MSP BUSINESS MANAGEMENT WEBINAR

Gordon Tan

Gordon@clientheartbeat.com

INCREASE RETENTION AND BUILD ‘STICKY’ CLIENTS

AGENDA

1. Identify unhappy clients2. Stop clients from defecting3. Strategies to increase client retention4. MSP service benchmarks5. How R&G grew revenue (and profits) by focusing on

retention

Customer Satisfaction?

As defined by Gallup Organization is:

1. Accuracy2. Availability3. Partnership4. Advice

How much does it cost?

Losing just one $1,500 contract each year for 4 years and you will lose $180,000 in revenue.

The average MSP currently has just over 12% of their clients “not satisfied” – or open to competitive offers!

1. IDENTIFY UNHAPPY CLIENTS

• Before you can increase client retention, first you need to identify which clients are unhappy

• Then, find out why are they unhappy?• Establish a baseline for your service so you can track

improvements

1. IDENTIFY UNHAPPY CLIENTS

• Regular onsite IT meetings• Ticket closing surveys • Quarterly customer feedback surveys

• Trend results• Has client gone quiet?

2. STOP CLIENTS DEFECTING

• Once you know a client is unhappy, you need to implement programs to stop them from defecting.

• The most successful MSPs have formalized procedures for winning back unhappy customers

• Here’s how we do it at R & G….

WINNING BACK A CLIENT

1. Identify unhappy client through surveys2. Call client immediately and arrange face to face

meeting3. Add them to a “Customer Watch” list4. Organize a team meeting with staff to discuss

possible causes of issues5. Meet with customer6. Propose a "customer win-back" plan – do you need to

make some concessions? Can they be “Win-Win”?7. More communication is often key! 8. MAKE SURE YOU DELIVER ON YOUR PROMISES

Here’s an example

1. Client was managed services paying us $4,200 a month – very demanding (by our standards)

2. Client gave us poor heartbeat scores – dropped significantly

3. Added them to our “Customer Watch” list4. Organize a team meeting with TAM to discuss

possible causes of issues which were highlighted as:- A couple of stuff ups on our end- Communication from the client- Client was more demanding than a traditional client

Here’s an example

5. Met with client on-site6. Explained our situation and our solution:

- Accepted responsibility for stuff ups – offered to fix for free- Weekly phone call with the client- Increase our service agreement for the additional demands

7. The result was client is now happy and we increased contract by $1,300/mth

3. STRATEGIES TO INCREASE CLIENT RETENTION

• Identify the baseline and then work on improving Accuracy and Availability first.

• Charge more!• Create a “customer intimacy” initiative for 2014

• Quarterly Business Reviews• “Laptops and Lunch”• Webcams• More regular feedback processes

once or twice per year or ad hoc surveys are not what the BIC companies do!

3. STRATEGIES TO INCREASE CLIENT RETENTION

Create a customer oriented cultureCulture is “social control” – sets of information used to determine what behaviors are appropriate in the absence of procedures

1. Get management buy-in2. (Re-)define values3. Align incentives4. Make at least 1-2 “symbolic”

changes 5. Talk about it until bored6. Hire/Fire against cultural fit7. Celebrate and reward people who exhibit values

3. STRATEGIES TO INCREASE CLIENT RETENTION

• Offer a service that extends beyond your bare product• Be their trusted ‘IT expert/advisor’• Stickiness by layering products together

• Be prepared to cut lose-lose clients• Set better customer expectations during onboarding • Show that you care by remembering special occasions• Have a regular service improvement focus through

gathering feedback each quarter

4. SERVICE BENCHMARKS – Why is it important?

• Benchmarking is about finding the best “bang for your buck” for resources you will invest eg. Where will my resource investment create the most value for my business

• Study by The Dunvegan Group shows 9% of your clients will leave simply because they perceive a competitor offering to be better. Our data shows the same….

• Because becoming best in class (BIC) creates enormous value for your business

Some more reasons to be “Best In Class”

• BIC companies have 70% better retention rates than average MSPs

• BIC companies are growing on average at 30% pa.• BIC companies are getting more referrals• BIC companies can charge higher prices for their

services

MSP SERVICE BENCHMARKS

ACCURACY (attention to detail)8.1 out of 10 // 8.6 out of 10

PROMPTNESS (response times)8.0 out of 10 // 8.4 out of 10

PARTNERSHIP (collaboration)8.6 out of 10 // 9.3 out of 10

HELPFULNESS (advice and consulting)8.7 out of 10 // 9.5 out of 10

5. R&G INCREASED REVENUE BY FOCUSING ON RETENTION

• As of last quarter, R & G has finally reached BIC satisfaction levels for a company of our size in Australia

• This process has taken 12 months (4 quarters of constant analysis & improvement)

• Total Revenue increased by 25% last FY – MRR by 40%

• We are now able to charge more, and are more profitable

5. R&G INCREASED REVENUE BY FOCUSING ON RETENTION

How we did it

1. Implemented Client Heartbeat to get baseline and get quick wins

2. Increased price3. Cut customers where it was “lose-lose”4. Culture5. Implemented customer intimacy initiative6. Quarterly Client Heartbeat meetings

CLIENT HEARTBEAT

1. Gather client feedback

2. Improve client satisfaction

3. Retain more clients

Used by over 400 MSPs bigand small

Integrates with CW & Autotask

1. GATHER CLIENT FEEDBACK

Simple, personalized email surveys – with automated email follow-ups

Industry high survey response rates (60%)

Runs on autopilot

Passes all feedback into a simple dashboard

2. IMPROVE CLIENT SATISFACTION

Track and monitor changes in satisfaction on an individual client level and on an overall company level

Benchmark satisfaction against other companies in your industry

3. RETAIN MORE CLIENTS

Client Heartbeat uses past scores and industry data to identify unhappy customers

Get instant notifications so you can proactively follow up, address concerns and retain their business

4. COLLECT TESTIMONIALS

If we detect positive feedback we’ll ask for testimonials and collect them automatically

The client can also share these to their social media

SPECIAL FOR THIS WEBINAR ONLY

Receive a 30% life-time discount on Client Heartbeat

1. Create an account2. Email ross.beard@clientheartbeat.com with account

details3. Account must be activated by December

QUESTIONS AND ANSWERS

Questions?

INCREASE RETENTION AND BUILD ‘STICKY’ CLIENTS

Gordon TanGordon@clientheartbeat.com

Thank You