When it comes to sales staff, the majority of MSPs have either 2-5 (37%) or 6-10 (36%) dedicated sales staff. About a fifth (19%) have a sales team of 10+ members.
Small MSPs are more likely to have 1-5 sales staff members. Medium are slightly more likely to have between 2-10 sales staff, while large are much more likely to have 10+ sales team members. MSPs with the highest revenue are more likely to have more sales team members overall than their lower-earning counterparts of the same size—which implies that more sales team members can bring in more business.
MSPs with the highest projected growth rates are much more likely to have a larger sales team of 10+ team members—suggesting that MSPs who invest in sales expect to bring in more clients (and, ultimately, revenue). Interestingly, those with the highest ARPU are more evenly split across sales team sizes, suggesting that MSPs don’t necessarily need a large sales function to charge top prices and be efficient.
Most MSPs dedicate anywhere from 10-35% of their total budget to their marketing efforts. Small MSPs are more likely to only allocate 1-10% of their budget toward marketing.
However, when looking at top revenue earners, we found that investing more in marketing is likely driving financial performance. Small, high-revenue MSPs are slightly more likely to use 35- 50% of their budget for marketing, while large high-earners are slightly more likely to set their marketing budget at 50%. Those with high projected growth rates are also much more likely to allocate 35-50%+ towards marketing.
Quality marketing may also have an impact on customer success and churn, since MSPs with the highest CSAT and client retention rates are much more likely to devote 50%+ of their budget to marketing.
Interestingly, those with high staff utilization rates are much more likely to have marketing budgets in the 50%+ range. While it’s difficult to see a clear connection between marketing spend and staff productivity, it may be that MSPs who prioritize investing in different areas of their business—from the sales experience to service delivery—are more efficient and performant overall.
“25-30% sounds high. I would say closer to the lower end of 10% up to 25% seems right. We have two people on the marketing team: one working on the digital side and the other doing follow-ups, calls, and invitations to webinars. We're trying to be disciplined and consistently have activities going on in sales and marketing.”
Ann Westerheim
Founder & President
Ekaru
A little over half of MSPs (53%) say that client referrals and word of mouth is their top growth channel. This was followed by social media and PR (at 46%) and paid advertising and sponsorships (at 39%). Only about a quarter (26%) of MSPs have mastered using SEO and content marketing (the least popular response) to acquire new customers.
Small MSPs are much more likely to rely on referrals and word of mouth, and they’re much less likely to be successfully using paid advertising to grow. Large MSPs are slightly more likely to say paid advertising is a top channel. Interestingly, when we look at high-earning MSPs by size, small MSPs are likely to say paid advertising is a top channel, while larger high-revenue earners are more likely to say SEO, content marketing, and partnerships are their top levers. This suggests that, regardless of the size of your organization, you can still effectively invest in any marketing channel to drive growth.
Those with the highest projected growth rates and staff utilization rates are more likely to say
MSPs with the highest customer retention rates are more likely to rely on client referrals and less likely to rely on paid advertising to grow—showcasing how increasing word of mouth can reduce spend on other areas of marketing.
53% of MSPs say client referrals are their top growth channel—but only 34% track Net Promoter Score (NPS), which is a measure of a client’s willingness to refer your business to peers. MSPs who rely on referrals for growth should send NPS surveys to customers and then proactively reach out to their high scorers (9s and 10s) to ask for a referral.
“Referral partners are a huge opportunity for MSPs, and I think that client referrals is our top growth channel. But we definitely get leads from marketing too. We’ve gotten leads from our logo being on the boards at Edmonton Oilers’ games.”
Kendra Schaber
Client Services Manager
Alt-Tech Inc.
“Referrals are always important, but to grow, you have to go beyond them. We’ve been doing content marketing. It drives traffic and folks often want to check us out online to see if we offer helpful information. It shows we know what we're talking about.”
