Boost Your Revenue with Cloud Storage & Backup

Cloud Backup

Guest Post by William Conner
I started selling cloud services 7 years ago; I was a reseller of Carbonite a few months after they opened their doors and haven’t looked back. It’s easy to be afraid of cloud services, watching how they encroach on what used to be our exclusive domain, but really it’s the natural evolution of technology and we need to figure out how to leverage it to our advantage. The great thing about cloud services is they’re like any other IT product, diverse and ever changing. That still leave the IT Pro in the position of trusted expert to recommend products based on client needs.

When talking about backup, let’s keep in mind the 3-2-1 Rule of Backups. Keep three copies, the primary data and two backups, store the backups on two different media, cloud, magnetic, optical, etc., and keep one copy offsite. Cloud services allow for offsite backup beautifully. The 321 strategy gives us many options for disaster recovery in the event of fire, theft or seizure. A typical deployment for us is to back up to a low cost NAS like the D-Link DNS-320 and have a mirror of that backup in the cloud via BackBlaze or SymForm which works quite well.

I’m not going to shill for a bunch of different products, I still recommend Carbonite, and get my cut when I do, but I also use SymForm, Backblaze, Keepvault, Vembu, Acronis and others. Each caters to specific needs, so all we need to do is identify their strengths, figure out what the customer needs, and make the sale.

Let’s look at what might be important to a given user based on their usage profile:

Typical Demands Home – Light Data SOHO – Medium Data Small Business – Larger Data
Configuration Zero Configuration Little configuration needed Handled by IT contractor
Storage Space 100 GB or less 100-1000GB 500GB+
Backup Speed Quick, but not a huge concern Within a few hours As quickly as possible
Recovery Speed Can tolerate a multi-day redownload Needs unthrottled ASAP recovery options Unthrottled recovery and overnight delivery of storage media.
Remote access Handy access via smartphone or tablet Smartphone/Tablet or Web interface access to data. Generally only needs web access to datasets.
Encryption Strong Encryption – Provider managed keyset Strong encryption, controllable keyset Strong encryption, controllable keyset
Partner Support Can rely on vendor techsupport Expects VAR/IT Pro to provide support. Expects VAR/IT Pro to provide support.
Vendor data centre location Generally not an issue. May have concerns or regulatory compliance issues regarding foreign storage. May have concerns or regulatory compliance issues regarding foreign storage. May see foreign storage as an advantage.

 

When evaluating services, it’s important to pay attention to what they offer based on the chart above. Offerings are always changing, and much like anti-virus vendors, what may be great this year may be really bad the next. Carbonite was a really great provider, but they throttle daily backup amounts, Backblaze doesn’t. Symform recently started selling direct to consumer and included 200gb of free backup, changing their initial partner strategy and KeepVault has lagged in its pricing, moving from very competitive to very expensive.

Ok, so now you’ve determined your clients need, your vendor’s strengths and you need to figure out how to make some money with this information. Most providers offer partner programs that allow you to either take a cut of the sale through referral commission, or offer wholesale prices if you’ll handle billing and support. I like to do the latter, as my clients generally don’t care who the vendor is, just that product works and that they don’t have to deal with many invoices or helpdesks for their technology products.

I typically bill above retail, because of this added support, thereby extending my profit margins and taking responsibility for the product myself. With cloud backup, this is pretty easy to do because the servers are very much set-it-and-forget-it products that require little effort to maintain.

There are really only three ways to sell cloud backup; by using passive links on your websites and promotional products, as direct recommendations to clients on-site, and as part of your MSP (Managed Service Provider) packages. For the most part, the revenue from the first two is minor, maybe $10-15 a year per seat depending on the client and package, but as part of a MSP package, they’ve been invaluable to me in two ways.

The first is by including off-site backup in my packages by default I’ve created have a competitive advantage as I’m not aware of any local competitors who do this. The costs of the service are built into the package, but to the client it looks like a freebie, one that they may never thought of or heard about before. Some might be have been confused by the amount of vendors in the field, or by pricing schemes and previously been scared off, but when I bring it up they greatly appreciate it.

They’re hearing about the cloud in the media but they don’t understand it. This gives us credibility in the sales process thanks to Microsoft’s advertising, and we get to direct the content of the conversation. Cloud backup has allowed me to close more MSP contracts since I started bundling them by default because my clients see that I’m looking out for their interests and starting disaster planning from the get go.

Second, because of the success in boosting MSP contract sales, I’ve created residential MSP contracts for pre-qualified clients. These residential contracts sell easily with cloud backup as I’m able to talk to the prospect about total security and protection. I’ve cemented myself as their only vendor because their AV, cloud backup, remote access and support services are now channelled through my one single invoice. Not only does this allow me to completely own the client, but I can take that client portfolio with me to a vendor and negotiate better pricing.

No matter how you decide to integrate cloud backup into your offerings, whereby as a single sale add-on or as an integral part of your service packages, I highly recommend you do. You’d be putting yourself and your clients at a severe disadvantage if you don’t. I’ve seen a 15% boost in sales, greater stickiness and stronger relationships. I’m offering more comprehensive services and eliminating the feeling of being nickel in dimed clients often resent when dealing with multiple vendors in regards to their IT infrastructure.

