Reprinted with permission from Professional Marketing Magazine, published by the PM Forum North America, www.PMForumNA.org
In today’s sophisticated marketplace, professionally marketed and managed services stand the best chance of gaining notice and winning market share. What’s true for consumer goods, health care and telecommunications, also applies to professional services such as those offered by CPAs and lawyers. Many firms that have acknowledged the need have been richly rewarded. Those that have embraced the need and acted on it have seen even more impressive results.
Playing Catch Up
Product marketing and management brings discipline to professional service introductions, as it does to other types of products and services. Whether the product is a widget or an audit, the idea is the same: use product management techniques to create, design, develop and bring to market new offerings. Excellence can only be anticipated if the fundamentals of product management are in place.
For decades, this functional discipline has been a mainstay of corporate America, first as applied to traditional products, and later to services. Now professional service firms are borrowing and modifying best practices to expand opportunities and to identify new growth areas.
Historically, accounting services have not provided much opportunity for marketing. For the most part, the offerings have been characterized, and constrained, by regulation. Where the creativity came in was not so much in how the work was offered or packaged, but in how it was performed.
For example, early in my career I was an auditor, first for Arthur Andersen then later for Price Waterhouse (now PriceWaterhouseCoopers). The two firms had quite different audit routines, work paper techniques and client interface protocols. Within stringent frameworks, they devised quite distinctive ways to deliver similar offerings.
Today, the accounting universe is still guided in large measure by rules and regulations, such as those surrounding audits and the development of financial statements for publicly held companies. On the other end of the spectrum is a variety of activities now performed by CPA firms that were not their purview in the past, such as financial analysis consulting.
In the middle are regulated offerings that offer some leeway. Examples include financial planning, which may involve regulated investment management and insurance products, but also calls on creative, non-regulated problem-solving strategies.
As in any business or profession, leveraging revenue growth is a matter of standardizing and replicating the offering. That’s where the tools of professional product management have a great deal to teach us.
In my experience, marketing the professional service product is best achieved in a systematic way that borrows from industrial and consumer marketing techniques, adapted for our needs. In order to breathe some life into these steps, I have imagined an example in the field of internal controls, an area of enormous opportunity in today’s fraud-aware corporate environment. For our illustration, the fictitious Smith & Jones CPA firm is conducting work for a privately held company. This entity may not be required to conduct internal control assessments, but we believe the company would benefit considerably from assessing and enhancing its existing internal controls program.
In the past, Smith & Jones might simply have hung out a shingle announcing “Now Conducting Internal Control Assessment and Implementation.” Today, the offering must be thoughtfully created, refined and presented in order even to be considered, let alone adopted. The process I recommend is summarized here. Although there is some linear association among the steps, they can and should be pursued concurrently, with information gleaned for one used to inform the next, wherever it is on the list from one to seven.
- Identify the problem or need.. It’s as basic – and as essential – as it gets. What are you offering and how does it solve a potential problem faced by the prospective client? What aspect of his or her business will this facilitate? What will it give the client that he or she desires, such as increased profitability or visibility? In the case of internal controls, the benefits list might also include credibility with key audiences, including regulators and shareholders. The prospect was doing quite nicely before you darkened their doorstep, so you need to dig deep for needs and apply your best creativity in seeking out the problem – not just a superficial symptom posed as a problem.
- Determine the perfect prospect profile. By reaching out systematically to clients and contacts, the folks at Smith & Jones will learn that certain industries are far more sensitive to the need for internal controls than others. They may find, for example, that manufacturing companies are an excellent prospect because they manage considerable inventories. As such, they have a great deal at stake; internal controls would likely be welcomed as a risk reduction strategy. Determine not only the industries that would be appropriate, but the characteristics you seek in a buyer. Articulate these and compare your thoughts with other team members.
- Define and describe the overall concept and methodology. Here is where standardizing comes into play. Like other market-ready products and services, the internal controls offering cannot exist as an amorphous “good idea,” but must be thoughtfully organized and offered; in marketing terms, “packaged.” Smith & Jones must do its homework, for example laying out a schedule of offerings appropriate to different-sized firms. Perhaps research reveals that for a manufacturing company between $5 and $50 million, a one-day initial internal controls assessment is the most effective choice. But for businesses between $50 and $100 million, a more extensive assessment is required. So, the offering is honed, shaped and readied for market, with two “models” for differently sized prospects.
- Identify major components of the offering. Once the overall concept and methodology are established, these must be fleshed out and articulated, first within the firm, and secondly through marketing materials and knee-to-knee encounters with prospects. For example, perhaps the assessment will look at internal controls relative to cash, accounts receivable, and balance sheet items. The Smith & Jones team decides, say, that strengths and weaknesses in each category will be assessed to determine where the client is in good stead and where additional work is needed. Ultimately, an appealing menu must be developed that will attract clients hungry for this offering, not because it is mandated by law, but because it helps the client more successfully meet customer needs and business goals.
- Determine the value proposition. “Where’s the value?” savvy clients demand to know. As well they should. As part of Smith & Jones’s product marketing and management efforts, the value of the targeted offering must be quantified and clearly communicated. Spend some time listing the relative value and benefits of each specific feature of the offering. For example, a benefit of an internal controls assessment might be greater piece of mind and a reduced level of risk. Determining value translates into the assigning of prices. The firm must do their homework to estimate how much the various features and benefits are worth in the market. Hint: ask some prospects before finalizing initial pricing. Re-pricing should occur as demand and competition fluctuate over time.
- Create the proper market positioning. Positioning involves matching an understanding of the buyer needs with your solution, and comparing competitive offerings to determine how yours might fit into the competitive environment. Pricing, quality, service and distribution are all part of the process. Positioning allows Smith & Jones to align its internal controls offering ahead of others. One marketer refers to it as “perceptually locating” your service, by differentiating yourself in the marketplace. If Smith & Jones is not the only CPA firm offering specialized expertise in internal controls, it must come up with value-enhancements – ways of approaching the work that will close the deal in its favor.
- Name It. A name is the embodiment of successful positioning. A name, and particularly the right one, announces to the marketplace that your service has been crafted and made ready for consumption. Like other parts of your service package, it should meet a specific need and suggest a positive solution to an acknowledged problem. A client of mine recently decided to name its eldercare line of services Aging Advisory. The logic is that the “elder” in eldercare connotes the services are for seniors only, when in fact the offerings appeal to a broader audience.
Stepping up to the Plate
Using the above process, Smith & Jones has readied its offering for the marketplace, giving it the best possible chance for success. As the service evolves, these same steps provide a valuable method for identifying new opportunities. For example, if Smith & Jones learned that 80 percent of internal controls around inventory at client companies were substandard, it might wisely choose to launch its next offering around this specific need.
Professional service firms may not be at the level of consumer goods and services when it comes to honing their offerings, but just give us time. As more and more practitioners see what a little professional product management can do, I believe they will want to join the parade, presenting their best face for the consuming client.
May the best “product managed” services, supported by the best “product marketing”, win!
Suggested Reading: “Market Leadership Strategies for Service Companies” – Craig Terrill and Arthur Middlebrooks