Bureaux & Conference Organisers Marketing and Selling Professional Services Marketing and Selling Professional Services

Business Marketing Planning for Service Businesses

by Alan Patching

Research by a leading newspaper in the first week of December 1999 revealed that 41% of Australians made a new year's resolution to exercise and get fitter. In excess of 30% were to go on a diet. Just under 30% committed seek more balance in their lives.

I suspect that research in years before and after would show this was not another function of Millennium Madness, but rather the normal figures at the turn of any year. I also suspect research towards the end of January or anytime thereafter in any year would show that a great majority of the resolutions made a few days earlier would have already been broken.

I'd be surprised if the same situation didn't apply to business commitments. End of year holidays are the perfect time to bring to mind that business and marketing plan that keeps getting down-graded in priority as more and more urgent stuff invades everyday life and business. I'm going to suggest you schedule time (any time of the year will do) to think about business and marketing planning, consider what it would involve to incorporate into your busy life, and if it then sounds like it's worth proceeding with, to make a solid and considered commitment to do the planning and adhere to the plan.

Remember, commitment comes in a number of forms. The usual form is the 'lip service' variety which is not worth a cracker. Let's all aim for at least the next level up the commitment ladder, the 'considered' variety.

Here we don't even think about committing until we've considered thoroughly the impact of what we are committing to, weighing up the likely returns from the commitment against the cost of making the commitment, both financial and personal.

Regularly taking stock of where we are, where we want to be and how we intend to get there, a.k.a. business marketing planning, is a fundamental pre-requisite to business success. It always has been and it will always be. Sure, a lot of the planning for successful businesses has never been put to paper. Even for the deep thinking keep-it-in-the-brain type planners, why not do something a little different, jump out of the comfort zone, and try it on paper just for the sake of doing it by the book for a change.

What is business marketing planning?

In a nutshell, business marketing planning is simply an exercise in which we analyse aspects of our business, analyse the market and our competition in that market, and then match our strengths with opportunities available in the market. Having identified these matches, we then devise a plan to bring the matches from concept to reality using a series of marketing tactics.

Let's take a look at the steps involved. The first is the Internal Audit.

Internal Audit

Here, we take an honest, objective, realistic and completely unemotional in-depth look at all aspects of our existing operation. Following is a checklist of some of the things that definitely should be covered in our analysis:

  • The products and services we offer, including our market share and level of profit from each product or service or type of service or service.
  • Services which we do not now provide but could provide with a minimum of training or perhaps with enlistment of new resources.
  • The skills of our human resources. Look at all people and all of their experience and qualifications. Check the level of office / organisational morale and, if it's a little low, examine why and what we can do to change it. Beginning a marketing campaign with people who are not happy would be a complete waste of time, effort and money. Keep in mind we really are in the services industry, and therefore clients regard our people as part of the 'product' we sell. It's wise to be sure our complete product is very attractive to the market.
  • Identify distinctive competencies. I emphasised this point as I consider it to be the most important aspect of the internal audit exercise. The fact is we reduce the tendency for our clients to shop around for the best price when we offer a product or service not matched by the competition. These aspects of our product or service the competition cannot match, we call distinctive competencies. (You might see them referred to as 'unique selling propositions" in American books and articles). Any time spent trying to identify things you can package as distinctive competencies will usually be well rewarded.
  • I recall an example of a Mt. Isa based insurance broker who packaged policies specifically for the mining industry. He reported having the market in his area virtually to himself.
  • Image and market positioning. What do we want the market to think of us? Do we want to be seen as expert advisers to, say, the sporting fraternity, or perhaps the development industry? What behaviour patterns should we adapt to achieve this positioning? How can we consistently reinforce the image and position we seek?
  • What is the content and extent of our current marketing activity? Be brutally honest in examining this one. Do we have marketing procedures? Do we have a strategy? Is every marketing tactic matched to the agreed strategy before we spend money on it? Do we have a person responsible for managing our marketing? Do we have an up to date database of clients and potential clients? Does our plan have an arrangement for keeping in contact with the names on the database?
  • Technology. What technology do we use to run our business efficiently? How can we use modern technology to enhance our marketing?

When we have a brutally honest picture of the inside of our business, it's time to look at the environment in which we operate. This process is the second step in marketing planning and is known as the External Audit.

The External Audit

Here we examine the market and our competition in that market. The first thing to realise is our market is made up of a number of market segments.

A segment is nothing more than a collection of people with similar need of a particular product or service that we offer and who can be reached by a particular marketing tactic. (E.g. I once completed a marketing plan for a number of up-market retailers intending on setting up business in a building in Sydney. The market segments were determined as the people in the offices in the tower above the shops and those in buildings within 300 metres radius from the shops; workers in other business district buildings where the average income was 250% the national average; Japanese tourists; other international tourists; Sydney residents of upper socio-economic standard suburbs; travellers from other parts of Australia. Each group required separate marketing tactics if we were to effectively reach them.

In conducting external audits, it's wise to consider completing the exercise, at least in part, for each individual market segment. Then, if common results are found, the segments can be combined for the purposes of applying our marketing tactics.

