One of the most common questions I get asked when speaking with MSPs is around pricing and packaging of the services they offer.
It’s a great question that generates a lot of different opinions. Most of the conversations fall into three categories:
Per User or Per Device
Yes, this old chestnut. I thought the battle had been won and it was per user all the way, but it turns out some MSPs still stick with per device. Well, if it ain’t broke don’t fix it I guess.
My argument has always been that per-user is the better option, after all it’s simple for the end user to know how many users they have. Also as more on-premises services have migrated to the cloud, the number of devices has reduced.
Perhaps most importantly in my mind at least, most of the services that MSPs purchase are user based so I assumed it would be better for reconciliation etc.
It always seemed more sensible to me, but I also know many successful MSPs who have a perfectly good experience charging per device.
To Bundle or Not to Bundle
The next decision we normally turn to is the issue around bundling. Some MSPs offer pretty much all of their services and products in a bundle, and well, some don’t.
An example might be wrapping up the Service Desk Support, Proactive Monitoring, Endpoint Protection, Email Content Filtering, and Office 365 into a single bundle. The advantage of this in my eyes is that it removes a lot of the individual pricing queries. If, for example, the bundle is $100 per user per month, then no one will question the price of the Endpoint Protection.
It also allows the MSP to swap out the services. The end user is really looking for outcomes, so offering endpoint protection is just that, they aren’t bothered as much about the brand as sometimes we, as MSPs think. Therefore it’s possible for you to switch suppliers of the service without it being a big deal.
Then again, some just offer the basic service and then have invoice line items for everything else.
In case you didn’t guess, I’m a fan of bundling. . .
To Publish or Not to Publish
This is perhaps the one we argue about the most – Do you publish your pricing on your website or not? I can see both sides of the argument here, but I fall very much into the “Yes – Do it” camp. My reasons being:
- When I am looking to buy something online and it says “contact for pricing”, it turns me off right away. I don’t want to speak to someone to get a price, I want to know the price. What are you hiding? That’s my thought.
- It’s a great way to self-exclude clients who don’t understand the value you offer. If, as per the example above, you are charging $100 per user per month and they were expecting to pay $15 per incident, once per year, then they probably won’t contact you. This will save you a lot of time and aggravation over the months and years.
- It will make you stand out from your competitors, yet most MSPs still don’t do this. If a prospect is looking at you and that other MSP down the street, you’re already in a great position as they will see you as being more transparent.
Of course I understand that some, well indeed most, MSPs don’t publish pricing, but I think for the time being at least doing it will help you stand out from the crowd. Some MSPs even put their contracts online so prospective clients can look at it before engaging. I love this openness.
Well, there you have it. I didn’t promise you answers did I? I hope this gives you the opportunity to reflect upon your current setup and maybe, just maybe consider making a change. Come discuss this with us over in the Community.