Expertise Marketplace - Professional Service Firm Marketing Blog

The Return of Market Intelligence

The topic of this 90-second video is “the return of market intelligence” in the professional services arena, from two perspectives.

 

First, market research is making a comeback from its previously low status in the marketing functional portfolio. Increasingly, senior marketing leaders are asking their mid-level marketing managers to do research as a springboard for marketing campaigns. Also, more professional service firms are undertaking strategic planning activities that include competitive intelligence, economic forecasting and trends analysis. Tomorrow's successful professional service firms will use market intelligence to compete effectively. Tomorrow's successful professional service marketers must possess market research skills!

The second perspective on “the return of market intelligence” is about its ROI (return on investment). In her book Marketplace Masters, Lowe summarized her findings that professional service firms which formally budgeted for market research reported two to five times greater effectiveness (than those that didn't formally budget for market research) in delivering client service, offering value-added services to clients, and other areas of competitive effectiveness.  

“Looking Out” means pursuing research on clients, competitors and markets that are outside of a professional company’s internal confines to detect market shifts and opportunities. It means taking a clear-eyed look at what is ahead, gaining new intelligence about the marketplace, and creating a reliable sounding board against which to evaluate new opportunities or threats.

Firms that employ market research will enjoy a loyal and growing client base.

Look out!

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Managing outsourced service provider relationships

In this video, I discuss the opportunities and challenges facing mid-level professional services marketers as they manage outsourced service providers for their enterprises. For many mid-level marketers, leading a project with an outside agency is their first chance to steer an initiative on their own. The stakes are high.  

  

Many mid-level professional services marketers find – sometimes the hard way, through mistakes and underperformance -- that these opportunities come with pitfalls. Senior executives have certain expectations. The outside agencies or outsourced service providers, with their own technical or creative capabilities, have their own expectations. Mid-level marketers are at the crux of this triangle, and must deftly pivot between both sides. They must help set – and re-set -- the scope of the project. They must communicate, communicate, and communicate again, as they drive the project to a positive outcome. Disappointments are not only possible, but all too common.

Instead of learning the hard way – on the job – about how best to manage these agency relationships, wouldn’t it be better if mid-level professional services marketers had a chance to learn about these and other issues BEFORE they begin managing a project for their company? That’s what the Professional Services Leadership Initiative (PSLI) is offering currently to 21 marketers from around the world.

What's next in marketing technology for professional services

In my newest video, I discuss digital marketing, which will be one of the modules at the 2014-15 Professional Services Leadership Initiative at the Robert H. Smith School of Business.  

 

Professional service marketers have made significant strides in four areas of marketing technology. First, they have embraced social media channels for thought leadership distribution and brand visibility. Second, they have incorporated marketing automation tools that improve connections between their firms and targeted prospects and clients. Third, they have led their enterprises to optimize internal and external data, and to make data-oriented marketing decisions toward a competitive advantage. Fourth, they have improved their prowess with analytics and ROI metrics.

What’s next on the professional services marketing technology horizon? First, Predictive segmentation, in which marketers will be able to connect the dots between messages, service offerings, and clients -- predicting those leads that will have the highest likelihood to buy. Second, technology-enabled crowdsourcing, which has the potential to profoundly affect service portfolio management and innovation. Third is artificial intelligence, which underpins predictive segmentation and crowdsourcing (and probably more!).  

The beneficiary of these marketing technology advances? The professional services client – and beyond that, society. 

Measuring professional and business service Word-of-Mouth marketing

I usually bluster that professional and business service firms (PSFs and B2Bs) get short shrift in research on marketing practices. And I am sometimes concerned when PSF and B2B marketers tell me they are challenged about undertaking even (arguably) traditional measurements like brand awareness.  

But when it comes to Word-of-Mouth marketing -- much less measuring it -- it's a new world for PSFs and B2Bs. And so, when I just stumbled across a thought piece on measuring word of mouth (WOM) marketing, I looked to see if it has some relevance for PSFs and B2Bs.

I think it just might.

Take a look at Exhibit 1 -- a chart showing three stages of buying consideration (Initial Consideration Set, Active Evaluation, and Moment of Purchase) when the article's authors suggest WOM can be best measured. These stages are further illuminated by looking at whether the decisions are being made in a mature or developing market. 

Even though this study is focused on consumer purchasers of expensive products, just the chart alone suggests that PSF and B2B marketers could break out the various points along a buyer's decision-making process for a complex professional or business service. And once those decision-points are defined, they could be measured.  Exhibit 2 is also thought-provoking.

WOM marketing is an intriguing possibility for marketing and selling intangible services. It may take a full recovery from a recession to see this take off, but I suspect it will.

