Demystifying Lead Gen in the MSP Marketspace

What is Lead Gen?

“Lead Generation”, or “Lead Gen” for short, is the process of identifying and cultivating potential customers for a business's products or services. It is essential for businesses as it can turn interested parties into paying customers which in turn helps to create a stable customer base and drive sales, this then creates an ongoing cycle where customers give good reviews, which in turn results in customer loyalty and new business from that.

Lead Gen also allows for a better understanding of a company's key customers and target markets, their needs and preferences thus allowing for more personalisation of products, services and marketing communications.

Outsourcing and Lead Gen

Outsourcing Lead Gen is a hot topic (and a contentious one) in the MSP community and one I frequently asked about. ?In short (well long) it can be both beneficial and challenging, depending on multiple factors. But a lot of it comes down to you and your choices, here is a quick overview of the general pros and cons and then I’ll chat about MSP-specific benefits and disbenefits after.

Pros of Outsourcing Lead Gen:

1.????Cost Savings: no in-house team required, less investment in hiring, training, and managing staff.

2.????Instant Expertise: Access to professionals with extensive experience and knowledge in lead generation and the latest learnings.

3.????Scalability /Flexibility: Businesses can upscale as needed and downscale as flexibly as required, valuable when just starting or entering new markets.

4.????Better use of resources: Businesses can focus on their core strategic initiatives rather than dedicating time and effort to lead generation activities.

Cons of Outsourcing Lead Generation:

1.????Poor quality leads: Due to a lack of understanding of the business's needs or poor selection of the provider or not allocating enough budget, this is the no.1 pitfall.

2.????Communication Challenges: Working with an external team can sometimes lead to communication issues, especially if there are cultural or language barriers.

3.????Data Security and Privacy Concerns: Sharing sensitive customer data with an external service provider introduces potential risks to data security and privacy. Businesses should establish clear protocols and agreements with the service provider to mitigate these concerns

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Selecting the right Lead Gen providers

When looking for any Lead Gen providers, it’s important to understand it costs real money and there are no magic beans for a shortcut. You are selling a complex solution, not a simple transactional process, and these are very different ballgames.

When you start on the process, the costs are around ￡1500 per lead for MRR ?? (Monthly Recurring Revenue) support contracts. However, this will drop as data gets better and you become better known to your provider/customers and vice versa.

My Top tips;

1.????You need to be very specific about who you want to sell to and what you are selling. Sales is a moment in time, so you need to be there at that moment in time, which will require nurturing 'interest' until the moment in time.

2.????Unless you are selling transactional products, you are unlikely to find someone today who is looking to buy tomorrow. The agencies generally do not understand this (or care..)

3.????If you want a 'Lead gen' company for selling complex solutions, then you are looking for a different type of service. This will need to be calling and developing a relationship over time, 6-12 months at least.

4.????Be aware that buying appointments is generally just a waste of money and simply helps the agency keep its data up to date.

5.????There is a massive difference between “recommendation and referral” and “selling deliberately”. R&R tend to be ready to buy, and you are halfway there having had the referral. SD means reaching out in the dark and finding prospects, and developing them into the light before you can sell them anything.

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The Managed-Service-Provider (MSP) Marketspace and Lead Gen

Generally, The MSP community is not sales experienced and therefore is slightly naive when it comes to sales and sales processes. This can lead to a lack of understanding of Lead Gen. Picking up the phone and contacting an agency and expecting them to collate a database of people looking to buy straight away might work in some industries but not the MSP space.

Lead Gen agencies typically sell appointments, and for them, if they get the appointment, it is a success but then the lead is most likely someone interested in buying, but in a year or more, therefore the MSPs who are expecting to be able to spend money on telemarketing and then produce instant business are always unhappy with the results that they get. Sales is a moment in time and they are rarely going to turn up in that moment in time having just been simply found.

Therefore, the expectations of the MSP IT company and the delivery from the telemarketing agency are almost without exception at odds with each other, and this is because one is selling appointments and if they get an appointment, they think it's a good job, and the other (MSP) is looking for almost ready-made orders. That said, the appointments typically will turn to business at a point in the future but during that time the lead will need to be nurtured and looked after and a relationship built and trust built. It is not a quick result.

So, what should I look for?

What you should be looking for is for a Lead Gen company to come up with recommendation and referral leads not simply leads. The big difference is that a simple lead is “somebody is interested in looking for something at some point in the future” and a referral lead is coming from “somebody who is looking to buy it now”.

Therefore, a good Lead Gen agency should understand the difference between these leads and fully understand the needs of your business now and in the future to be able to offer a successful and mutually satisfying Lead Gen solution and results.

Lead gen is not a mystic art. There is no magic involved. Just careful planning with regards to time and context and then execution. The quicker you want it, the more expensive it is.