In a recent article called Competitive Analysis – Know More, Win More!, I stressed the importance of getting to know your competitors.
It struck me afterward that for those selling services, particularly in the B2B space, the toughest battle is usually fought against in-house resources. It’s often easy for us to lose sight of this vital fact, and I think there is a missed opportunity when we don’t pay it the attention it deserves.
In-House or Outsource?
There are plenty of arguments for and against outsourcing. Should manufacturing companies run their own cafeteria? Should legal firms run printing departments? If those activities are not core to their respective missions and strengths, then the reasonable answer is “no.”
There are certainly situations when running non-core functions in-house can make sense, but hidden costs and lost opportunity should always be major considerations. So why do companies hold onto activities that don’t serve a strategic purpose? Some common reasons are as follows:
- They believe doing as much as possible in-house gives them more control
- They think they are saving money (in some cases this may be true)
- They have some capacity available and they want to keep people busy
- Challenges in finding, trusting and then managing outsourcing partners
- A previous bad experience with outsourcing – regrettably this can happen
- For some business leaders, it’s a mix of ego and human nature – “why pay someone else to do it when we have people here?”
Selling Services More Effectively Against In-House
The intent of this article is not really to answer the outsource / in-house question. The goal is to get you thinking about the part of your market choosing to do what you provide, themselves.
You should view this group as a unique market segment and in a real sense, a formidable competitor. When selling services to these companies, you should be as strategic as you would when facing an external rival. Here are some ideas that may help:
- Know your industry well enough to get a sense of the size of the “Doing-it-Themselves” portion of it
- If a high ratio of companies in your addressable market are performing your services themselves, you need to know why and how
- The insights from the point above will help your positioning and messaging have greater impact
- If this is your situation, the messaging gets more heavily weighted on “why they should be outsourcing” first – followed by “why they should outsource with you”
- Focus on clearly articulating the value of outsourcing – help prospects understand how they win!
- Build a business case and use cost-analysis tools showing ROI and the advantages of leaving it to the experts. There is always interest in saving money and doing what makes sense for the company. It’s important to show the many hidden costs as well.
- Point out how your prospect can focus on other aspects of their business that are more strategic. For example, if you are an IT hosting company, your message may be something like “Ms. Prospect, you are accountants. Rather than investing time and money managing servers, networks and storage – let us do that! You can reduce headcount and get IT working on internal and client-facing applications that will improve your business and help you differentiate.”
- Show proven results and metrics from similar companies using your services. Leverage testimonials and case studies. – a sure way to gain the attention of your “in-house” prospects.
- Build the “value of outsourcing” story into your presentations, sales talk-tracks and other collateral, and lead with it
- Think about the migration path and be able to show them how they will transition. Again, use real-world scenarios and map out the processes you have in place to make it easy and smooth.
Some of this may seem obvious but make no mistake – selling services requires a different kind of positioning. And, if you have a large portion of potential prospects written off because they don’t outsource now, you are missing a significant opportunity! Change your approach by heavily educating these prospects on why outsourcing makes sense. If not, your pitch will almost certainly fall on deaf ears.
Please share any thoughts or experiences you may have with this topic. Contact us if we can help you with your marketing in any way, or point you in the right direction.