What would happen to a law firm or an accountancy practice if, tomorrow morning, your largest client rang to say that he is moving his business elsewhere? Or if two of your largest clients stopped trading within months of each other? Would you have enough new business to cover this loss?
If statistics are anything to go by, many small firms and large firms within the professional services industry would find themselves in dire straits. The problem for many is the old 80/20 rule - 80% of their business comes from 20 % of clients. That is not necessarily a bad thing, but in a competitive market and with the economy still weak, relying on existing business is not always the best strategy. The trick, as ever, is to find new clients while cross-selling or making more from your existing clients. With markets now opened up and both law firms and accountants able to offer competitive services, the need for Client Development is at its highest.
For the professional services industry, client development is the most difficult part of the business. Finding the right way to market a practice is becoming an expensive learning curve, but there are those in the Business Development who have proven means of showing a Return On Investment (ROI).
All that hard work and no immediate results….but you need to sow the acorns to grow the solid oak trees.
'Marketing and selling are not the same and yet the professional services industry often mistakes the two' says Edward Simpson of EMDS Media Relations 'Marketing is very much a long term exercise. You could spend hours or days defining or researching with no immediate results. To the timesheet-orientated professional, that's a waste of time and money'
Maybe. But as Simpson points out, making sure that your existing clients are getting exactly what they need and that potential clients are constantly reminded of your brand will eventually reap dividends.
Existing clients are the source of your income stream and, most probably, a handful of major clients will be the mainstay of the practice. But existing clients are also the foundation of the referral network, and the strength of word of mouth should never be underestimated. The ability for example to answer queries form clients quickly will not cost but will make clients happier. Providing regular face-to-face meetings, again for free, to your most important clients will add a service and quality (whilst also identifying any new cross selling opportunities and any problems might occur with them providing new business or renewing say an audit. Some practises have an annual meeting with their clients from a neutral partner.
Many Accountants and Lawyers do not necessarily become natural sellers of their services, but there are ways to get them to sell without their realising that they are selling.
Hence the need to employ or consult with outside professionals. Marketing in the Professional Services Industry is fizzling out and being replaced by Business Development. Where a football manager is responsible for the performance on and off the pitch so to is a Business Development professional. Gone are the days of 'lunch' ….results must be shown.
For example companies already have costs associated to processing and maintaining their web sites. Mondaq a well known online publishing house www.mondaq.com can process all your content and put it on your site. Thus saving salary's of say 2-3 staff. The service that Mondaq offer after is unique. The same content will be distributed to a potential audience of 3.5 million potential business users globally through agreements with Reuters, Bloomberg, Dow Jones, Lexis-Nexis, Westlaw and their own internet distribution network (Ft.com for example and their own web site with over 170,000 registered users). This all sounds fine but how can you see a return on investment? Each Mondaq client has the offer to connect to a management report which shows valuable information as response rates, who has looked at the article, their contact details, and to be in touch with a potential client at the time they are looking to buy.
By looking after your existing business and your potential market place you can make a business plan that allows you to hit targets and understand better the competition. This allows you the control on decisions that will ultimately allow you to operate a successful practice.
Edward has 14 years in the professional services industry and is contactable info@emdsmedia.com
The content of this article is intended as a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.