Well hello there! It’s been a long while since I’ve posted. Let’s see…coming up on two months!
I really need to spend more time on marketing the agency (of which blogging is a part).
The cobbler’s children are, indeed, shoeless – or more directly, we – along with most other professional services firms – suck at marketing ourselves.
It isn’t for lack of desire or inspiration – I mean, what’s better than having yourself as a client? I think of things I’d like to do to build our brand and client base on the daily.
Then 50 more pressing things sweep in and those sparks just fade away.
It’s about time…
Success in professional services comes down to whether you’re billing enough hours at a high enough rate to cover your expenses and make a profit.
In other words, if the loaded cost of a consultant is $100 an hour and there is no billable client work for them for an entire day, the firm pays them $800 ($100x8h) from reserves. But when that same employee is doing billable client work all day, the client is paying the $800 plus the fees that go to building up those reserves.
For the most part, non-billable hours are like your average teenager: they’re expensive and don’t contribute anything.
However, some non-billable activities can’t or and shouldn’t be avoided. Accounting and administration, for example, aren’t billable, but I wouldn’t advise cutting them from your budget.
While I believe marketing to be another such non-billable essential, some believe it to be more discretionary, but I think such attitudes are largely driven by uncertainty around ROI, which can typically be overcome with the right tools and processes in place.
Peaks and Valleys
Why do I think professional services marketing is so important? Because the firm that isn’t investing in activities aimed at keeping the sales pipeline full when business is good is much more likely to experience dangerous peaks and valleys in workload, and by extension, cashflow.
Put another way, while it may be counterintuitive, the time to invest in getting more clients is when you don’t need them. If you wait until you do need them, you’re probably too late.
Before I get into how a professional services operation might go about building a solid marketing practice, recall that my failure to keep up with our own marketing is what prompted this post, so I certainly don’t have a silver bullet solution; but I can offer some tips that may set you on the right path.
Like many things, marketing is often most challenging for new shops because their principals have to wear so many different hats. They’re likely part – and sometimes all – of the team that produces client work, as well as manager, accountant and janitor. As the owner of an agency that turns three in September, I know that there are times when you simply don’t have the bandwidth for anything beyond keeping the lights on for another day, so it may not happen straight out of the gate, but the firm’s principal(s) should seek to extricate themselves from producing client work as quickly as possible in order to focus on marketing and selling it.
Stages of Professional Services Marketing Maturity
Sound like a serious balancing act? It is. But it’s not impossible, and it is, for the most part; predictable. Unless you were sitting on a mountain of cash when you started your company, the path to professional services marketing maturity moves through three stages:
- Stage 1 – The Gauntlet. You’re just trying to keep the thing afloat, and that often means that little to no formal sales and marketing is going on. Often, making it to stage depends on whether the founder’s professional network can provide enough business to get off the ground. It took us over two years to get to the next there. And while that may seem like an eternity, just remember that many firms never make it. In my opinion Stage 1 is the toughest. But once we reached Stage 2, things started to fall into place and getting to Stage 3 doesn’t seem as daunting as moving beyond Stage 1 did.
- Stage 2 – Getting Out of the Kitchen. In this stage, founders and principals are able to delegate enough client and/or administrative work to dedicate at least 25 percent of their time to sales and marketing. At Mindtap, this phase began with lots of tweaks to the brand, messaging and even offerings; as we hadn’t really evaluated our messaging since launching the agency, and spending more time with prospective clients yielded some great insights.
- Stage 3 – Cruising Speed. It’s time to move on to Stage 3 when founder / principal is devoting 50 or more percent of their time to sales and marketing. In this stage, additional resources, such as a marketing lead, contractors or an agency with professional services marketing experience may be brought in to increase capacity, and dial the principal’s sales and marketing allocation back down to 25 percent.
As mentioned above, hiring for professional services marketing can come in the form of employees, contractors, consultants and agencies. But generally there should be at least one dedicated executive or senior-level marketer on staff in Stage Three, and that’s especially true if the firm is pursuing large accounts.
Most firms will gain some experience in hiring and working with contractors, consultants, agencies and the-like in stages one and two – even if it’s just to get their website designed and built – and that knowledge will likely be put to use as specialized resources are needed to execute the more sophisticated initiatives being driven by the marketing lead.
It’s worth noting that, while the percentage of their time that principals spend on marketing will decrease in Stage 3, they should remain meaningfully involved in sales and marketing initiatives because no one knows the brand and product better than they do, prospects will appreciate the high-level attention, and it keeps them in touch with what’s actually going on with their prospects, competitors and the industry at-large.
The one piece of advice I’d offer in regard to who gets hired to fill those new roles is to look for experience, knowledge and confidence and proven success, as hey should have the gravitas to work shoulder-to-shoulder with and secure buy-in from executives.
Balancing the more immediate gratification of billable work with the longer-term payoff of non-billable professional services marketing activities is a tricky but essential aspect of running a successful firm.
Despite that reality, many firms either choose to ignore it (“we already have too much business”) or they’re just too busy trying to keep client work moving through the shop to give it much thought.
To the latter, I say just push yourself and look for every opportunity get and keep the marketing ball rolling. As for the former, I’d advise you to look back and ask yourself if you’ve encountered any cash flow crises that might have been avoided had you put more time and effort into building your brand, pipeline and client roster. If you answered ‘yes,’ it’s probably time to reevaluate your strategy (or lack thereof). If the answer was ‘no,’ count your blessings, but also keep in mind that by the time you feel that you NEED marketing, it may be too late to stop the bleeding.