As a VAR, you know it makes sense to offer cloud-based services to your small and mid-sized business (SMB) clients. The cloud allows you to provide SMBs with enterprise-like features that are easy to implement and use, without large upfront capital expenses or huge monthly fees, while simultaneously adding recurring revenue for your own business. Yet you’re likely coming across multiple obstacles, including SMBs’ lack of understanding about cloud services or general inertia toward change. Here are five steps to overcoming common SMB objections to the cloud.

They include:

1. Don’t Overhype the Cloud. Cloud may be the latest buzzword and technology trend, but some SMBs are wary or may not be ready for it. If you go in trying to sell the cloud, a client may be put off immediately. And it’s understandable, since the cloud itself is not really what people want – it’s the value that the cloud brings that will get their attention.

2. Choose Your Battles. Don’t try to move a client’s entire business to the cloud at once. When you’re trying to get someone to change behavior, you start with something small. If someone asks for advice on getting in shape, for instance, you might suggest beginning with three 30 minute workouts a week; if you tell them to train four hours a day, seven days a week, they’ll never start. It’s a general rule about life that if you want people to say yes, you make it simple for them to do so. Limit your initial recommendations to make it easy for a SMB to adopt the cloud, and build from there. If you come on too strong at first, a client might back off completely.

3. Address a Real Pain. There are many ways the cloud is beneficial for SMBs – efficiency, scalability, high elasticity, etc. But focus on benefits that resolve the strongest pain points for your client. For example, data backup, business continuity, and disaster recovery is an area where a cloud solution can really make a difference for SMBs, since it replaces multiple software solutions with one web-based service.

4. Establish a Clear ROI. A common mistake of vendors selling cloud computing is to focus on getting clients to implement the latest technology without clear examples of what it can really do for the business. Focus on selling value first, putting the methodology second. Show the real dollars they can save each month and provide compelling use cases.

5. Offer More than Cost Savings. Remember that value encompasses much more than cost savings. To convince someone to make a change based on cost savings alone, the solution has to be massively less expensive, or many SMBs won’t want to bother. But if there’s additional value like greater peace of mind, employee happiness, or customer satisfaction, that intrinsic value plus cost savings combines to make a compelling argument.

There’s no doubt that SMBs are moving to the cloud, especially for applications in finance, data storage, CRM, and HR, as well as collaboration tools. While only 3% of businesses in 2011 had more than 50% of their infrastructure and applications in the cloud, by 2015 an estimated 46% will have at least half cloud infrastructure and applications, according to Gartner.

By focusing on your customers’ real needs and pain points – as well as the real value of the cloud solutions you’re offering – you can cement your relationships now and be the one your customers turn to as their demand for cloud solutions inevitably grows.

Justin Moore is CEO of Axcient, which works closely with VARs and MSPs. Monthly guest blogs such as this one are part of The VAR Guy’s annual platinum sponsorship.

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3 Comments on “Five Steps to Overcoming SMB Objections in the Cloud”

  1. Ted Hulsy Says:
    January 9th, 2012 at 5:10 pm

    Justin, great post.

    There is one more important point: bundle, bundle, and bundle. In most cases, backup and disaster recovery should be bundled in with other managed service offerings as mandatory or highly recommended components of the solution. For instance, if a partner is guaranteeing uptime and availability for MS Exchange and email services, the client must buy the bundle that includes the BDR service to protect these applications. As noted, clients care about the VALUE they get from their IT, and uptime and resiliency should bundled in wherever possible.

    The power of bundles makes the solution easy to sell and easy for the client to buy at the same time.

