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The
Marketplace MasterTM
is a monthly email publication on professional service
marketing from Expertise Marketing, LLC.
Welcome
When CMO
magazine ceased publication in January it left
a gaping void. What other publications focus on chief
marketing officers?
Perhaps
this month's article on goals for CMOs
will help, if only just a little bit. Please feel free
to forward it to your favorite CMO.
New
this month is a digest of some of my recent blog posts
from the Expertise
Marketplace. I'll make this a regular feature. I
hope you'll join the discussions and add your comments
to the posts.
If
you don't know your way around blogs yet, don't worry.
It's just like looking at a website. Each entry has
a comment link at the bottom. Go ahead, give it a try!
Suzanne
Lowe
Author, Marketplace Masters: How Professional Service
Firms Compete to Win
President, Expertise Marketing, LLC
Five Goals for Chief Marketing Officers of Professional Service Firms
Are
Chief Marketing Officers (CMOs) tuned into what really
makes them effective?
While
analyzing the data from the recent study
on marketing effectiveness I conducted with Larry
Bodine, I was struck by the way our study’s professionals
and marketers ranked the importance of their firm’s
strategic marketing goals. Their rankings reveal that
many professional firms (at least our study’s
377 respondents!) have a too-limited view of what their
CMOs’ goals could and should be. Professional
Service Firms (PSFs) are still marketing in “survival”
mode, and have not prioritized their CMOs’ goals
toward astute growth.
Our
research sought to help marketers learn about metrics
to achieve greater effectiveness for their marketing
strategies and tactics. In order to do so, we had to
find how well aligned marketers’ initiatives are
with their firms’ strategic marketing goals. We
suspected that a lot of marketers are wasting time and
resources measuring the wrong things. The results
revealed that many marketers are not focusing on the
goals that would increase their individual effectiveness,
nor help their firms move ahead in the marketplace.
Indeed,
I think professional firms should reconsider their traditional
notion of their marketing function altogether by focusing
on five stepwise goals that they should review annually.
If growth is the ultimate goal, they should make it
a priority.
Goal
1: Defining and identifying the most strategically important
prospects/clients
Too
many CMOs and their internal clients only know who the
most strategic clients used to be, not who
they should be now and in the future. There
simply is not enough rigor and focus on this ever-changing
group. Defining and identifying the most important “growth
potential” clients should be the foundation goal
for every CMO. Other strategic goals depend on this
foundation and, in many cases, are simply useless until
this one is met.
So
what did our study reveal about this goal? Only 19%
of the respondents ranked it as most important over
the last three years. Perhaps these respondents think
they already know who their most strategically important
clients and prospects are. But in reality, we suspect,
most firms haven’t truly assessed their most strategically
appropriate clients and prospects. Admit it:
even your firm says “yes” to too many potential
clients that won’t be very profitable for the
firm. Even your firm is vulnerable to serving
shrinking segments of the marketplace and missing out
on those that are expanding.
| CMOs
should ask themselves:
Is
it within my functional purview to analyze and
report on the profitability of current clients?
Should
I be leading our firm’s targeting and segmentation
studies and other market research to help define
and identify the most strategically optimal clients?
If
not, why not, and what will I do about it?
|
Goal
2: Acquiring the most strategically important prospects/clients
Study
participants ranked this goal second most important
of five strategic marketing goals in the last three
years. This goal has been the traditional purview of
professional service marketers, and it encompasses numerous
critically important
initiatives: differentiation, positioning and branding;
client value-added events; advertising; direct mail; publishing;
speaking engagements and numerous communications tactics.
This
goal is also highly important for business developers:
arranging business development appointments with prospects
and clients; responding to RFPs; presenting proposals
and other acquisition activities.
Of
course professional service firms need to acquire clients!
But considering our respondents’ high ranking
of this goal, I wonder how many of them are stuck in
continuous “acquisition mode.”
| CMOs
should ask themselves:
Is
it within my functional purview to evaluate the
cost of emphasizing client acquisition as a goal
over other critically important goals, including
client retention and growing our revenue with
those clients?
Is
our firm too often looking to replace revenues
from departed clients because their projects have
ended or because their loyalty has switched to
competitors?
