Saturday, March 23, 2013

What Are the Best Online Marketing Practices?

There are no aspects of selling that technical professionals struggle with more than cold calling and lead generation. Wouldn't it be nice if more prospective clients contacted you with leads? That's the most tangible result of effective marketing, and these days the best marketing practices are increasingly moving online.

Last week I mentioned the research of the marketing firm Hinge that examined online marketing for professional services. They found that firms that generated more leads online enjoyed faster growth and higher profit. The difference was particularly pronounced among A/E firms, which generated the fewest proportion of leads online (8.3%). Yet those that generated at least 40% of their leads online had a median two-year growth rate of 100%, compared to only 0.7% for all A/E firms.

Of course, it's impossible to know how much their online marketing success contributed to that growth. But the correlation between effective online marketing and overall success seems clear. So what are the most successful firms doing online? The first chart below shows the relative focus that high growth firms gave to certain online practices compared to average growth firms in the Hinge study:

Among all professional service firms surveyed, the online activities that garnered the most attention were email marketing, company e-newsletter, SEO, and use of LinkedIn. But blogging emerged as most popular among high growth firms, along with website optimization, social media, and publishing. The emphasis given to these different practices by high growth firms, as you might expect, generally aligned with their assessment of how effective they were:

How would your firm rank the different online marketing practices based on how you use them and how effective they've been? Are you doing the things that have produced the best results for other firms? Let me offer a few thoughts about those practices at the top of the chart:

Search engine optimization. There's a common misconception that the best way to increase your Google page rank is to buy Google AdWords. But increased visibility on the web's top search engine (and others like Bing) is something you have to earn, not buy. There are many things you can do for improved SEO for your website, but reputedly the best is to attract more incoming links. Why would people want to connect to your site? Because you offer valuable content that's being regularly updated. 

Blogging. I'm surprised to see this listed so high, because my previous research of best marketing practices has not given blogging high marks. But blogging has some notable advantages when it comes to SEO. It's said that Google favors blogs, in part because they attract more incoming links and have dynamic (regularly updated) content. Therefore, a good way to make your website more visible is to add a blog to it (assuming you keep it updated).

There's another value to blogging apart from it's direct marketing impact. Blogging should motivate you to keep producing content, and content is king in marketing professional services. I've been blogging for five years, which has resulted in over 260 posts on different topics. Those posts have been converted into over 50 articles appearing in various print and online publications. They have served as the starting point for many conference sessions and webinars. And I routinely share them with sales prospects and clients. In other words, the value of blogging extends far beyond the blog itself.

Email marketing. With blogging you create content to pull in an audience; with email marketing you push the content out to them. The core principle is the same—you must have something useful to share. But the big advantage of email marketing is that you don't need to create your own content. 

I publish a monthly ezine that goes to hundreds of people who requested to receive it. I always feature one or two of my blog posts, but most of the content I link to is by other authors. Of course, it's best to write some of your own stuff. But you can still provide a service to your readers (and thus valuable marketing for you) without committing to the rigors of producing in-house content.

The Hinge study broke out company e-newsletters as a separate practice. I must confess that I'm not a big fan of the typical newsletter that amounts to a commercial about the wonderful things happening at one's firm. If you must do this, please give attention to topics of interest to clients. If you've not really stepped into the world of email marketing, this previous post might be helpful.

Social media. I've admittedly been slow to warm to social media because the early hype for it far exceeded the marketing results. But as the Hinge study and other sources indicate, many professional service firms are apparently getting good returns on their social media efforts. Once again, I'm convinced that good content is key. What makes you relevant in the social media sphere is having something of value to share.

While I'm hardly a great example of how to market online, my recent experience illustrates its multiplying potential. I've had a couple of blog posts picked up by in the last month, which they've circulated through their blog, newsletter, and Twitter. That drew a large audience—over 8,000 in a few days—with numerous retweets and links on Twitter. A few people contacted me via email because they'd read my post, and one executive outside our industry looks like he will soon become a client.

So I've got good reason to take steps to strengthen my online marketing in the coming months. Shouldn't your firm? Again, I encourage you to download the free ebook summarizing the Hinge survey. I also recommend Hubspot's excellent free ebooks on various internet marketing topics.

Friday, March 15, 2013

Online Marketing: Are You Getting Results?

I wouldn't call myself an expert in online marketing. But as a sole proprietor, I do more online marketing and get more results than most of my A/E firm clients. Increasingly, prospective clients are contacting me because they've discovered me on the internet. And that's a good thing, because I don't have much time to make sales calls.

