Most of my articles have focused on start-up business development for two reasons: First, people come to Built In Chicago to read about start-ups and, second, they represent a large portion of my client base. However, as a more diverse group finds its way to this site (and to my business development consulting practice), here is one for the Professional Services readers among us.
When start-ups bring their newest, most innovative technologies to market, traction can be difficult to gain and maintain because, as I’ve discussed before, the technology will not sell itself. It is up to those entrepreneurs to demonstrate not how innovative their products are, but the vitally important solutions they represent. The customer does not understand the value until it is demonstrated.
Professional service firms, particularly in marketing, communications, staffing and technology development, tend to suffer the opposite problem: a perception of commoditization. While many start-ups are considered too innovative to be relevant, many professional service firms are considered too commoditized to be differentiated. Surprisingly (or perhaps not), the solutions to the two phenomena are quite similar.
The websites and sales presentations of professional service firms have one pretty universal, yet simultaneously ironic, thing in common: the “What makes us different” section. Within any given industry, these narratives are often virtually indistinguishable (because, let’s face it, what firm doesn’t consider itself a client-focused, forward-thinking, industry expert?). The path to de-commoditization depends on presenting clients with solutions, not capabilities.
Highly technical start-up founders tend to identify systemic underlying problems and struggle to frame their products as surface-level business solutions. Professional service firms, however, face the opposite challenge: solutions that only address superficial issues related to their fields of expertise. As I always say, nobody hires a new professional service firm because everything is going well… The first step in presenting services as solutions is demonstrating an understanding of the root cause of those perceived surface-level problems.
If you are a marketing agency, you need to understand why the client has poor brand recognition. If you are a staffing firm, you need to know the reason your customer has difficulty finding and retaining talent. If you do web development, it’s important to understand why the client’s customers spend so little time on the site. Superficial problems have superficial solutions – enter the commodity service providers competing on price, speed and capacity: all say they are “different,” yet all present the same. None of us need brand name duct tape, garbage bags or hand soap.
In order to stand out when selling services, it is of the utmost importance to solve the problem, not temporarily alleviate its symptoms. Commodities are priced by the market; solutions are valued based on the revenue they generate or the costs they reduce. So, how do service firms cement their positions in the latter category when pitching new business? By going in with a firm grasp on the overall state of their customers’ companies, what keeps their executives up at night, and what is going to truly contribute to bettering their businesses.
Reframing business development in these terms is not always easy. Even if the idea makes sense, where to begin can be difficult. My (not unbiased) recommendation would be an email to me. My consulting practice is devoted to helping start-ups and professional service businesses alike navigate business development challenges, and I would welcome the opportunity to discuss your de-commoditization needs.
Dan Palay is a Chicago-based consultant, specializing in marketing and business development for early-stage and business service companies. Please feel free to contact at [email protected].