If
a more strategic focus on this goal is not within
my purview, why not, and what will I do about
it?
|
Goal
3: Retaining the most strategically important prospects/clients
Respondents
deemed this to be their most important goal. Given the
economic environment in the United States in the last
three years (following a difficult recessionary period),
it’s no surprise that professional firms would
focus heavily in this arena. And professional firms
should be applauded for recognizing that retaining profitable
relationships is one of the most critical springboards
to real growth. (For a more in-depth discussion and
new research about the path to true growth, take a look
at Fred Reichheld’s book The
Ultimate Question)
CMOs
have excelled at the tactical marketing aspects of helping
their firms retain clients. Using CRM applications and
internal communication networks, they have done much
to strengthen their firms’ infrastructure to manage
client relationships. But much of professional marketers’
work toward this goal has been based on their historically
strong focus on communications. As their role
becomes more strategic, marketers will have to work
hand in hand with business developers and practice leaders
to manage key client accounts.
| CMOs
should ask themselves:
Is
it within my functional purview to lead my firm
to develop strategic account management plans,
and to structure a greater alignment with our
rainmakers and/or business development professionals?
Should
I guide my firm to become better about retaining
clients?
If
this goal is not within my purview, why not, and
what will I do about it? |
Goal
4: Increasing the firm’s amount of revenues with
its most strategically important current clients
Astonishingly,
respondents ranked this goal the least important of
the five strategic marketing goals. What!? Do these
firms not need to grow their books of business with
strategically important clients? Is retention enough?
This finding strongly implies that CMOs and
senior marketers are not leading their professional
colleagues to embrace one of the basic rules of marketplace
leadership: grow your revenues with the best clients,
and your competitors won’t. It involves
a keen focus on deepening the ties with loyal clients.
The
olden days’ marketer would simply communicate
more to the current stable of clients. Now, CMOs can
lead the charge by guiding their firms to develop innovative
solutions that meet their clients’ emerging needs.
| CMOs
should ask themselves:
Is
it within my functional purview to develop our
firm’s strategies to more broadly and deeply
serve our most strategically prioritized clients?
Even
if it’s never been done before, should I
be working with practice leaders to stimulate
the development of new services?
If
not, why not, and what will I do about it? |
Goal
5: Increasing the perceived value of the firm to all
audiences (including suppliers and employees)
If you want to see evidence of the evolution of the
professional services marketing, take a look at the
findings on this goal, which encompasses most firms’
public relations and media relations activities, as
well as internal marketing tactics. Respondents indicated
a serious split in their perception of what’s
important and what’s not. 40% of our respondents
ranked this goal as their last among the five, yet more
than 22% rank this same goal as their first among the
five. None of the other four strategic marketing goals
featured this amount of disagreement.
This
finding reveals that there is a distinct subset of professional
service firms whose main marketing goal is still largely
“communications” or “image”
and whose marketing orientation has not yet matured
to more tangible, client-focused, and measurable priorities.
If a firm has not yet identified its most strategic
clients (and worked to acquire, retain and grow business
with them), any efforts to increase its image may be
directed at the wrong audience!
| CMOs
should ask themselves:
Is it within my functional purview to help my
firm’s senior managers understand the importance
of prioritizing marketing goals that are more
meaningful, non-ignorable, and client-focused?
If
not, why not, and what will I do about it? |
Getting
Realigned
As
senior marketers shift their goals to be more strategic,
they may find the need to educate non-marketing professionals
about what it really takes to grow a professional service
firm in today’s competitive environment. Especially
in firms where the marketing function has focused mainly
on communications, there may be some resistance. In
most cases, resistance is more passive than overt, and
responds to “internal marketing.” The findings
of our study
provide great data for marketers to overcome internal
barriers to realigning their firm’s strategic
marketing goals, and simultaneously increasing their
own professional effectiveness as marketers.
What
the Future Holds
The
role of the Chief Marketing Officer, a title almost
unheard of ten years ago, will continue to expand in
the next ten years. Marketing is evolving from an art
into a science – and for professional service
firms, it’s about time. The sooner professional
service marketers can lay claim to “owning”
and leading the stepwise goals outlined here, the sooner
they can begin to increase their own effectiveness and
that of their firms.
Want
to see the results from our study on marketing effectiveness?
More
information on the complete 80-page study and its accompanying
68-page case studies report.
Take
the confidential, web-based Marketplace Masters professional
service firm differentiation assessment test for
instant feedback on whether your firm is doing differentiation
right.
If
you are interested in seeing the results of a small
study we recently conducted on measuring PR budgets
as a percentage of sales, please send mail to info@expertisemarketing.com.
Your
feedback is important to us. Please contact
us with your comments and questions.
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2006 Expertise
Marketing, LLC All Rights Reserved |