The internet is a great equalizer. Someone as insignificant as me can be read by tens of thousands of people around the globe. Type the phrase "A/E firm consulting" in Google and my website comes up before much better known competitors like PSMJ and ZweigWhite. I'm buoyed by the fact that my next new client might be someone I've never met who's admiring my work somewhere out in cyberspace. Someone like these individuals who first contacted me by email and recently became clients:
  • "He (the firm's president) has been a fan of yours for some time. He frequently forwards your articles to our core management group."
  • "I am a fan of your blog and would love for them (the management team) to consider your consultant services."
  • "I am a fan of your blog and I'm interested in talking to you about possibly doing some in-house training for us."
I share these only to inspire you. To be honest, I don't do online marketing particularly well. I have this blog, a monthly email newsletter, and a resource website. I do a few webinars through professional associations. I dabble in social media like Twitter. I've slacked in submitting articles to various online publications as I once did. And I don't know squat about SEO (if you don't know what that means, you know even less than I do).

Yet I'm getting results. 

What about your firm? How many leads has your online marketing generated? How many new clients first learned about you online? If those questions make you a bit uncomfortable, take heart, there's help available. The marketing consultancy Hinge, for example, knows something about online marketing for professional service firms. They conducted a survey of 500 firms to discover what practices produced the best business results. Here's a sampling of their findings, as summarized in their book Online Marketing for Professional Services:

A/E firms generate fewer leads from online marketing than other professional service firms. Unlike other similar surveys, our industry was well represented this time, with almost 37% of responses coming from A/E/C companies (the largest segment of the survey). But we generated the smallest proportion of leads from online marketing—8.3%. Marketing and communications firms, by comparison, derived 31.4% of their leads from online activities.

Is that a factor of our marketing efforts or our clients? I suspect it's some of both. As noted earlier, most of my clients don't even equal my meager effort in terms of online marketing. Particularly missing from these firms' approach is effective use of valuable content. Hinge also found an inverse relationship between leads produced online and the percentage of revenue coming from government contracts, which accounts for a large share of our industry's income. Since government buyers follow a more formal procurement process, they are probably less influenced by online marketing.

Firms that generate more leads through online marketing grow faster. Those that didn't generate leads online had a two-year median growth rate of 15% (most A/E firms would be happy to have grown at that rate the last two years!). The growth rate increases as firms generate more leads online—to a point. Firms that derived 40-59% of their leads through online marketing had the highest two-year growth, almost 64%. Beyond that, growth dipped a bit, but still averaged above 50%. This may suggest that it's best to employ a healthy mix of lead generation tactics, but you clearly don't want to ignore online.

The most profitable firms are those that generate a large proportion of leads online. Those that generated 80-100% of their leads from online marketing had the highest profitability, a median of 32.5%. That's twice as profitable as firms generating less than 20% of their leads online. The difference probably relates in part to online marketing being a key part of an effective business development strategy. But the lower costs of online marketing also come into play. One recent study found that online marketing costs 62% less than traditional tactics.

So that makes a pretty compelling argument in favor of online marketing. Chances are your firm has considerable room for improvement. Where to start? Next week I'll summarize the best practices that participants in the Hinge study identified. If you don't want to wait, you can download the aforementioned book for free from the link above. Or you might prefer to check out the summary of the study as specifically broken out for our industry.

Saturday, March 9, 2013

Common Strategic Planning Mistakes

The CEO of a regional engineering firm recently told me, "I've participated in about 25 strategic planning efforts with this firm, and I don't know that I've found any of them really satisfying." He's not alone. A McKinsey survey of 796 executives found that only 45% of them were satisfied with their company's strategic planning process. Moreover, only 23% of them reported that "major strategic decisions" were made through that process.

How effective has your firm's strategic planning been? If you've been less than satisfied with the results, the likelihood is that your firm has made at least one of the following mistakes:

Not really strategic. Much of what passes for strategic planning would be more accurately described as tactical and operational. There's still value in those plans, but they fall short of defining strategy and positioning the firm to achieve strategic objectives. 

So what is strategy? I like McKinsey's definition: "Strategy is an integrated set of actions designed to create a sustainable advantage over competitors." There are several important aspects of this definition that you should consider:
  • Strategy involves a cohesive approach to the business. Lack of operational alignment will undermine strategy.
  • Strategy is dependent on effective execution. It is defined in actions, not intentions.
  • Strategy has a long-term perspective. It seeks to create sustainable success over time.
  • Strategy is about creating competitive advantage. In our business, we have traditionally been satisfied with simply being competitive—winning our share. But future success will increasingly depend on being better than your competitors.
Strategy guru Michael Porter offers a useful analogy to help us distinguish between operational planning and strategic planning. The former, he says, involves defining how to run the same race faster; the latter, choosing to run a different race. 

