Managed service providers (MSPs) are constantly seeking ways to differentiate themselves in a crowded market. One powerful way to stand out is by offering your own products. This article explores the benefits of creating your own channel offerings, guiding you through the development process and offering tips on how to promote your unique solutions. Whether you’re an established MSP or a newcomer, crafting your own products can set you apart and drive growth.
Featured Partners: Managed Service Provider (MSP) Software
What is a custom channel product?
A custom channel product is a unique, purpose-built solution that addresses specific needs within your target audience. Custom channel products can range from software platforms to integrated hardware solutions or specialized service packages. Their key distinction is that you create and own the product, giving you greater control over the offering and its revenue potential.
By developing these products in-house or partnering with a Product Development as a Service (PDaaS) provider, you maintain full intellectual property rights, enabling you to tap into new client segments and continuously refine your offering. This approach to product development opens up a world of opportunities for your organization, each with its own set of compelling advantages.
8 benefits of a custom channel product
In today’s fiercely competitive MSP landscape, standing out from other service providers is more crucial than ever. While many MSPs focus on reselling vendors’ off-the-shelf solutions, forward-thinking MSPs are discovering the transformative power of building and promoting their own offerings. Custom channel products aren’t just a way to differentiate your business; they’re a strategic tool that can reshape your business model and propel your growth to new heights.
Creating one or more custom channel products offers numerous advantages that can benefit your business in the following ways:
- Differentiation in a crowded market: Custom products set you apart from competitors who rely solely on reselling standard solutions. This unique offering can be a powerful selling point when pitching to potential clients.
- Client relationship enhancement: Providing a custom solution deepens the relationship between your MSP and your clients, positioning you as a strategic partner rather than just a service provider.
- Increased customer loyalty: By providing solutions tailored to your clients’ specific needs, you create a stronger bond and increase the likelihood of long-term relationships. Clients are less likely to switch providers when using a custom solution that integrates deeply with their operations.
- Scalability: Once developed, your custom product can be scaled across multiple products with minimal additional cost, enabling you to grow your business more efficiently than reselling products from a third-party vendor.
- Higher profit margins: While developing custom products requires an initial investment, they often yield higher profit margins compared to reselling third-party solutions. You have control over pricing and can capture more value from each sale.
- Recurring revenue streams: Custom products, especially those offered as a service, can generate predictable, recurring revenue. This stable income can help you smooth out cash flow and support long-term business planning.
- Intellectual property ownership: Custom products become valuable intellectual property assets for your business. These assets can increase your company’s valuation and potentially open doors for a multitude of partnerships or acquisitions in the future.
- Continuous improvement: Direct feedback from clients lets you continuously improve your products to enhance your offering and improve the client experience within your account base, ensuring your offering remains relevant and valuable over time.
By developing your own product offering, you can transform your MSP from a commodity service provider into a trusted, collaborative partner to strengthen your market position, improve your financial performance, and build a more resilient business model. You’ll also be more apt to attract top talent and potential investors who are drawn to forward-thinking, product-driven companies.
Use cases for custom channel products
The versatility of custom channel products opens up a wide array of opportunities within the IT sector. From industry-specific solutions to advanced security management tools, these offerings address diverse market demands that differentiate your organization, create new revenue streams, and deepen your client relationships in the following areas:
Vertical-specific solutions
By developing custom products for specific industries like healthcare, finance, or education, you can position yourself as a verticals specialist who can address unique regulatory requirements, workflows, and challenges within each vertical. With a focus on one or more industry segments, your solutions can command premium pricing, building long-term partnerships with clients who view them as indispensable to their operations.
White-label services
Creating custom products that other service providers or resellers can rebrand and sell as their own enables you to expand your reach without direct marketing costs, helping smaller providers to offer enterprise-grade solutions under their brand. White-label products enable you to create your own channel partner program and generate a new revenue stream with potentially high margins by catering to multiple resellers and leveraging economies of scale.
Integration platforms
Custom integration platforms that connect various tools and systems can be a game-changer for clients struggling with disparate technologies. By developing products that seamlessly link CRM, ERP, and other critical business applications to enhance operational efficiency, you not only solve immediate client pain points but also position your firm as a strategic partner in their digital transformation journey.
Compliance management tools
With increasing regulatory pressures across industries, you can offer custom compliance management products that help clients navigate complex regulatory landscapes, manage audits, and maintain necessary documentation. By offering these specialized tools, you’re in an excellent position to tap into the growing compliance market and become a trusted advisor in risk management and regulatory adherence.
Predictive maintenance solutions
Custom predictive maintenance products can be highly valuable to your clients for forecasting equipment failures and reducing downtime and maintenance costs. By helping clients transition from reactive to proactive maintenance strategies through the use of data analytics and IoT sensors, you can demonstrate tangible ROI and solidify your brand.
Data analytics solutions
Through the development of custom data analytics solutions, you can address a wide range of client needs, from customer acquisition and operational efficiency to security compliance and financial management. By leveraging technologies such as AI and machine learning, you can create unique, value-added services that differentiate your firm and provide your clients with powerful insights to drive business growth and optimization.
Security information and event management (SIEM)
Custom SIEM products tailored to specific threat landscapes and client environments can significantly enhance an MSP’s security offerings. These tools provide real-time analysis of security alerts generated by applications and network hardware. By offering customized SIEM solutions, MSPs can address the ever-growing cybersecurity concerns of their clients, potentially opening doors to lucrative managed security service contracts.
