There are countless metrics for rating professional services firms: repeat business, expertise, reputation, technology, hit rates… take your pick. But just as important as any of these metrics (if not more so) is how potential buyers perceive your firm.
No problem, you think. You know how your firm is perceived and you feel good about it.
But do you really know?
It turns out that professional services firms and their clients have very different perceptions about a great many things. We’ve compiled a new body of independent research based on interviews with 1,500 buyers and sellers of professional services across five major industries, as shown in Figure 1. In order to study both sides of the relationship, these individuals were matched. In other words, the buyers are those who purchased services from the sellers.
The results of the study are startling.
When asked about buyers’ top business challenges, A/E/C sellers dramatically underestimated the importance of each (Figure 2).
Without an accurate feel for the gravity of their clients’ issues—or which problems weigh heaviest on buyers’ brows—how can a seller effectively engage their clients in problem solving?
The differences in perceptions don’t end there, however. When asked about the importance of sellers’ services to solving buyers’ top business challenges (cited in Figure 2), buyers across all industries found the services to be less important and relevant than sellers believed. However, the size of the perception gap varied greatly between industries (Figure 3).
Look, in particular, at the variation between the technology services and A/E/C sectors. About 40% of sellers in both of these fields rate their services as extremely important in addressing critical business issues, but only 10% of buyers in the technology industry agreed. A/E/C firms, for their part, still overrated the value of their services for solving buyers’ top challenges by over 25%.
Adding more ambiguity, professional services and A/E/C sellers and buyers rarely agree on exactly who the competition is for any given problem-solving effort.
One likely reason for this disconnect is that firms have built their competitor list from an industry insider point of view. Assumptions built on intimate knowledge of other firms’ expertise inform their ideas about likely competitors. But buyers don’t know the industry so well. They won’t assume, like you might, that Firm X doesn’t have a history of solving particular sets of problems or employing specific tech tools (unless, of course, you tell them).
As you can see, Professional Services firms and their clients hold differing views on key issues. Sellers are doubly vulnerable because they often overvalue the importance of their services while misunderstanding their competition. Now let’s talk about solutions. Conducting research on target clients is key to bridging these perception gaps and driving both growth and profitability.
Even occasional research (less than once per quarter) can increase growth sevenfold, and frequent research (at least once per quarter) by nearly a factor of twelve. Discover which clients and prospects have needs that are in line with your services and narrow your focus. Specialize in industries and firms whose challenges are directly in line with your solutions. And when your perceptions don’t quite line up, take charge of the narrative. Crucial to any buyer’s decision-making process is the belief that a particular professional services firm has a strong understanding of the client’s needs and how to address them.
Challenge your own perceptions, and your clients’ as well. Inform them about just what you can do for them. With research and careful communication, your ability to problem-solve for clients will quickly grow—as will your business.
Sylvia Montgomery, CPSM is a Senior Partner at Hinge. At Hinge, Sylvia provides strategic counsel to national clients. She is a co-author of Inside the Buyer’s Brain and Online Marketing for Professional Services. Sylvia has an MBA from University of Maryland, University College; an MFA from the George Washington University and a BA from Trinity University. You can find her on Twitter @BrandStrong.