Ann Westerheim
Founder & President
Ekaru
The biggest challenges MSPs say they face when it comes to acquiring new customers are too many competitors in the market (41%), shrinking client budgets (39%), and being underpriced by competing solutions or firms (38%).
Less than a quarter felt that a lack of upsell/cross-sell initiatives (17%) or lack of dedicated sales (12%) staff are impeding client growth. Since this report found that having formal client expansion tactics and more sales staff can drive revenue—on both the existing and new customer fronts, respectively—MSPs should explore whether these initiatives could help them overcome competitors or tight budgets.
Smaller MSPs are more likely to say not having sales staff is hindering growth. Since small MSPs with high annual revenue are more likely to invest in marketing, other small businesses may want to explore if certain marketing channels can drive growth better than outreach from additional sales staff. Large MSPs are slightly more likely to say being underpriced and too much competition are their top issues. This suggests that small firms could win accounts from bigger MSPs based on price—if their service offering is right. Since top-earning small MSPs are more likely to say they struggle to find specialized/skilled staff to offer new services, they may need to shore up their technical capabilities first.
“There are a million clients out there that wish they didn't have to spend money on IT—so that's a constant problem. And it probably won’t go away. They see it as a cost instead of an investment in their own growth—and the challenge is we need to make them see it otherwise.”
Darrin Leblanc
Vice President Biz Development & Operations
EPK Solutions
”I think one growth challenge is there's a lot of noise in the industry. Also, the complexity of keeping up with technology is tough because things are moving so fast. People are looking for us to be technology advisors who can give advice on a broad range of things. It’s hard to do well.”
Ann Westerheim
Founder & President
Ekaru
32% of MSPs feel they’ll gain the best advantage in the year ahead by focusing on both the client experience and their operational efficiency. The next two top advantages are controlling costs and expanding service offerings, at 27% each. Toward the bottom of the list are improving reporting (18%), updating the business model (17%), or acquiring other businesses (13%). Since MSPs who track more metrics tend to outperform their peers in a number of areas, developing better reports should be a higher priority for MSPs.
Small MSPs are slightly more likely to say expanding service offerings would let them pull ahead, but they are also less likely to say upskilling current employees would help them. Since training current employees would likely be required to offer new services effectively, small MSPs shouldn’t discount how employee growth and development can influence the client experience.
Executives are more likely to say expanding services will give them the best advantage in 2025 while technical and customer-facing roles are more likely to say upskilling employees would. Managers are more likely to feel that more strategic consulting services and better business planning should be priorities. Leaders should ensure they invest in team training and strategic frameworks before adding new services so their employees can effectively deliver them to clients.
“I think what's going to set us apart from other MSPs is our care for our clients’ businesses. We want to be involved and know if they're making big changes, we can bring valuable insights from our own experiences to our clients.”
Kendra Schaber
Client Services Manager
Alt-Tech Inc.
“One advantage we have is that we've planted a lot of seeds over the past year in terms of creating some long-form content. This has generated pretty good visibility for us on places like LinkedIn, and we’ve had quite a few people reach out to us at the beginning of this year.”
Ann Westerheim
Founder & President
Ekaru
When asked what their biggest challenges were for the year ahead, MSPs said increasing costs (55%), shrinking client budgets (39%), access to capital (30%), and compliance and regulatory demands (34%). Client engagement and employee retention are the least concerning areas. Since client satisfaction has been tied to staff utilization and training, MSPS shouldn’t overlook how retaining experienced staff contributes to client success and service delivery.
The top revenue-earning small MSPs are more likely to view a lack of reporting and inefficient tech stack management as their top challenges for the year ahead. Large high earners are more likely to see shrinking client budgets as their biggest obstacle. All MSPs should explore how they can improve technical efficiency to lower their costs and better serve their customers, especially during potentially lean times for client spending.
ScalePad creates software that helps IT managed service providers work more effectively, both internally and with their clients. From wrangling hardware and software assets to monitoring vital backups and compliance frameworks, our platforms give MSPs the tools they need to succeed.
