How MSPs Can Overcome Customer Cost Objections for Security Services

For many Managed Service Providers (MSPs), cybersecurity services represent a double-edged sword. On one hand, they are an essential, high-value offering that can differentiate an MSP in a crowded market. On the other, many Small and Medium-Sized Businesses (SMBs) hesitate when it comes to pricing, often underestimating the real costs of robust security.

The challenge isn’t just about setting the right price – it’s about effectively communicating the value of cybersecurity and justifying the cost to customers who may not fully understand the risks they face. This blog will explore why SMBs often push back on security costs, how MSPs can use cyber risk assessments to demonstrate value, and strategies to reposition security as an investment rather than an expense.

These insights are drawn from a recent podcast, Selling Security: How MSPs Can Drive Cybersecurity Revenue and Protect Their Customers.

Why Small Businesses Underestimate the Cost of Cybersecurity

The reluctance to invest in cybersecurity is often rooted in a lack of understanding rather than a refusal to pay. SMBs frequently hold misconceptions about cybersecurity, including:

1. “It Won’t Happen to Us”

Many business owners still believe cyberattacks primarily target large enterprises, despite evidence showing that SMBs are actually more vulnerable. According to a 2023 Verizon Data Breach Investigations Report, 43% of cyberattacks target SMBs because they are perceived as easy prey due to weaker defenses.

2. “We Already Have Antivirus and a Firewall”

Many SMBs equate cybersecurity with traditional antivirus software and basic firewall protection, unaware that modern threats like ransomware, phishing, and insider threats require layered security approaches.

3. “Cybersecurity is Too Expensive”

Business leaders often compare cybersecurity costs against IT maintenance or hardware upgrades, failing to grasp that cybersecurity is an ongoing necessity, not a one-time investment.

4. “We Can Handle It Ourselves”

Some SMBs rely on internal IT staff, believing they can manage security in-house. However, even large corporations with dedicated security teams often struggle against sophisticated cyber threats.

The common thread in all these objections is an education gap. MSPs must bridge this gap by translating cybersecurity risks into business language that resonates with SMB leaders.

How to Overcome Cost Objections: Risk Assessments and Business Impact Analysis

1. Conduct Cyber Risk Assessments

A cybersecurity risk assessment is one of the most powerful tools an MSP can use to justify pricing. These assessments provide hard data and evidence to show customers what’s at stake.

Key risk assessment strategies include:

• Dark Web Scanning: Show customers if their credentials have already been leaked.
• Phishing Simulations: Demonstrate how susceptible their employees are to social engineering.
• Endpoint Vulnerability Audits: Identify outdated software and unpatched security gaps.
• Backup & Recovery Testing: Show how quickly (or slowly) their business can recover from an attack.

By making the risks tangible, SMBs are more likely to accept the need for advanced cybersecurity services.

2. Use Business Impact Analysis (BIA) to Demonstrate Financial Risk

A Business Impact Analysis (BIA) helps MSPs quantify the potential financial damage of a cyberattack. Instead of focusing on technical threats, focus on business consequences:

• Downtime Costs: How much revenue would they lose if their operations were down for 24 hours?
• Compliance Penalties: What fines could they face for failing to protect customer data?
• Brand Reputation: How would a data breach impact customer trust and future business?

By framing cybersecurity as a financial safeguard, SMBs are more likely to view it as an essential investment rather than an optional cost.

Pricing Strategies: How to Position Cybersecurity as an Investment, Not an Expense

1. Bundle Security into Tiered Packages

One of the most effective ways to structure cybersecurity pricing is through standardized security bundles rather than à la carte pricing. This aligns with the “Defend & Prosper: Maximizing the Cybersecurity Opportunity” playbook, which emphasizes the importance of bundling to drive value and simplify customer decisions.

• Essentials Security Package: Covers basic protections like endpoint security, MFA, and DNS filtering.
• Advanced Security Package: Adds Managed Detection & Response (MDR), dark web monitoring, and compliance tools.
• Premium Security Package: Includes full security orchestration, 24/7 SOC monitoring, and SIEM integration.

Why bundling works:

• Reduces Decision Fatigue: Customers don’t have to choose individual services; they select a level of protection.
• Encourages Higher Spend: Tiered pricing psychologically encourages customers to choose mid-tier or top-tier packages.
• Provides Consistency: Standardized security stacks streamline service delivery and reduce support complexity.

2. Price Per User, Not Per Device

Many MSPs make the mistake of pricing security per device, but this dilutes the value proposition. Instead, price security per user, emphasizing that employees—not just devices—are the primary attack vector.

3. Offer a Cybersecurity SLA to Reinforce Value

A well-defined Cybersecurity Service Level Agreement (SLA) clarifies what’s included and establishes clear expectations for response times and remediation. This helps shift the conversation away from pricing and toward business resilience.

4. Educate Customers Through Regular Security Reviews

Regular Quarterly Business Reviews (QBRs) or Monthly Security Reports keep cybersecurity top-of-mind. These touchpoints reinforce the value of an MSP’s security services by showcasing real-world threats prevented, updates to compliance requirements, and new security enhancements.

Positioning MSPs as Cybersecurity Authorities

For MSPs, overcoming pricing objections isn’t just about selling security—it’s about changing the conversation. Customers must see cybersecurity as a business continuity strategy, not just an IT expense.

Key Takeaways for MSPs:

• Educate SMBs on Real Cyber Risks – Use tangible evidence like risk assessments, phishing tests, and financial impact projections.
• Bundle Security Services – Present security as a comprehensive package, not a piecemeal add-on.
• Shift to Per-User Pricing – Focus on protecting employees, not just devices.
• Use Business Impact Analysis – Quantify downtime costs, reputational damage, and compliance risks.
• Demonstrate Continuous Value – Conduct regular security reviews to reinforce ROI.

By implementing these strategies, MSPs can move beyond cost objections and position cybersecurity services as an indispensable investment in business resilience.

Final Thoughts

The cybersecurity pricing dilemma is a challenge all MSPs face, but it’s also an opportunity. By educating customers, structuring pricing strategically, and demonstrating real business impact, MSPs can increase adoption, boost recurring revenue, and strengthen customer trust.

For a deeper dive into cybersecurity sales strategies, check out the Podcast Selling Security: How MSPs Can Drive Cybersecurity Revenue and Protect Their Customers on YouTube. This podcast episode provides real-world insights from industry experts on how to structure and sell cybersecurity effectively. You can also download my Selling Security Digital Playbook, Defend & Prosper: Maximizing the Cybersecurity Opportunity Security Sales, designed to help MSPs build successful security programs. 

You can also listen to the podcast on the following streaming platforms: Apple | Spotify | Buzzsprout

Stefanie Hammond is Head Sales and Marketing Nerd at N‑able. You can follow her on LinkedIn