From “making rain” to predicting floods caused by rain, we look back at what we learned about professional services marketing, business, and life from our research, our podcast, and our clients in 2023.
One of the great pleasures of my life is the opportunity to lead a business where continuous growth and learning are critical to the success of the endeavor. We take this responsibility seriously and we’re highly appreciative of every client that trusts us with their marketing dollars and every reader that trusts us with their time. As a thanks for that trust, I share our 2nd annual “9 lessons.” Enjoy.
3 THINGS I LEARNED (OR RE-LEARNED) ABOUT PROFESSIONAL SERVICES MARKETING
Get to Know Rainmaker 3.0: For decades conventional wisdom has said, time and again, that professional services are an entirely relational business. “People do business with people they like” is the refrain that’s been repeated over-and-over again to me for the last 20+ years working with firms. Yet, as it turns out the most successful partners. The ones who really “make the rain” take a different tact altogether. They don’t focus first on building a personal relationship with their to-be clients. Instead, they focus on how they can offer real, tangible business value to them. Research by Matt Dixon and Rory Channer of DCM Insights recently published in HBR proved that the most successful “rainmakers” take a slightly different approach to business development. One that helps clients make sense of the noise, build consensus in their organizations, and learn from a wide variety of sources. Check out the podcast interview we did with them in October.
Balance is Critical to Growth: In our 2023 research into consulting firm marketing, we sought to take a close look at how mid-sized firms juggle the competing tensions of building new business with delighting existing clients. Ultimately, our research found that balancing this tension is critical to growing a firm. In fact, 81% of the fastest growing firms manage it “very” or “exceptionally” well while just 6% of their peers can say the same. As it turns out, managing this tension appears to be critical to driving firm growth. In our latest eBook, Excelling at the Intersection of Pipeline and Delivery, we unlock three approaches to making it happen – bringing the right mindsets, the right systems, and operational discipline to both sides of the house.
Specialization Drives Value: For years we’ve pointed to the critical need for professional services firms to make smart positioning decisions. To contract their market and their field of vision just enough to unlock meaningful growth. As counter-intuitive as it sounds, we continue to find the fastest growing firms are just more focused than their peers. They might be positioned around a market, a certain client type, or a technology, but their focus creates growth. And it brings value to shareholders. For more on that, check out this “Prof G” breakdown on the Alaskan Airlines acquisition of Hawaiian Airlines. He describes it as a situation where the “specialist crowds out the generalist.”
3 THINGS I LEARNED ABOUT BUSINESS IN GENERAL
A Compelling POV Can Be Worth Over $600B: For years we’ve also said that the most critical aspect of marketing a professional services firm is developing a compelling point-of-view on issues that truly, deeply matter to clients. I like to think of positioning and POV as a critical marriage of marketing concepts. This year, as I’ve watched the drama unfold around Elon Musk, I came to realize that a compelling POV isn’t only valuable to consulting firms. It’s highly valuable to virtually any business leader. As of the writing of this article, Tesla has a market cap of $811B. This is roughly equivalent to the market cap of the next nine automakers combined. That’s a group that includes Porsche, Mercedes, BMW, Ferrari, Honda, and Toyota. What separates Tesla from the rest? A POV. For all the chaos he brings with him, Musk had a clear POV for how mobility needed to change. His vision of an entirely electric future put Tesla at the center. That POV has enabled the company to grow without ever spending any meaningful dollars on advertising. It continues to drive value as automakers line up to adopt Tesla’s charging technology; making it the de-facto standard in more ways than one.
How to JOLT Clients Out of Indecision: As firm leaders how often do we find ourselves walking away from a prospect conversation thinking, “Wow that went well. We can create a ton of value for them.” Only to see the prospect slip away and go non-responsive. A startling 40-50% of professional services deals get lost to indecision. The central question is why? The latest research on this phenomenon points to a variety of reasons. The biggest ones seem to center around fear. Prospective clients frequently feel overwhelmed by the options in front of them. This leads to anxiety about making the wrong decision. Taken together, this creates a feeling of uncertainty about the outcome of the investment. As a result, they do …. well … nothing. In another groundbreaking research study Matt Dixon and Ted McKenna gave us all a blueprint for overcoming this. It includes offering recommendations, limiting the client’s information overload, and looking for ways to take risk off the table. Their book, The JOLT Effect, is recommended reading for the Christmas holiday. Also, check out our podcast interview with Matt.
Love Your Customers: We also had the pleasure of hosting Fred Reichheld, creator of the Net Promoter System on the Rattle & Pedal podcast this year. He shared his latest thinking on how to build a highly successful company by placing “customer love” at the heart of your strategy. In their latest book, Winning on Purpose, co-authored by Reichheld with Bain partners Darci Darnell and Maureen Burns, they offer new and better ways to measure customer loyalty beyond a simple Net Promoter Score. And they reveal how companies that make “love” their central purpose as an organization tend to outperform their peers. In fact, frequently they outperform dramatically – how does a 3x market return sound?
3 THINGS I LEARNED ABOUT ANYTHING IN PARTICULAR
AI is Improving Flood Prediction: Increasingly, flash floods (i.e. floods caused by extreme, unexpected rainfall) are becoming the most costly and dangerous types of floods. They can occur anywhere rain falls, which is practically anywhere. They’re incredibly difficult to predict. This is mainly because a good portion of the U.S. is unmapped for flood risk. And because many of the existing flood maps are out-of-date (like 10 years out-of-date). Finally, it’s also because most existing flood maps only account for floods caused by surge waters (i.e. hurricanes and over-flowing rivers). As it turns out, AI is proving valuable in flood prediction. Innovative companies, like Stantec (a Rattleback client), are investing in machine-learning technology to assign probability to flood risk in previously unmapped areas. It’s critical work and we’re excited to help raise visibility for it.
The Awe-Inspiring Power of Water: I guess our journey with water continues. This past summer we took a quick weekend visit to Niagara Falls. The power of the falls is simply astounding. No photo or video can really do it justice. Over 750,000 gallons of water flows over the falls every second. That water falls with over 2500 tons of force at the base of the Horseshoe Falls. And the ledge of the falls recedes about 1 foot per year. So, I guess the falls have receded over 40’ since my last visit … that’s about the length of a school bus.
Disneyland at Christmas is Disney-rific: A life well-lived is only well lived when we create time to spend with those we love most. For the 2nd year in a row, we decided to make a trek to the West Coast for a visit to Disneyland with our kids during the lead-up to Christmas. In our experience, Disney pretty much always delights but never more than during the holiday season. Even the biggest Disney skeptic would be hard-pressed to deny, the decorations and lighting are simply spectacular:
To all our clients, thank you for trusting us with your marketing investments. To all our readers, a heartfelt appreciation for offering us the valuable resource that is your time. I wish you all a fabulous 2024.
