from one-size-fits-all solutions will ensure customer loyalty and greater profits.
A recent BMC survey indicated that partners are the single most important external source of influence over an organization’s cloud strategy. Trust, reputation and reliability are major deciding factors for businesses when employing a managed service provider. This means MSPs will need to shift from a break-fix mentality to become strategic technology advisors in order to stay in the race.
“[…] partners are the single most important external source of influence over [an organization’s] cloud strategy.” [source]
…capitalize on IT security fallouts
Major security breaches plagued the IT landscape in 2017 and left it wounded. Therefore, it comes as no surprise that security will be a top focus in 2018, with many businesses looking to their MSPs to provide solutions that will keep intruders out, data safe and ensure employees are well informed when it comes to phishing scams. SMBs who have been handling security internally will also be looking for external help – creating yet more opportunities for MSPs. Backup, recovery, and business continuity will be the name of the game this year.
Another challenge facing MSPs is the proliferation of devices with mobility and BYOD on the rise. This increases the number of potential entry points for malware into a network via second and third tier connections. These connections are virtually impossible to manage in terms of security, which means that MSPs will have to be proactive in finding innovative solutions to identify weak spots in the networks they monitor. Network monitoring, as well as disaster recovery, will thus play a critical role in IT security.
“The DRaaS market size is estimated to grow from 1.68 Billion in 2016 to 11.11 Billion in 2021.” [source]
Again, MSPs who proactively package tailored solutions that address trending security threats will be guaranteed more revenue than those sticking to more generic offers. Microsoft has done this with the recent launch of Microsoft 365 that bundles Office 365, Windows 10, and Enterprise Mobility Services (EMS) to provide a consistent and secure experience across devices.
… put their marketing dollars towards digital
More than ever this year, MSPs will need to embrace and expand their digital marketing for customer acquisition. They will have to invest more in their online presence to make sure their name is out there, that they establish credibility and trust, and that they stand out with a distinctive value proposition.
MSPs who actively engage in lead generation to keep their sales pipeline full will ensure sustained growth. Simply relying on word-of-mouth referrals, and cold calling will not cut it anymore in an increasingly competitive market. This is especially true for MSPs achieving specialization as they narrow their local market while looking to significantly increase their global reach. Creating relevant and targeted marketing campaigns for lead generation will make the difference between expansion and stagnation.
Once they have a solid digital marketing strategy going and a steady lead flow, MSPs will get to focus on taking care of new incoming clients and not worry so much about how they’re coming in.
…leverage their vendor’s capabilities
Today’s MSPs are under a lot of pressure as customers, competitors, suppliers, and even employees, are evolving quickly. Getting help to tackle these challenges will be a key factor for success this year.
Leveraging existing vendor relationship will be a good starting point as most vendors deliver a variety of resources MSPs might be missing. Sales and marketing resources such as scoping guides, proposal templates and fact sheets can all be customized and branded. Vendors can also be instrumental in closing complex deals by bringing extra talents such as solution architects and various subject matter experts to the table.
All of these benefits can contribute in reducing the pressure and lowering the financial risks for many MSPs. There is a lot of value to be leveraged by simply engaging with a vendor. After all, they want you to be successful – it’s to their advantage!
On a final note, the key to MSP success for 2018 will be to stay ahead of the game. Don’t be too near-sighted but rather ask yourself who will you be competing with 2 years from now? Be creative. Be innovative. Success relies in constantly reinventing yourself.