By focusing on these specialized application areas, you can enhance your value proposition, attract new clients, and foster stronger, more profitable relationships with existing ones.
7 steps for building a custom channel product
Developing a custom channel product requires careful planning and execution. We spoke with several MSPs to gain their insights and experience and stilled them down here in a step-by-step guide to help you navigate this process:
- Identify market needs: Conduct thorough research to uncover unmet needs or pain points in your target market. Engage with existing clients, analyze industry trends, and look for gaps in current offerings.
- Define product concept: Based on your research, outline a clear concept for your custom product. Define its core features, target users, and how it will address the identified market needs.
- Assess feasibility: Evaluate the technical and financial feasibility of developing the product. Consider your team’s capabilities, potential partnerships, and the investment required.
- Create a development plan: Outline the development process, including timelines, resource allocation, and key milestones. Decide whether to develop in-house or outsource certain aspects.
- Build and test: Develop a prototype or minimum viable product (MVP) and conduct thorough testing. Involve beta testers from your target market to gather real-world feedback.
- Refine and iterate: Use the feedback from testing to refine the product. Be prepared to iterate multiple times to ensure the final product meets market needs effectively.
- Prepare for launch: Develop documentation, training materials, and support processes. Create a marketing plan and prepare.
5 ways to promote a custom channel product
Once you’ve developed your custom channel product, effective promotion is crucial for its success. Here’s a five-step marketing plan tailored to build your brand:
- Define your target audience: Identify the specific market segments that will benefit most from your custom product(s). Understanding your audience is crucial for crafting targeted marketing messages.
- Develop a compelling value proposition: Develop content that explains how your custom product solves specific problems and adds unique value for your target clients. Your content should focus on the outcomes and benefits of your offering, not just its features.
- Create educational content: Develop whitepapers, case studies, and blog and social posts that demonstrate your product’s value. Use these marketing assets to establish thought leadership and attract potential clients searching for solutions.
- Leverage digital marketing: Utilize SEO, content marketing, and targeted social media campaigns to reach your audience. Consider using paid advertising on platforms like LinkedIn, GitHub, Stack Overflow, YouTube, and others where your target clients are active.
- Engage in industry events: Participate in relevant trade shows, conferences, and webinars to showcase your custom products. These events provide opportunities for direct engagement with potential clients and industry influencers.
By using a combination of paid search, SEO, events participation, and other forms of digital marketing, you can build a following for your offering among new and existing clients. During the process, be sure not to overlook the potential of promoting your branded products to your current client base through personalized outreach and targeted upselling strategies.
Bottomline: Gain a competitive edge with custom products
Offering custom channel products demonstrates your expertise and commitment to innovation and positions you as a valuable strategic partner rather than a mere service provider. While the process of developing and promoting your own products requires investment and effort, the potential returns in terms of market positioning, client loyalty, and financial performance make it a strategy worth considering for thriving in an increasingly competitive market.
While developing custom channel products can elevate your MSP business, it’s just one piece of the growth puzzle. To maximize your market impact, explore a complementary, powerful approach to selling that can transform how you engage clients and close deals.
FAQs
Here are some common questions about building and promoting custom channel products:
What is IT channel marketing?
IT channel marketing refers to the strategies and tactics used by technology vendors and service providers to promote and sell their products or services through various distribution channels. These channels typically include resellers, distributors, managed service providers (MSPs), and other intermediaries who help bring the product or service to end-users.
How does a business market a product?
A business markets a product through a combination of strategies, including the following processes:
- Identifying target customers
- Developing a unique value proposition
- Choosing appropriate marketing channels (e.g., digital marketing, traditional advertising, direct sales)
- Creating compelling content and messaging
- Implementing promotional activities (e.g., discounts, demos, free trials)
- Analyzing and adjusting marketing efforts based on results
What is a channel strategy for a product?
A channel strategy for a product is a comprehensive plan that outlines how a company will distribute and sell its product to end-users. It involves selecting the most effective combination of direct and indirect sales channels, such as direct sales teams, online marketplaces, reliance and resellers, or distributors. The strategy also includes how to manage these channels, provide support to them, and align channel activities with overall business goals.
What is an MSP go-to-market strategy?
An MSP go-to-market strategy is a plan that outlines how an MSP will reach its target market and achieve a competitive advantage. This strategy typically includes the following processes:
- Defining target customer segments
- Developing a unique service offering
- Setting pricing and packaging strategies
- Establishing sales and marketing channels
- Creating a brand positioning and messaging framework
- Implementing lead generation and nurturing processes
- Defining metrics for measuring success and adjusting the strategy
What is the MSP business model?
The MSP business model is centered around providing ongoing IT services and support to clients for a fixed monthly or annual fee. Key elements of the business model include:
- Proactive monitoring and management of client IT infrastructure
- Remote support and problem resolution
- Regular maintenance and updates
- Cybersecurity services
- Cloud services management
- Strategic IT consulting
- Scalable service offerings to meet diverse client needs
- Emphasis on long-term client relationships and recurring revenue
This model allows businesses to outsource their IT needs, benefiting from predictable costs and access to specialized expertise, while MSPs benefit from stable, recurring revenue streams.