Why a Competitive Offering Is a Key Factor in Customer Retention

In recent years, small and midsize businesses have realized the importance of robust cybersecurity but most still consider it the biggest challenge they face. This is why many of them rely on managed service providers (MSPs). When choosing an MSP, enterprises are not only looking for protection but also want IT teams to focus on innovation and tasks that deliver value to the business. Placing the administration of infrastructure and systems in the hands of qualified professionals not only ensures a secure environment, it also optimizes resources and reduces IT costs, which avoids any unpleasant budgetary surprises.

Earlier this year, the analytics firm Canalys warned that 34% of partners expect a year-over-year rise of 20+% in their cybersecurity revenue by 2024, while nearly two-thirds anticipate growth of 10% or above. This data highlights the growing importance this service now carries for MSPs. Analyst Robin Ody commented that cybersecurity has revolutionized the managed services arena, affecting both the services that partners can offer and the complexity of solutions delivered to customers. However, he stressed that relatively few partners can provide end-to-end services. 

Limited offering: the Achilles heel of MSPs

It is estimated that a quarter of the small and midsize businesses that decided to stop working with an MSP did so because their needs exceeded what that MSP could offer . The remaining 75% ended their partnerships due to high costs, bringing IT in-house, or having a poor experience with the sales team or customer service, according to data from JumpCloud. This flags the importance of maintaining an up-to-date offering that adapts to changing customer requirements and demands.

A limited offering can have a negative impact on MSPs and can lead to: 

• Loss of customers: a limited offering can cause MSPs to lose business opportunities if they cannot meet all the needs of their current and potential customers. This not only affects their ability to retain customers, but also reduces their attractiveness to new markets, thus limiting their growth and competitiveness in an increasingly demanding environment.
• Lack of competitiveness: MSPs that do not expand their offerings run the risk of falling behind competitors that do, compromising their market position. According to several studies, higher competition in the MSP market is one of the sector's main concerns. To stay relevant, MSPs need to diversify their services and adopt innovative solutions to differentiate themselves, attract new clients, and ensure long-term growth.
• Reduced adaptability: The lack of a diversified offering limits MSPs' ability to adapt to new trends and technologies, which can lead to accelerated obsolescence. Keeping abreast of the latest technological innovations is one of the main challenges MSPs face today, and failure to do so may compromise market relevance.
• Dependence on a few services: With limited supply, MSPs are heavily dependent on a few services, which increases the risk if demand for those services decreases. This lack of diversification can make their business more vulnerable to changes in the market and fluctuations in client needs, compromising their long-term stability and growth.
• Reduced revenue: By not offering a full range of services, MSPs may see reduced revenue potential, as they fail to take advantage of all cross-selling and upselling opportunities. This limitation prevents them from maximizing the value of each customer, directly affecting their profitability.

How can you make a competitive and up-to-date offering?

The answer to this question is simple. To maintain a competitive offer that aligns with the current cybersecurity landscape, it’s crucial to integrate advanced detection and response technologies. Adding a solution like WatchGuard’s ThreatSync+ NDR to your portfolio provides you with full visibility into risky activities across distributed networks, allowing you to quickly identify unprotected or malicious devices, as well as threats to IoT devices.

Additionally, automated and continuous monitoring enables you to detect and stop threats in real time, significantly reducing the dwell time of cyberattacks. Its scalability and automated compliance processes also allow you to quickly adapt to your clients’ evolving needs and market demands. This ensures you can tackle the latest security challenges, improve operational efficiency, and cut costs. Ultimately, these capabilities not only help you retain existing customers but also make you more appealing to new ones, ensuring your growth and competitiveness in an increasingly demanding environment.