Let me know If your firm is undertaking WOM marketing or measurement, and I'll write a post or online newsletter article about it!)

Want Marketing and BD effectiveness? Then talk to us!

In January, I posed a question to the attendees of a law firm marketing conference about the barriers they face in improving effectiveness. 

Those attendees responses are featured here.  I asked the same questions of my blog readers. Here's what you said:

What is the most difficult barrier your firm faces in improving marketing and business development effectiveness?

None/not enough measurement of programs or people: 28.6%
None/not enough incentives and rewards: 28.6%
Poor/less than optimal systems capabilities (i.e. contact databases, intranet): 0%
None/not enough communication, training and/or professional development: 42.9%

One respondent said: "We are working on this and it goes hand in hand with #3 [systems capabilities], but it's a long, slow road to Rome." Another said: "Leadership....our leaders are not in tune with M&BD activity, needs, etc, they are focused laser like on short term financial numbers. Wrong! Wrong! Wrong!"

From these and the law firm conference respondents, it's clear there's not enough talking and learning underway between revenue-generating practitioners and marketing/business development professionals.  These findings echo two articles that appeared in the Wall Street Journal yesterday, "Law Firms Embrace Business School 101," and "Lawyers Often Lack the Skills to Draw, Keep Clients," (Subscription required on both).

I'll have a lot to say about this topic in my upcoming book,The Integration Imperative: Erasing Marketing and Business Development Silos -- Once and For All -- in Professional Service Firms (Professional Services Books, 2009).

PSFs should fix technology barriers first!

In my “Big Question #1” post, I asked my blog readers to tell me which PSF marketing and business development effectiveness barrier(s) they’d address first if they were their firm’s executive managers. Here’s the conference's polling results, in case you missed it.

• None/Not enough measurement of programs or people = 25%
• None/Not enough incentives and rewards = 25%
• Poor/less than optimal systems capabilities (i.e., contacts database, intranet) = 21%
• None/Not enough communication,training and/or professional development = 29%

I offered this same poll to this blog's readers. Watch for my upcoming post on the answers. 

For blog readers who took this survey, your biggest barrier appears to be "None/Not enough communication, training and/or professional development." Here's an actual comment from a respondent:

"Leadership....our leaders are not in tune with M&BD activity, needs, etc, they are focused laser like on short term financial numbers. Wrong! Wrong! Wrong!"

Which PSF marketing and business development effectiveness barrier(s) would you fix first if you were your firm’s executive manager?  Take the survey and add your own voice to these findings.

I’d fix the technology barrier first. It’s the most obviously structural barrier, and its improvement could help shape new cultural norms. Its overhaul would be unambiguous -- quite non-ignorable (a good thing). Its improved capabilities could be incrementally rolled out. The improvements would be highly conducive for internal communication and training, and perfect for introducing new measurement processes and rewards programs.

I'll keep this survey open for another week or so, and then report again on the issue.

My Big Question #1

Recently I moderated a panel discussion of CMOs at an annual conference of law firm senior marketers and marketing partners. We surveyed the 150+ attendees on the following question:

What is the most difficult barrier your firm faces in improving Marketing and Business Development effectiveness? Their answers spoke volumes!

• None/Not enough measurement of programs or people = 25%
• None/Not enough incentives and rewards = 25%
• Poor/less than optimal systems capabilities (i.e., contacts database, intranet) = 21%
• None/Not enough communication,training and/or professional development = 29%

Are you surprised at how evenly these “Barriers to Effectiveness” answers stacked up? What does it mean, that no one answer was foremost among these four?  

What are your own opinions about the most difficult barrier your firm faces in improving Marketing and Business Development effectiveness? Add your votes to our poll here. I'll report back as soon as we get enough responses.

My big question to you is this: If you were the executive manager of your firm, would you fix all these barriers at once? Or would you pick one to start with first? Which one?

I’ll share my own opinion on Monday.

Are you "cup half-empty" on Marketing ROI?

Paul Dunay is.  I just received his latest Buzz Marketing for Technology newsletter, which featured a link to an intriguing post entitled "Is ROI Killing Marketing?"

Dunay's got a special facility for exaggerating to make a point  (he even says he does this on purpose!).  This is a technique that actually DOES make people stop and think. But when he cited his very first example of how ROI may be killing marketing, I found myself in disagreement.  He wrote:

"... consider internal branding campaigns. With little to show other than happy employees, this initiative would fall to a second tier initiative since lead generation activities would normally be needed to calculate your ROI. As a second tier initiative it is fine. But who can afford to have that as a first tier initiative anymore if you are only judged on ROI?"

