How To Create A Roadmap To Get More High Value Managed Services Revenue

What I am going to cover in this post is primarily targeted at professional services businesses and consultants that rely on commissions for a huge chunk of their revenues, but who need more ‘maintenance’ type agreements for managed services.

However, if you don’t rely on commissions there are still some things you can take away and implement in your business.

To start off with, there is one fact you need to be clear of and which the big consultancies have nailed…

Life is more difficult when you rely on commissions than if you sign clients into multi-year, managed service agreements. And this all comes down to…relationships!

You are less likely to get clients moving to managed service agreements if you have not made the effort to get them to trust you in the first place. Commission or transaction-based revenue, or short contracts with specific results, tends to be the general outcome if people do not trust you. There is a caveat here – there will be many people in, for example, the financial services industry who will argue that their business model is based on commissions. I have a three points to respond to that:

  1. If you can convince someone to pay you for a managed service that rolls on year after year, you are less likely to lose them as a client because they should be clear about the benefits that result from the service you provide.
  2. The UK Financial Services Authority (FSA) is looking to abolish commission-based payments as it tries to move the financial services industry towards a services-oriented culture. The need to change the culture from sales to service is not unique to financial services. More clients and prospects expect more from their professional services providers, and know they can choose someone else if you don’t deliver more than just the basic transactions.
  3. If you can’t provide a managed service for whatever reason, then thinking about how you can package offers to clients is increasingly going to be key. Think about what Tesco does. You get their credit card, and start getting information about insurance, loans, etc. You need to know who you can partner with to at least create something that adds value to the basic service you may provide.

What has all this got to do with client attraction and growing your business? Everything, and if if you look at my other posts, you’ll know why this is the case. Basically, the steps you need to go through to increase the chances of getting more revenue via managed services are:

  1. Install a system to get clients to opt-in to receive information you have. This is crucial, as they are the ones who have made a decision to follow you and are interested in what you have to say. They are warm prospects! And always remember to use direct marketing principles to get specific responses.
  2. Build a position of authority and trust by providing free information via blogs, reports or webcasts to show prospects how they can eliminate their fears and frustrations.
  3. Provide a product (e.g. report) or series of information seminars that prospects would gladly pay money for, and which give more specific guidance on how to take away pain or achieve a desired outcome. Remember, people will always pay for information if they feel it is valuable and will take away their pain or improve their lives.
  4. Create a range of managed service options and highlight the benefits each provide to clients, again focusing on client emotional maps and not just facts.
  5. Be very clear on how clients would benefit from having a long term business relationship with you. Think about the offers or guarantees you need to provide to overcome resistance, and the benefits that would result for clients if you upsold them to additional services.
  6. Again, use direct marketing principles in your client communications to collect feedback and address any key issues they still have. Any collateral you send to clients should positively reinforce their decision to purchase from you in the first place.

Now, each of the points above would have a subset of activities that you need to focus on, but you get the general idea. The Magneto Effect helps professional services businesses increase client attraction using a roadmap that incorporates all the points I have outlined. The end result is that you attract more lucrative clients who are willing to pay for managed services that take away their pain and provide tremendous value.

So, if you rely too much on commissions, or transaction-based revenues, then as a professional services business or consultant, you really need to ask yourself whether this is where you want to be. If not, take action now!

Be Sociable, Share!

Leave a Response