Every MSP wants to grow, but how you go about attracting new business matters. Should you invest in direct marketing tactics like cold emails, digital ads, and SEO to generate demand? Or should you double down on referral-based growth, letting happy clients and strategic partners do the talking? This guide explores both approaches in depth. It offers practical guidance on what works, why it works, and how to decide which model best fits your MSP’s stage of growth and market position.
Approach 1: Direct Marketing Strategy
Direct marketing involves proactively reaching out to potential clients through structured campaigns. This includes cold calling, email sequences, Google Ads, SEO, LinkedIn outreach, and local advertising. This strategy focuses on outbound lead generation and is often systematized using CRMs, marketing automation, and KPIs to track conversion.
Advantages
- Scalable and Predictable Lead Generation: Direct marketing allows you to scale your outreach efforts. By adjusting your ad budget, email volume, or cold call cadence, you can generate a consistent stream of new leads. This predictability makes it easier to plan growth, hire sales staff, and project revenue targets.
- Faster Market Penetration: If you’re entering a new geographic region or targeting a new vertical, direct marketing quickly introduces your brand. You don’t have to wait for word-of-mouth to kick in. You can reach your ideal clients on Day 1. This is particularly useful for MSPs looking to expand aggressively.
- Complete Message Control: With direct campaigns, you control the messaging, timing, and positioning. You can tailor offers, highlight differentiators, and test variations to see what resonates. This level of control is ideal for refining your unique value proposition.
Challenges
- High Upfront Time and Financial Investment: Quality direct marketing takes time, tools, and expertise. Whether hiring a marketing agency, running PPC ads, or writing cold email campaigns, you’ll need to invest resources before you see a return. This can strain smaller MSPs or those without marketing support.
- Lower Initial Trust Levels: Cold prospects don’t know you yet, so the burden of proof is higher. You’ll need strong case studies, reviews, or webinars to earn credibility. Without trust-building assets in place, direct outreach can fall flat.
- Constant Optimization Required: Marketing channels like Google Ads and email are always shifting. Algorithms change, inboxes get smarter, and buyer fatigue sets in. MSPs must continuously analyze results, test messaging, and optimize campaigns to avoid diminishing returns.
Approach 2: Referral-based Growth Strategy
This strategy relies on building a network of advocates — clients, partners, peers, and vendors — who refer new business to you. It also includes customer-driven word of mouth, reviews, and online reputation building. Growth is driven by trust, relationships, and long-term brand equity.
Advantages
- High-trust Leads That Convert: Referrals come from people your prospects already trust. This means there is less skepticism and a shorter sales cycle. These leads are often pre-sold on your value and pricing, leading to higher conversion rates with less time spent overcoming objections.
- Lower Acquisition Cost: You’re not paying for clicks, ad impressions, or email platforms. The most successful referral programs are driven by happy clients, great service, and strong community presence. This makes referral-based growth cost-effective — especially in competitive markets.
- Creates a Strong Brand Reputation: Word of mouth is a powerful validator. When businesses hear your name repeatedly from trusted sources, it builds a perception of credibility and reliability. Over time, this creates a powerful brand that’s hard for competitors to replicate.
Challenges
- Slow and Unpredictable Growth: Referral-based pipelines take time to build and are inherently reactive. You can’t force a client to refer you this month. If you don’t have a large existing base or well-established partnerships, growth may stall.
- Harder to Scale on Demand: If you want to grow by 25% this year, referrals can’t be turned on like a faucet. You’re at the mercy of other people’s timelines. This model is more difficult to scale when launching new services or entering new markets.
- Less Message Control: Referrals are based on how others describe you — not always how you’d describe yourself. If you don’t communicate your differentiators well, you may get referrals for work you don’t want, or that doesn’t match your current focus.
Key Decision Factors
- Stage of Business Maturity: Newer MSPs may need direct marketing to create awareness and build a client base. More established MSPs with a loyal client roster can shift toward referrals and deepen existing relationships.
- Sales and Marketing Capacity: Do you have someone who can write emails, design landing pages, or manage ad spend? If not, direct marketing may become frustrating or ineffective without outsourcing. If you have limited internal resources, referrals may offer better ROI.
- Client Satisfaction Levels: Referral strategies only work if your clients are thrilled with your service. If you’re not consistently exceeding expectations, you won’t get organic referrals — no matter how many review sites you’re listed on.
- Local Market Dynamics: In tight-knit communities, referrals dominate. But in large metro areas or verticals like healthcare or legal, targeted outreach may be necessary to reach decision-makers. Evaluate how your prospects prefer to engage with vendors.
- Urgency of Growth Goals: If you need to grow fast — to meet acquisition goals or exit plans — direct marketing offers momentum. If you’re focused on long-term stability and profitability, referral-based growth may yield better clients and relationships.
Staffing and Operational Considerations
- Direct Marketing: This requires marketing know-how: landing pages, email campaigns, SEO optimization, social ads, and analytics. You may need to hire or outsource copywriters, designers, or agencies to execute effectively. Having a dedicated salesperson also helps convert leads into clients.
- Referral Strategy: This requires client success management, account managers, and relationship-building skills. Your team needs to focus on delivering a world-class experience and identifying satisfied clients to ask for referrals. You’ll also need systems to track and reward referrals consistently.
Blended Strategy Recommendation
Most high-growth MSPs ultimately blend both strategies:
- Use direct marketing to create awareness and drive steady leads.
- Leverage referrals to close high-quality, warm prospects with lower resistance.
- Build marketing around client success stories to support both pipelines.
- Develop formal referral programs while maintaining outbound campaigns.
Implementation Tips
- Start with a Strong CRM: Whether you’re managing inbound leads or tracking referrals, your CRM should be the hub. Tag your lead sources, automate follow-ups, and analyze close rates to refine your approach.
- Make Referrals Easy and Rewarding: Offer a simple referral form, incentives, or discounts for clients who refer new business. Make it easy for clients to know who you’re looking for and how to refer.
- Test and Learn in Direct Marketing: Start small. Test a few cold emails, try a $500 Google Ads campaign, or boost a Facebook post. Measure everything. You’ll quickly learn which channels and messaging resonate best with your audience.
- Highlight Social Proof in All Channels: Case studies, testimonials, and success stories support both strategies. Use them in email campaigns, LinkedIn posts, and sales decks to build credibility.
Conclusion
There’s no universal winner between direct marketing and referral-based growth. Each has strengths. Direct marketing brings speed and scale. Referrals bring trust and stickiness. The smartest MSPs design a growth engine that uses both in harmony, adjusting based on capacity, market trends, and business goals.
Next Steps
Standing out in the crowded MSP market requires a combination of a clear UVP, strong branding, targeted marketing, and exceptional service. By following this guide and using the companion checklist, you can differentiate your MSP and build a strong, recognizable presence in your target market.
- Want more helpful guidance on selling security services? Check out our Marketing and Sales Answer Center
- Have a question for our experts? Send it to editors@channelpronetwork.com
ChannelPro has created this resource to help busy MSPs streamline their decision-making process. This resource offers a starting point for evaluating key business choices, saving time and providing clarity. While this resource is designed to guide you through important considerations, we encourage you to seek more references and professional advice to ensure fully informed decisions.
Image: iStock
