What Every Managing Partner Needs to Know About Marketing Professional Services
Every day, managing partners are required to make decisions about topics we are not fully informed about. One day it may be about investing in a new piece of software, the next it may be about structuring a new compensation system.
Perhaps the area where these decisions are most common and most fraught with peril is marketing.
In most firms, the managing partner does not have an extensive background in marketing. Yet we are called upon to make decisions that will directly impact the growth and profitability of our firms.
A Little Perspective Please
In this post, I’d like to take a step toward helping you understand the realities of modern professional services marketing. My goal is to help you be more informed when making some of those critical calls on marketing strategies and tactics.
Here are five of the most commonly misunderstood characteristics of professional services marketing:
1. Marketing is a discipline that must be learned and honed.
Just as with accounting, law, engineering or management consulting, no one is born a marketer. It is a professional discipline backed by a body of knowledge. There are processes and tools that must be learned and practiced.
Many firms have a tradition of viewing marketing as a low-level administrative support function that exerts little real impact on firm performance. When approached in this manner, marketing will indeed have minimal positive impact on the firm. That doesn’t mean that it couldn’t, just that it is not being implemented to its potential.
In many firms, it seems that everyone is free to have an opinion about how marketing should be done. Yet we rarely allow uninformed opinions about accounting or IT security. Why is it okay to let marketing be guided by uninformed consensus?
As important as it is to have a competent accountant, attorney or human resources professional, it’s equally important to have a well trained, competent and fully funded professional services marketing function.
2. Marketing is more of a science than an art.
Once upon a time, marketing may have been based mostly on opinion rather than fact. That’s no longer the case.
With the rise of customer relationship management software, marketing automation and online tracking, it is quite possible to measure and optimize your marketing strategy. It is of course true that not every aspect of marketing can be predicted or controlled. But that’s also true for virtually any core functions of a firm.
Aside from any measurement you do on your own firm, there is a growing body of evidence about what works and what doesn’t work in professional services marketing. For example, we know that firms that specialize grow faster and are more profitable. We also know that doing research on your target market positively impacts growth and profitability.
We can measure the value of a new lead or the lifetime value of a client. We do not need to speculate. The cumulative impact of all of these developments is to reduce the role of speculation and hunches and increase the value of informed decision-making based on marketing analytics.
3. Marketing professional services is different.
While marketing is a broad professional discipline, professional services marketing is its own specialty. Just as all attorneys are not equally familiar with all aspects of the law or all technologists are not equally familiar with all types of technology, so too, all marketers are not familiar with the unique challenges of marketing professional services.
For example, the roles of expertise and trust are very different in marketing professional services as compared to consumer package goods or general business services. Choosing an accounting firm is not like purchasing an automobile or picking a vacation spot. While paid advertising may be perfectly appropriate for a restaurant, it does not work the same way with professional services.
Beware of anyone who trivializes the differences. Yes, a professional marketer can become competent in marketing your services, but don’t assume competence unless they have had the requisite training and experience.
4. Marketing should be at the forefront when it comes to important decisions on business strategy.
The discipline of marketing should help inform which specific markets you are going after, which services you are offering, pricing, introduction and promotion of those services, evaluating the client experience, developing strategies for increasing business with existing clients and evaluating and planning for mergers and acquisitions, to name just a few. Marketing input is as essential to sound decision-making as is financial analysis.
Think about it. Is it wise to launch a new niche practice prior to evaluating how your services will be received and its impact on the overall firm brand? Yet we see many firms making critical decisions first and only then thinking about marketing. Bad idea.
5. Marketing is arguably your most important business function.
Marketing is the only discipline that considers your client, your services, your competitors, your pricing and tracks the overall impact on your firm. Good marketing decisions drive faster growth, higher profitability, and a higher firm valuation. Uninformed, mediocre marketing strategies can have a negative impact and lead to unpleasant surprises.
One of the unfortunate characteristics of poor marketing decisions is that they may not be immediately visible. Uninformed marketing decisions may drive the firm in the wrong direction and you may not even realize why.
Time and again, we see firms over-spend on marketing initiatives that were doomed to fail before they started. Other times, a potentially successful initiative doesn’t get the appropriate level of resources. An experienced professional services marketer would not make these mistakes.
Marketing isn’t just about avoiding mistakes. It’s also about identifying and capitalizing on opportunities. We’ve seen many firms surge forward in growth and profitability when marketing assumes its appropriate role in the firm’s decision-making process.
The reality that so many managing partners misunderstand professional services marketing can be to your advantage. Understanding and fully embracing it can give your firm a competitive edge.
For a look inside how effective strategy and marketing can drive firm growth, check out Spiraling Up.
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