IT and Business Insights for SMB Solution Providers

Digital Marketing Agencies: The Latest Co-opetition?

MSPs face new competitors who have a ready-made entry point into IT spend via CRM customization. Should channel pros get on board? By Jessica Meek

DIGITAL MARKETING AGENCIES may seem worlds apart from IT service providers, but they are slowly encroaching on the managed IT arena. Should MSPs beat ’em or join ’em?

Yes!

Today digital marketing agencies provide a variety of cloud-related services. Typical offerings include custom application development, commerce development, portals (intranet and extranet), enterprise technology services focused on moving back-end systems to the cloud, and implementation of Salesforce and other CRM systems, according to Neal Sharma, CEO and co-founder of digital marketing agency DEG, which also offers managed services.

Neal Sharma

The bad news for MSPs? According to Jay McBain, principal analyst for channels, partnerships, and alliances at Forrester Research, CMOs now spend more on IT than CIOs. Translation: Digital marketing agencies have a ready-made entry point into customer IT spend. 

The good news for MSPs is that digital marketing agencies usually don’t provide more conventional IT support. Indeed, it’s typical to see agencies partnering with MSPs and “sending referrals back and forth,” says C.J. Ezell, CEO and founder at PointClear Networks, in Fairhope, Ala., a managed IT provider that also offers digital marketing solutions.

That’s because digital marketing agencies are much less likely to have the skill set required to offer managed IT support. “They don’t know how to run networks, they don’t know how to keep servers running or how to do the patches and break-fix work,” McBain says.

Still, digital marketing agencies have some advantages over MSPs that may give them the competitive edge when pitching prospects. Key among them is their relationship with customers.

“Agencies are in the business of understanding the customer first and building marketing solutions around that customer’s needs. IT providers are very much focused on what the technology can or can’t do,” Sharma notes.

This is particularly pertinent as digital transformation continues to be top of mind for SMBs. Agencies are “walking in lockstep” with their customers toward that transformation, according to McBain.

“They understand the marketing department, the speak, the mission, the language. So they can talk top of funnel, they can talk lead passing, they can talk all the different objectives the customer wants to talk,” he explains, adding that “it’s not a technical conversation. It’s a business conversation that happens to be solved via technology.”

Jay McBain

With the rapid pace of digital transformation, Sharma says, offering digital marketing services is a “tremendously lucrative” opportunity. To move on it, McBain says that MSPs must be able to brand themselves as someone who can add value to a project by choosing a specific industry to target and obtaining in-depth knowledge of it well before making the leap into digital marketing. Ramping up your sales and marketing skills is a must as well, he continues.

“Go to a road show or a meetup, subscribe to some marketing journals, get into the discussion,” McBain advises. “Know what’s going on with SEO, social media, ecommerce, and marketplaces. You’ve got to get a layer deeper in terms of being able to talk the talk in front of the customer.”

Image: iStock

About the Author

Jessica Meek's picture

JESSICA MEEK is a freelance technology and financial writer based in New York.

ChannelPro SMB Magazine
SUBSCRIBE FREE!

Get an edge on the competition

With each issue packed full of powerful news, reviews, analysis, and advice targeting IT channel professionals, ChannelPro-SMB will help you cultivate your SMB customers and run your business more profitably.