Support is big business

ASP, the Association for Support Professionals, just published its annual survey of support revenue. ASP reviewed the financial reports of 100 public software companies in August and found that services as a whole (support, consulting, training) provided more than half (56.9%) of total company revenues, across the board. And this is good, profitable revenue since margins are close to 60% (56.8%), with both revenue and margin percentages up since last year.

If we just look at support the survey found that it constitutes a very respectable 38.9% of total revenue with a remarkable margin of over 83.2%, so much higher than for other services such as consulting and training.

If you find that your executive team still looks down on support as an afterthought or worse, perhaps sharing these numbers would help?

For more information about the survey go here.

Can support drive sales?

Let’s start with the obvious: satisfied customers tend to be repeat customers and also make referrals to others. Unhappy customers, on the other end, restrict their add-on purchases and try harder to extract discounts on mandatory purchases such as support renewals. They tell others of their woes and discourage them from buying. And it’s clear that support plays a big role in fostering customer satisfaction — so support drives sales, right? That may be well true, but the difficulty lies in proving it.

Here are some ideas to measure support’s influence on sales:

• contrast (very) satisfied support customers with (very) unsatisfied support customers when it comes to add-on purchases
• compare discount percentages between satisfied and unsatisfied customers (balance that with deal size)
• compare referrals by satisfied customers with referrals by unsatisfied customers (it’s tough to measure anti-referrals, unfortunately)

Other ideas? Please comment on this post.