More than a decade ago, Hinge set out on a mission to understand what drives extraordinary growth in professional services.
This has been no easy task. We’ve witnessed the professional services industry undergo tremendous change in that time. Buyer behavior has shifted dramatically, recruiting and retention is harder and rapid advances in technology have left marketing departments overwhelmed.
But there is hope. Some firms have shown an incredible ability to grow rapidly in this environment. These high-growth professional services firms grew 5X faster than the average service provider. And they’re not just small- or mid-sized businesses, either. In our latest High-Growth Study, we saw rapid growth at every level.
What are the secrets that made this happen?
1 . High-growth firms were 67% more likely to leverage M&A
We’re seeing it more and more. Professional services firms are starting to pursue mergers and acquisitions as a primary growth strategy. In the study, we found nearly 38% of high-growth firms grew via M&A in 2018, compared to less than 23% of no-growth firms.
While there are many benefits of growing via M&A, it can present new, complex marketing challenges.
For example, in 2018 Hinge worked with several global, national and regional firms that had grown rapidly by strategically acquiring smaller firms for their specialized service offerings. The services they added were complementary and the acquisitions brought valuable talent with them, but the resulting “house of brands” lacked cohesive positioning and messaging. These firms shared a few common challenges:
- The need to understand the brand strength of their acquired firms to inform integration and communication plans (how much, how soon).
- The need to understand external brand perceptions to uncover common ground and help unify internal teams.
- The need to develop a repeatable strategic approach that can be applied to future acquisitions.
In each case we started with brand equity research, from which we were able to quantify the equity of each acquired brand and uncover potential synergies and areas of conflict. Ultimately, we used these insights to develop integration and branding strategies for future mergers.
By understanding and addressing these M&A marketing challenges, professional services firms are able to grow rapidly and maintain a consistent brand message.
2 . Differentiation is the top marketing priority of high-growth firms
If a professional services firm can separate its business from the competition it can win more business and avoid competing on price. Of course, differentiation is easier said than done. High-growth firms appear to be successful in setting their businesses apart. But how?
There are many ways to differentiate professional services firms, but truly impactful differentiators must possess three qualities. They must be:
- True – Your differentiators have to be grounded in reality.
- Relevant – If it doesn’t matter to your clients, it doesn’t matter.
- Provable – Anyone can claim a quality. You have to be able to prove it.
In addition to setting firms apart from their competition, a robust brand differentiation strategy allows firms to be more targeted in their marketing efforts, speaking directly to the most relevant audiences.
3 . High-growth firms invest more in marketing
Marketing is an investment of both time and money, and high-growth firms understand this.
When we analyzed marketing budgets, we found the high-growth cohort had a median marketing budget of 5% of annual revenues. Both average- and no-growth firms had median marketing budgets of 3%. Further, an impressive 36% of high-growth firms invested 10% or more of annual revenues in marketing (compared to 23% of no-growth firms).
Of course, not all marketing investment will show up on the ledger. High-growth firms understand the importance of doing marketing the right way. This is evident in the level of effort they put toward the marketing function.
For instance, high-growth firms are able to publish two guest blog posts a month while no-growth firms struggle to secure even monthly posts. They’re also 3X more likely to invest a high level of effort in webinars and, as a result, they’re experiencing twice the impact from this channel.
We also saw that high-growth firms are more than 3X as likely to publish original research as a part of their content strategy. We know from experience that doing primary research can be a significant investment, but many high-growth firms do not shy away.
4 . High-growth firms get the right balance of traditional and digital marketing
We noticed that the average marketing mix of high-growth professional services firms is very balanced. With half of their marketing mix focused on traditional channels like speaking engagements and networking events, and the other half focused on digital channels like SEO and social media, high-growth firms are able to reach their target clients in all the right places.
However, there is more to achieving high growth than having a balanced marketing mix. If a marketing message doesn’t resonate with target clients, or if shared content isn’t providing any value, it doesn’t matter what or how many channels you use. You have to get the message right first, then you have to amplify it on the channels your target clients actually use.
Below are the top digital and traditional marketing techniques most used by high-growth firms.
Top 5 digital & content marketing techniques used by high-growth firms:
- Email marketing
- Social media
- Case studies
Top 5 traditional marketing techniques used by high-growth firms:
- Networking events
- Speaking engagements
- Branded marketing collateral
5 . High-growth firms find a way to make their expertise visible
High-growth firms also tend to have highly skilled subject-matter experts on staff. By building awareness around these thought leaders and their expertise, high-growth firms are able to cultivate what we call Visible Experts.
Visible Experts are widely recognized thought leaders in their field. Other practitioners and media seek them out for their perspective and subject-matter expertise.
Rome wasn’t built in a day, though. It takes a lot of work to build the visibility and credibility to reach this level of thought leadership marketing. Signs of this hard work were more evident in high-growth firms than their no-growth counterparts.
In addition to their tendency to produce guest blogs more frequently, high-growth firms were more than twice as likely to have their subject-matter experts make guest appearances on outside podcasts. And they were 65% more likely to pursue strategic marketing partnerships with other organizations.
Doing this kind of marketing activity is a good strategy to expose new audiences to the perspectives of these subject-matter experts.
Marketing is more than the sum of its parts, and the firms that grow the fastest understand this. They take a strategic approach to marketing by focusing on what makes them different, exposing their experts to new audiences, selecting the channels actually used by their target clients and putting in the effort required to execute on this strategy.
High-growth firms are a bright spot in the professional services arena. They’ve overcome massive changes to the industry and buyer behavior, and they stand out with their exceptional marketing practices.
Fast growth is possible at firms of any size. Download the executive summary of our 2019 High Growth Study and start applying lessons learned from the best-performing firms in the industry.
About the Research
The 2019 High-Growth Study is an extensive market research report detailing the perspectives of over 1,000 professional services executives and marketing directors. We compared the fastest growing firms (those that achieved compound annual revenue growth of 20% or more) against firms that didn’t grow at all. By contrasting these results, we were able to identify what high-growth firms do differently — and what other firms can do to emulate their success.