Following is a checklist of some of the things you might cover in an external audit analysis:

  • Political, taxation and economic trends in the market place. (E.g., imagine property research shows a growing tendency for baby boomers to sell down to small apartments in the city and have a larger weekender within two hours or so of the city. Would this present any opportunities for your business?)
  • Market reaction to specific marketing activity. The growth in Internet marketing is a current example. How can this benefit us?
  • The competition. Who are they? Who are their clients? Which segments do they focus on? How successful are they in those segments? Who are their best people? What marketing do they use? What percentage of each market sector we target do they control? Are there any obvious weaknesses in their products or services? What do the customers/clients think of them?
  • What is happening out of our area that the customers like? Is it worth considering importing products and services that work in other regions or countries?
  • What people or organisations are in the market who we would like to do have on our team? Is a strategic alliance or merger a possibility?

Having gathered the information about the environment in which we will operate we are in a position to move to the next stage, where we seek out market place opportunities and identify threats.

The SWOT Analysis (analysis of Strengths, Weaknesses, Opportunities and Threats)

  • Be sure to complete the exercise for each identified market segment. We can then combine segments with similar SWOT profiles for action under specific marketing strategies and tactics.
  • Look for a critical success factor (CSF) in each market segment. These are the factors that stand out above all others as the key to success in a specific market sector. For example, your critical success factor in attempting to get to the 'dual income with kids' sector of a market for your financial advice service might be to conduct all meetings in homes. The CSF in reaching the inner city medical practitioners might be to become recognised as an expert speaker on superannuation for professionals in that field.
  • Identify your strengths and weaknesses. Again do this on a sector by sector basis. Determine this from the customer's perspective. The best numbers person on your team might be seen to be arrogant and boring from the customer's perspective. A junior employee who wins a Gold at the Olympics might know little about the details of the service you offer but could be a winner dealing with the 'just out of school and beginning work' market segment if correctly coached.
  • Analyse the opportunities and threats. Which segments are being badly serviced by your competitors? Could we set up a joint office in a country town with other non-competing professionals who see opportunity in the region?

You will be surprised how easily SWOT evolves from your internal and external audits if you take the time to do these properly.

Unfortunately, we often try to begin our marketing plan by simply saying 'what's an opportunity in the current market?' That's a bit like realising you have not got skis on half way down the slope.

Here are a few tips to consider after completing your SWOT analysis to ensure you get the maximum benefits from your planning:

  • Identify key issues and assumptions. A key issue might be the need to undertake concentrated training before commencing a campaign. It could be the need for a technological revamp of the office. It could be funding limitations which impact on the type of marketing tactics we can employ. Virtually every marketing campaign ever undertaken has key issues that must be considered and it will be the same for us if disaster is to be avoided. Key assumptions are those we make about the data gained thus far in the exercise.
  • We should identify these so we have a place to turn if the campaign we undertake is not meeting the success we anticipated. If the research is accurate and the results are not coming, it is usually because the assumptions we made about the data were not the correct ones. Record them in writing to save a bit of time in reviewing the success of your campaign. For example, you might consider you will offer an advisory service at very low fees to gain market penetration in a segment. If this segment is made up of people who consider low fee means low ability levels, your campaign is doomed to failure. If your data is accurate, you will be able to check your assumptions with that data after a couple of campaign months and quickly determine the cause of the problem.
  • Establish key objectives. The point here is all objectives in marketing campaigns should be solid and quantitative and not wishy-washy and qualitative. 'To improve market share" is not an effective key objective. "To increase revenue in this sector by 12.35% within eleven months, and with a profit factor of at least 15%" is.
  • Set key strategies. Our marketing strategy should always tie in with our business strategies, and we should never begin adopting tactics until we set strategy. For example our strategy for one market sector might be 'to win recognition from key decisions makers in an industry.' We might then set about delivering this strategy by employing a tactic to sponsor high level lunches with a relevant Member of Parliament or other high profile person speaking at these lunches.
  • Finally, consider the financial consequences. This is simply looking at the cost of the strategy in light of the value that it is expected to deliver.

That's the scientific part of marketing in a nutshell. It remains only to make the most important point of all.

Put the plan- all components of it - in writing.

It need not be any formal looking document, simply a handwritten record of the exercise that can be the basis of your regular updating of the plan. Marketing and business planning is a dynamic and not a static activity!

All that remains is for you to identify the tactics to best deliver the marketing plan you've defined, and that's the subject of a future paper.

For now, if you'd like a more comprehensive understanding of marketing and selling professional services the professional way, why not invest in our e-book How to Master the Science and Art of Traditional Marketing or Professional Services – in a nutshell, which can be sourced from www.alan.patching.com. If you don't gain a return of 10 times the cost of any of our e-books within one year of applying the principles it describes, the purchase price will be refunded without question.

Good luck with the strategic marketing and selling of your professional services.

This article is copyright. The author consents to this article being reprinted for personal use or publication, on the condition no changes are made to the topic, content and author's name, and the words "Copyright held by Alan Patching and Associates Pty Ltd. Alan Patching is one of Australia's leading business presenters and inspirational speakers." are included at the end of the article.

For more information on this and other leadership, management or project management topics, please visit our e-books page.