This is a simplistic portrayal of both ROI initiatives and internal branding campaigns, and, although Dunay's readership is broadly targeted, it's especially simplistic for professional service firms (PSFs).  For the PSF sector, employees ARE critical embodiments of the brand promise, so internal campaigns are crucial, and happy employees are not the sought-after result (although of course happy employees are also critical, but it's likely not because of an internal branding campaign). 

And it's simplistic related to ROI initiatives in the PSF arena too, since the connection to the marketplace is highly nuanced and complex.  I don't know ANY PSFs that only judge people on ROI.  The truth is, they don't measure ENOUGH on ROI, even as part of other performance standards.

Despite my critique, I think Paul Dunay does a great job of reminding us to look at where we should put our emphasis -- and make deliberate choices to make our efforts count!   

Pay attention to anomalies and other nuggets from a conference

I went to a conference on Measuring Innovation Performance yesterday.  It was the first time in too long that I was an attendee, not a speaker, and so I enjoyed myself immensely. 

Some of the content related to classic business strategy, some to differentiation.  Some of the best nuggets related to professional service firms (PSF) included:

• When assessing the viability of any particular business strategy, make sure you understand the risks involved. There are three types of risk:  1) technical, 2) executional (can I do it?), and 3) market/competitive risk. Ask yourself the risk of pursuing the strategy and the risks of NOT pursuing the strategy.
• Quality is directly linked to innovation.
• Assess opportunities as well as risks. Most companies forget to do this. But when thinking about opportunities, remember there are COSTS to pursuing opportunities. (“This opportunity will cost us $x.  What other things could we be doing with this money that might be more important to us?”)
• Industry knowledge is a key differentiator.
• When thinking about differentiating with your people, hire TALENT over experience.
• Innovation ROI should be thought of more broadly than many firms do:  it’s more than CASH, but also indirect benefits.
• Pay attention to anomalies. (My favorite!)
• Most firms operate from a budget mentality. Too few operate from an investment mentality.

I found, once again, that most of the presenters and examples were product- and manufacturing-focused.  The professional service firms in attendance were left to extrapolate the models, concepts and frameworks.

 

Wouldn't it be great if content could be pertinent and readily available to the global, $3+ trillion professional services sector?  Or that thought leaders would GET it that we are unquestionably in a SERVICES economy?  Maybe I'll have to write another book, or develop an institute targeted especially to PSFs.

Could be fun.   

Money's pouring in; why are these people crying?

Just today, I had conversations with two people in different levels of seniority and in different professional sectors about a scenario I had hoped would never occur again: as a firm rakes in the revenues and profits, resistance builds to investing in tomorrow's marketplace advantage. 

Conversation #1

A marketing manager in a very prominent professional service company called me today to ask for advice about how to defend her firm's investment in relationship management technology.  Some of her colleagues, she reported, are questioning the large level of effort being made to hone the firm's contacts management and relationship intelligence applications.  At what point, they ask, does the return on investment start to diminish on developing marketing technologies for all this future business development?   "Money is flowing in, aren't we being just a little too focused on all this targeting and segmenting stuff?"   

Here's what I told her:  Yes, it's tempting to reduce spending time and money to refine your marketing technology infrastructure. Sure, someone should keep an eye on the internal marketing "spend," and it's inevitable that questions arise when a significant effort is made.  But your investments today will make it more possible to proactively manage when the next marketplace downturn occurs.  Respondents to the "Increasing Marketing Effectiveness" study soundly endorsed targeting, segmentation and relationship management programs as "best results" marketing initiatives (even the technological aspects of it!).  Don't overengineer your marketing and business development technology, but don't forget why you decided to invest in this arena to begin with.      

Conversation #2

The president of a small but well respected professional service firm called to ask for help on defending some branding strategies that he believes will help the firm attain market leadership in the future.  Unfortunately, his early trial balloons on his branding idea have met with significant resistance.  The firm is in the midst of a blockbuster year, making more revenues than ever before.  With all this money, his colleagues see no reason to make a change in the brand strategy at all. 

Here's what I told him:  You should be glad that your brand strategy decisions from several years ago have led your firm to the point that it's able to capture the marketplace gains it enjoys today.  Nevertheless, any professional service firm must be prepared to evolve its brand strategy in order to grow in the future.  (Isn't that the very point of developing a strategy in the first place?)  Equity owners owe it to their shareholders and partners to anticipate growth, and to develop a brand architecture that fosters that growth.  If the current brand strategy shows signs of limiting that growth, it's time to re-think it!  In my book Marketplace Masters, there are numerous examples of professional firms that forgot to pay attention to their journey in the marketplace.  Don't be one of them.

The bottom line: Don't let the waterfall of today's money wash away your critical thinking about tomorrow's competitive advantage.