    Ted Hulsy
    VP of Marketing, eFolder
    @TedseFolder

  2. Ian Moyse Says:
    January 11th, 2012 at 1:15 pm

    There’s been a thunderstorm of growing noise surrounding cloud computing in the past 24 months. Vendors, analysts, journalists and membership groups have all rushed to cover the cloud medium, although everyone seems to have their own opinion and differing definition of cloud computing. Similar to many new sectors of technology, the key is to separate the truth from the hype before making educated decisions on the right time to participate.
    While still evolving and changing, cloud computing is here to stay. It promises a transformation – a move from capital intensive, high-cost, complex IT delivery methods to a simplified, resilient, predictable and a cost-efficient form factor. As an end user organisation of different sizes, you need to consider where and when cloud may offer benefit and a positive edge to your business.

    Cloud computing is a new concept of delivering computing resources, not a new technology. Services ranging from full business applications, security, data storage and processing through to Platforms as a Service (PaaS) are now available instantly in an on-demand commercial model. In this time of belt-tightening, this new economic model for computing is achieving rapid interest and adoption.

    Cloud represents an IT service utility that enables organisations to deliver agile services at the right cost and the right service level; cloud computing offers the potential for efficiency, cost savings and innovation gains to governments, businesses and individual users alike. Wide-scale adoption and the full potential of cloud will come by giving users the confidence and by demonstrating the solid information security that it promises to deliver.

    Computing is experiencing a powerful transformation across the world. Driven by innovations in software, hardware and network capacity, the traditional model of computing, where users operate software and hardware locally under their ownership, is being replaced by zero local infrastructure. You can leverage a simple browser access point through to powerful applications and large amounts of data and information from anywhere at any time, and in a cost effective manner.
    Cloud computing offers substantial benefits including efficiencies, innovation acceleration, cost savings and greater computing power. No more 12-18 month upgrade cycles; as huge IT burden like system or software updates are now delivered automatically with cloud computing and both small and large organisations can now afford to get access to cutting-edge innovative solutions. Cloud computing also brings green benefits such as reducing carbon footprint and promoting sustainability by utilising computing power more efficiently.

    Cloud computing can refer to several different service types, including Software as a Service (SaaS), Platform as a Service (PaaS) and Infrastructure as a Service (IaaS). SaaS is generally regarded as well suited to the delivery of standardised software applications and platforms, like email, CRM, accounting and payroll. The development of the SaaS business model has been rapid and it is now being used to provide high performance, resilient and secure applications across a range of company sizes and industries. So when should you consider a cloud service and what should you look for in choosing a vendor partner?
    Cloud or SaaS does not provide one-size-fits-all solutions, and not every application in the cloud will be right for your business. You should consider in what areas it makes sense to utilise the cloud. Where can your organisation gain improvement in areas of business efficiency, resilience and cost reduction? Look to others in your sector and what they have done, and look for simplicity and obvious choices in your first cloud solution adoptions. Review your shortlisted vendors carefully and compare them across multiple areas but not just price. With cloud computing you need to ensure that you validate who you are dealing with, what their reputation is and the quality of service you will receive.

    Things to consider when looking for a cloud service vendor:
    • Review your vendor and its financial viability – its profitability is an indication of its strength and stamina and reflects the strength of its business model and ability to execute as a long term supplier to your business.
    • Look at its technology (function/protection) and match it with your business requirements – look at the fundamentals such as safety and reliability first, as you would when buying a car, then consider the extras.
    • Study the roadmap and service enhancements your business will benefit from – what reputation does the vendor have for consistent delivery and innovation in the past few years?
    • Research the vendor’s reputation for support and service provision – how good are the SLAs (Service Level Agreements) and what is its capability to deliver results? How big is the support team? Are they located in your region, and are they employed directly by the vendor?

    Ignoring the cloud or moving everything to it in a race are both perilous positions. Taking educated steps to the cloud will ensure you gain the benefits that it can bring and that you don’t end up in a technological storm.

  3. Create Your Cloud Strategy In a Day : Rutweb Technology Says:
    February 21st, 2012 at 2:04 am

    [...] businesses while bringing about the greatest amount of revenue for you. As Justin Moore says in “Overcoming SMB Objections to the Cloud,” sell the value of a cloud solution, not the cloud itself. Look for your clients’ greatest [...]

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