And a final thought, the pitch for cloud backup is simple: “With cloud backup your data is encrypted and stored offsite within minutes, protecting you from accidental deletion, theft, seizure or god forbid a fire, local backup isn’t enough. You can always buy a new computer, but you can’t buy back your data, ready to sign?”

Note: substitute data with pictures if it’s a residential client.

Guest Post By William Conner: William Conner is the owner of MyComputerHero, an IT consultancy in Calgary, Alberta since 2005. He has been in the SMB IT industry for 15 years, holds various vendor and industry certifications and is finishing a BSc. in Computer Information Systems at Mount Royal University.



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Comments (18)

  • Jeremy says:

    Thanks for the article on cloud storage. I like how you even put in the selling point at the end. This article was worded well and has given me some better insight on cloud back up solutions.

    Thanks William

  • Troy Mackaway says:

    I have to argee it’s a great article and honestly not something I had considered. But I am looking into it right now. Thank you so much!

  • G says:

    I’v been personally using idrive

    what is your experience with idrive?

    http://www.idrive.com/

    • William Conner says:

      Hi G,
      I’ve never used iDrive. Thanks for turning me on to them. The real answer is where do they fit in the need/feature matrix in the article. They look like a comprehensive provider, however they may not be suited for those with large data sets and might price themselves out of the market. Use what you’re comfortable with and what you understand. The point wasn’t to advocate for one service over another, but to get you thinking about how you can sell cloud backup and make some extra money.

  • Todd Hickerson says:

    The best guest post I’ve read to date on Technibble. Excellent work, William!

  • Cambridge PC Support says:

    Nice article, something I need to consider really.

    Coupla typos:
    whereby ===> whether
    nickel in dimed ===> nickel & dimed

    • William Conner says:

      You got me! I’m embarrassed to admit there are lots of errors in the document. I was so excited to submit it I didn’t proof it as thoroughly as I should have. I have egg on my face I suppose, and I commit to provide a better product next time.

  • papuchazo says:

    I think I’m going to have to move to a more affluent area. I’m starting to see how much living here is slowing down my growth. No one around here would ever buy into cloud storage no matter how good I pitch it to them.

    Hopefully the growth I’m having, although slow, will soon give me the opportunity to accomplish this. Thanks for the great article.

    • William Conner says:

      It may not be just about affluence, but how you structure your offerings. A good cloud solution may cost $5-10 a month. For most people who are hiring you that’s affordable, it’s just a matter of how you sell it. This is why I advocated bundling it. I’ll get into MSP plans in my next few articles and hopefully give you some ideas.

  • arringtondla says:

    What do you mean exactly when you say, “but I can take that client portfolio with me to a vendor and negotiate better pricing.” I understand why you would negotiate but I don’t understand what you have to make them lower pricing; is this because you’re bringing them a new customer, and this leaves room for you to dictate a price? Also this is a very good and informative article!

    Thanks!

    • William Conner says:

      First, thank you for the kudos, I appreciate it. :)

      Second, to your first point, If I control a portfolio of 100 or 200 seats I can call up a vendor and say “I have 200 seats I want to bring to you from x competitor. I like your product and rather work with you. I see you offer volume discounts on your site, but can you do better given my numbers? I handle all the billing and most of the support so it shouldn’t be much of an issue.” Vendors want to work with you, and they’ll give you more attention if you control seat vs just refer it.

  • Walter Carter Jr. says:

    Mr. Conner; I must say not only did you impress me with content of your message you gave me one of those rare nuggets that translates into more profit for my business and possibly reaching clients that I may not have gotten otherwise. Thank you for your insight. My business CCCITS adopted a MSP business model just last year after 6 years in business. I find myself constantly vigilant to find new ways to better serve my existing clients and attract new ones. Because of your article among many that I find here at Technibble, I now have a new way to make my business more efficient. Please Keep Up the Good Work. It is greatly appreciated.

    Walter Carter Jr
    CCCITS
    http://www.cccitsolutions.com/

  • Jesse Pereboom says:

    I am contemplating signing up with Livedrive, but it almost seems to good to be true. Any thoughts on this?

    http://www.livedrive.com/ForResellers

    • William Conner says:

      Your suspicion probably comes from the cost, but it’s consistent with Chris Andersen’s (Publisher of Wired Magazine) idea of low cost infrastructure making services free. http://www.wired.com/techbiz/it/magazine/16-03/ff_free?currentPage=all

      Keep in mind it’s located in the UK, so the data falls under UK search and seizure legislation, that may be an advantage or disadvantage to your clients.

      I can’t say whether it’s reliable or not, I haven’t used it. Pricing seems good though if you have the volume. Go through the chart, see if it meets the needs of your target groups. How do you want to break it up and pitch it to your clients, what’s important to you, what’s important to them.

      At the very least don’t sell it unless you’ve used if for a few months and know it inside and out. It’s been around since 2008, so that seems okay, but do some digging and experimenting. I tend to stick to North American companies just because it’s easier to force customer service to react to issues here because I know the legal resources better. Your comfort level may be different.