MSP State of the Union 2012 | Global Pricing Benchmark Survey and Results
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The document presents insights on MSP pricing models based on a 2012 survey of 3,500 respondents across 29 countries, highlighting the evolution of pricing strategies among MSPs. Key observations include a preference for bundled services, geographic influences on pricing, and a trend towards value-based pricing for higher profits. Additionally, it emphasizes the superiority of world-class MSPs in terms of revenue growth, service delivery quality, and client retention.
![How Does Your MSP Pricing Model
Compare With Your Peers?
State of the Union [2012]
10 Observations from an Industry Leader
Kaseya [David Castro]](https://image.slidesharecdn.com/mspstateoftheunion-globalpricingbenchmarksurveyandresults-121203112509-phpapp02/85/MSP-State-of-the-Union-2012-Global-Pricing-Benchmark-Survey-and-Results-1-320.jpg)
MSP State of the Union 2012 | Global Pricing Benchmark Survey and Results
- 1. How Does Your MSP Pricing Model Compare With Your Peers? State of the Union [2012] 10 Observations from an Industry Leader Kaseya [David Castro]
- 2. Erick Simpson Erick Simpson Vice President & CIO, SPC International Vice President & CIO Mr. Simpson is a recognized IT and Managed Services SPC International Author, Speaker and Trainer, and contributor to www.spc-intl.com numerous industry publications and events. Author of "The Guide to a Successful Managed Services Practice", the definitive book on Managed Services, and the follow- • Over 20 years experience in the IT ups in MSP University’s Managed Services Series “The industry Best I.T. Sales & Marketing BOOK EVER!” and “The Best • Microsoft MCP, SBSC I.T. Service Delivery BOOK EVER!”, as well as his newest book “The Best NOC and Service Desk Operations BOOK • Author, Speaker and Trainer EVER!”, Erick has also co-authored the HTG publication “Peer Power – Powerful Ideas for Partners from Peers”. • Built Call Centers and Service Desks for Erick's prior experience includes overseeing the design, Fortune 1000 Organizations development and implementation of Enterprise-level Help Desks and Call Centers for Fortune 1000 organizations.
- 3. David Castro David Castro Director, Partner and Service Provider Marketing Kaseya Director, Partner and Service Provider Mr. Castro drives the Kaseya partner and service Marketing, Kaseya provider go-to-market strategy and leads all marketing www.Kaseya.com functions, including market analysis, marketing communications, demand generation, and customer • More than 15 years channel experience relationship management. He has more than 15 years of software, hardware, and services management • High-tech veteran of Tech Data, Skyway experience in various commercial markets, including Software and Redvector.com finance, healthcare, education, and government. He is a • Kaseya 3 years high-tech veteran of Tech Data, Skyway Software, and RedVector.com and a former management consultant at Arthur Andersen and Blasland, Bouck & Lee. Castro graduated from The Wharton School at the University of Pennsylvania with a M.B.A. in Finance and Information Management.
- 4. About Kaseya • Enterprise-class IT systems management for everybody • Founded 2000 & privately held, no debt, no external capital requirements – Consistent, profitable revenue growth • 33 offices worldwide in 23 countries with 450+ employees – 12,000+ customers – Millions of assets managed • 6 patents issued for IT service delivery processes & remote IT management processes – 37 patents pending • Common Criteria (EAL2+) certified and FIPS 140-2 security compliant • ITIL v2 and v3 compatible
- 5. Why MSPs Choose Kaseya • A single Kaseya user can proactively manage 1,000s of automated IT systems and network tasks in the same amount of time required by a team of technicians using other techniques • It’s the industry’s only patented single-server-single-agent architecture; MSPs get enterprise-class capability that is easy to use and easy to afford • With 60+% of top MSPs worldwide using Kaseya, they get access to the most robust community available • And with so many ISVs plugging in to Kaseya via a seamless integration process, they get an easy way to leverage their existing strategic technology partnerships
- 6. Our 10 Core Observations on MSP Pricing in 2012
- 7. The survey & methodology • Annual survey of worldwide user base (Q4 2012) • Sample size 3,500 • Maximum response rate 22% • Responses from 29 countries • Prices converted to $USD at FX rates as of 11/14/12 • MSP users with 10 to 30,000 devices under management • MSP users/demographics include – Break-fix, monitoring only, pure-play MSP, and power-user MSP – Owners, managers, administrators, technicians • Simple statistical analysis (median and 1s)
- 8. Observation 1: Most MSPs evolve beyond break-fix, yet still use suboptimal pricing strategy Service Offering Mix How Pricing Strategy (weighted by response) Determined Break Fix, Value 14% Based, 15% CEO, 33% Cost Based, 25% Managed Price Services, Match, 86% 27% Source: Survey of 758 Kaseya Customers
- 9. Observation 2: The predominant pricing model is – still – bundled services Other, 1% Value Based, 15% Per Device, 31% Tiered/Bundled, 53% Source: Survey of 611 Kaseya Customers
- 10. Observation 3: Geography still drives block hour prices and per-device prices Per Block Hour Per Desktop Per Server Per Mobile Low $24 $27 $103 $10 Median 89 52 167 16 High 121 86 255 25 Variance (1σ) 14 6 39 3 Source: Survey of 473 Kaseya Customers
- 11. Observation 4: The average monthly contract for 67% of global MSPs is $1,001 to $2,500 $2501 to $5000, 9% More than $5000, 12% Less than $1000, 12% $1001 to $2500, 67% Source: Survey of 401 Kaseya Customers
- 12. Observation 5: Two out of three MSPs derive more than 50% of sales via managed services Less than 25%, 11% More than 75%, 31% 25% to 50%, 22% 51% to 75%, 36% Source: Survey of 454 Kaseya Customers
- 13. Observation 6: Specialty services still are only offered – and delivered – by a few MSPs Responses Advanced monitoring / data availability services 11% Advanced security / threat protection services 19% Advanced backup / business continuity services 18% Advanced asset management / product lifecycle services 4% Advanced mobile management / worker mobility services 8% Vertical industry services or compliance services 10% Source: Survey of 302 Kaseya Customers
- 14. Observation 7: World class MSPs outperform their peers across most dimensions • Revenue growth rate is 1.5 to 2x higher • Service delivery quality score is 1 to 2 points better – Measured on simple satisfaction scale of 1 to 10 • Client retention rate is 10 to 25 points higher • And… Source: Survey of 311 Kaseya Customers
- 15. Observation 8: World class MSPs are significantly more valuable than their peers Gross Profit Peer World-Class 1st Quartile Managed Service Block Hour Source: Survey of 418 Kaseya Customers
- 16. Observation 9: Four out of 5 MSPs are holding firm on pricing – or increasing prices – in 2013 Price decrease, 20% Price increase, 25% No price change, 55% Source: Survey of 633 Kaseya Customers
- 17. Observation 10: In conclusion, there is PLENTY of global opportunity STILL out there • Value based pricing delivers higher gross profits for the firm • Specialized services provide new revenue for the firm • Client centric services – priced according to client value perceptions - ensure higher service delivery quality and higher client retention • Better client retention and higher firm profits increase employee morale and decrease technician turnover
- 18. Get Started With Kaseya! • For a free live product demo www.kaseya.com/mspdemo • For a free trial www.kaseya.com/trynow Get your “pre-release” 2012 • To speak with us report via email: www.kaseya.com/contactme david.castro@kaseya.com Respond within 24 hours Include “2012 MSP Survey” in the subject line /KaseyaFan /company/kaseya @kaseyacorp community.kaseya.com