Living in Peru : your everyday companion

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(By Marcos Wieland, Partner, Biztank Consulting)

Marketing is usually associated with consumer product companies. Nonetheless, for professional service companies (PSCs) - consulting firms, law firms, auditing, design, and publicity companies, etc. - the decision to adopt this practice shouldn't take a back seat. PSCs should understand the essence of marketing, how to adapt to it and, especially, its impact on profits.

The subject of marketing has always existed: presenting a proposal with value to a group of clients so that it is profitable and sustainable has been and continues to be the reason for any company or business to exist.

To the extent that marketing has been evolving, the understanding of formal marketing and its value for the organization became generalized. From being seen as only appropriate for companies of mass consumption goods (B2C), marketing is now also being valued by companies in other sectors in which the client is not necessarily an individual. 

Particularities

In order to analyze marketing practices for PSCs and its difference from conventional marketing, we should first point out some particularities.

First of all, we have to consider the nature of services. They are produced and consumed at the same time and, in most cases, together with the client. Thus the quality of the service to be delivered (the product) and the administration of interaction with the client become critical factors for the business. For this reason, marketing is usually decentralized and becomes the task of all professionals who are in contact with the client. This role is diminishing however, for two particular reasons: the little understanding of its importance by professionals, and the fact that this task requires time investment which can not be billed directly to the client. Thus marketing becomes a difficult effort.

A second distinctiveness is based on the type of relationship established with the client. Most of the time this consists of a recurrent relationship that is highly personalized and based on a very high level of trust. This has certain implications that must be kept in mind. First, personalization demands from the professionals of the organization a high and continuous level of effort in order to better understand the client and his industry, with the goal of anticipating his needs. Secondly, as these services are repeatedly provided to each client, it is important to differentiate the clients with respect to their value for the company over time. Third, trust is built through repeated interactions with the client and it becomes a key asset on which the well-being of the company name is based.

Finally, a third particular aspect is the essence of the offered services: understanding and experience. As PSC organizations are oriented in translating accumulated understanding and experience into value for their clients, they must achieve their positioning as "think tanks" in their area of expertise, which will reinforce trust that clients, and the market in particular, have in the company and its professionals.

Marketing Process in PSCs

With respect to strategic definitions, and given the above mentioned particularities, it becomes clear that product or service differentiation is not sufficient within the current business context. PSCs have to choose certain strategies to differentiate its clients by value and orientation in which marketing becomes more a question of relationships than transactions.

A segmentation must be made not only on the basis of service products that are sold to certain client groups, but also on the basis of common needs of each sector or industry.

On the other hand, as a result of adopting a strategy based on relationships, segmentation must also be made on the value that client groups or segments have over time.

Client differentiation is also critical for the development of value proposals that are highly personalized by the knowledge of the client's needs, as well as his industry and the current potential value for the organization.

At first glance, this looks simple. However, it requires a change from the previous product approach paradigm. This change, as it will generate a series of challenges for the organization, must be managed in a premeditated fashion.

Operations

As a result of the nature of the relationship with clients mentioned previously, their retention and development are objectives that are of equal or greater importance than attracting new clients. Many times it will be more profitable selling more products or services to existing clients than winning over new customers. This is an important consideration to take into account at the time of defining sales budgets and respective plans for the generation of demand, and should be added to the criteria of differentiation by segments. The way to reach clients will be more direct and personalized than massive, and should be done through interactions in which the value of the company and its professionals is made evident.

A sales cycle ends with the sale and delivery of a service, stages by which the personalized value proposal should be made tangible.

Finally, given the recurrent character of provided services, it will be crucial to close sales cycles by assuring client satisfaction through feedback. This information also adds to knowing and understanding clients.


Positioning the brand

For a PSC, the brand name is a fundamental asset that represents and communicates the value of the firm and its professionals to the public. This value must not only be continually maintained and reinforced, but also made evident through the participation of the firm’s professionals in lectures, seminars, courses, and other public relations activities.

Finally, it is clear that beyond the understanding and knowledge of certain market characteristics, professional service companies must adopt formal and proactive marketing practices. The opportunity is too large to waste, and in doing so, the company runs the risk of falling behind a growing competition and losing its competitive edge in the eyes of the market in which it operates.