What should be keeping managing partners awake at night?
Four questions you should ask in order to prepare for future marketing challenges
There are thousands of professional service firms around the world actively marketing their firms on a daily basis. Those who get it right focus relentlessly on the vision of the business. They have deep understanding of the marketplace in which they work and align their activities accordingly. They will ask:
How loyal are my clients?
Only a few weeks ago a potential client told me that one of their long standing clients of over 50 years was leaving to move to a Big Four firm. Naturally they were quite upset but given the company had recently been acquired it was not unexpected. When it comes to attrition, around 5-7% of clients leave a firm each year. The goal is to keep those percentages from rising and possibly reduce them.
Think about the needs of your clients – are they looking for strategic advice, or just compliance? If it the latter, you may need to change your pricing accordingly.
Who are our competitors?
The Big Four, Google and Amazon have all been mooted as new competitors for legal and accountancy firms alike.
The Big Four are leading the trend of accountancy firms offering legal services, while continuing to work with law firms in areas where they do not compete. In a March edition of The Economist this year, Michael Roch of Kerma Partners, said the Big Four are “the biggest underestimated threat to the legal profession today”. The article goes on to discuss the Big Four not building full-service firms, but instead concentrating on areas of law that complement their existing services.
The Big Four are also moving into the SME space usually owned by mid-tier accountancy firms – both PwC and KPMG have developed an offering for small to medium sized enterprises.
Earlier in the year ICAEW quoted KPMG’s Head of Enterprise, Ian Moffatt, as saying “In the next five years, are big accountancy firms going to be our competition, or is it actually going to be Google, or Amazon, or somebody else?”
How effective are our marketing efforts?
How do you measure something that is difficult to measure? Placing a tangible value to a firm’s marketing efforts can be challenging. You need to ask what has going well and what could be done better. What are the challenges or blockages that stop your firm from achieving its goals? Do you need to re-prioritise your activities for next year? Do you have systems in place to ensure you are working efficiently and effectively?
A big challenge is the gap between marketing and the rest of the firm. If firms wish to generate more income in a cost-effective way, the marketing function needs to be fully integrated into the firm and evolve with the business accordingly. Conversely, saying your marketing people are your business partners doesn’t make them that unless you have marketing people who are commercially aware and fully aligned with your firm’s business strategy.
Are we planning for the long term?
The economic climate of recent years has meant that many firms may have been tempted to focus on short-term activities and immediate needs – some have focused on client retention, others on winning new business. But if we lose sight of we want in the long term, we’re far more likely to make the wrong decisions in the short term.
This means thinking strategically and investing in long-term activities and not only looking at the next 6-12 months. Market penetration and brand recognition requires years of strategic planning and implementation. It demands a clear understanding the firms’ long term business goals.
It is no longer acceptable for firms, regardless of size, to think of their marketing function as separate from the rest of the firm. Firms need to take a long-term view and align marketing with the business goals, and the needs of the clients. This means thinking strategically about who competitors are and what is the potential impact they may have on the firm. It means responding to day-to-day demands while remaining focused on the long-term goals.
Founding Director, Horigan Professional Services Marketing
Contact us to find out how we can help you review and benchmark your marketing activities.