That doesn't mean you need to change markets or service lines to be strategic. But it does involve a serious rethinking of how you'll conduct your business going forward. Bottom line: How will you create or sustain your competitive advantage?

Lack of innovative thinking. One of the biggest reasons people grow disenchanted with strategic planning is the paucity of fresh ideas that lead to breakthrough strategy. Most plans cover the same general ground year after year. In the past, this may have been sufficient. Prior to the recession, most A/E firms were successful because the business was growing. Now that kind of growth is achievable only by taking market share from competitors, something few firms are equipped to do.

The situation calls for new strategy. But most firms seem to be recycling old ideas about how to develop new business and deliver their services. As noted above, strategic planning calls for a reevaluation of the status quo, recreating (or at least recalibrating) your strategy to respond to the changes in the marketplace and society at large. For ideas on how to promote creative thinking in your planning process, see this previous post.

Too broad and disaggregated. Going back to our definition, strategic planning should define a cohesive course of action to move the company forward. In an attempt to be inclusive, many strategic plans result from simply combining input from various business units and corporate services. Yes, you should avoid leaving key managers feeling neglected by the planning process. But a patchwork of action plans does not constitute strategy.

A better approach is to define your overall company strategy first, then have managers develop their unit plans describing how they will contribute to and align with that strategy. In many firms, the process of aligning business units alone could prove strategic, regardless of what the larger goal is. Diversity can be a strength, but the lack of focused, coherent strategy (and the coordinated effort that comes from it) erodes the prospects of success. 

More action items than the firm can realistically achieve. In every planning cycle, it's easy to identify more things needing attention than your firm can possibly address at once. That's another reason why strategic plans get too broad in scope. Strategy involves clarifying which challenges and opportunities are most important and what actions will yield the greatest payoff. You don't want to stifle ambition and drive. Your plan should be aggressive; it should demand your firm's best efforts. Just be sure that it's achievable.

Focus helps you avoid getting overly ambitious. It's better to go deeper than wider. Why? Because when people are working toward the same goals there is a synergistic effect. More will get accomplished with focused effort than distributing labor across multiple unrelated action items.

Not getting the right people involved in the right way. Strategic planning is a group effort. You want to assemble a team of people who are (1) able to contribute the best ideas and insights to your planning process and (2) best suited to lead implementation of your strategy. However, the most common way to select who's involved in the planning process is to refer to the top of the org chart. Presumably your best thinkers and leaders are found there, but is that really true?

The fact is that many senior managers add little value to strategic planning. They may not be visionary or embrace change or be effective leaders of new initiatives. You might argue that their position in the firm alone dictates that they be involved, which I would agree with. You need the support of your senior managers. But it's worth considering who might be excluded by rank who could really contribute to your strategy development.

As one who facilitates strategic planning meetings, I can testify to the advantages of having a smaller group. But that means leaving some out who might be helpful. There are techniques for dealing with larger groups (e.g., small group breakouts), but perhaps a better way is to approach strategic planning as a process rather than an event. Consider ways to get others involved that doesn't require participation in the main meeting. There are many ways to do this—perhaps a topic for a future post.

Failing to adequately address the details of implementation. Consultant David Maister once observed that the biggest difference he saw between the most successful firms and the rest was not the content of their strategy, but how well they executed it. The greatest shortcoming in strategic planning is obviously found here. That's why I push my clients to be sure they emerge from the process not only with a strategic plan, but an implementation plan.

What does an implementation plan entail? The usual action items with deadlines and responsible individuals assigned. But go further and determine how much time is involved. Do your implementation leaders have that time available? If not, what do they need to offload or who else can help? Remember, strategy execution usually involves change. Therefore, don't ignore the steps involved in making change successful.

I recommend monthly progress updates, with perhaps an associated meeting or conference call to share ideas and encourage follow-through. Beware of "front-end loading" your action items, having most of them occur within six months after the plan is finalized. It's good to get things done promptly, but you need to guard against losing momentum afterwards. If you can accomplish your strategy in six months, it's probably not much of a strategy. Like any plan, you want to be periodically updating it to keep pace with your progress and changing circumstances.

Saturday, March 2, 2013

Do You Really Need an Elevator Speech?

Back in the days when I attended industry trade shows, I always spent some time roaming the exhibit floor checking out our competitors. I would make note of their exhibits and collect their handouts for analysis. Occasionally I would learn something from competitors that I wanted our firm to emulate. More often, I learned what not to do.

For example, I was frequently entertained by competitors' responses to a common question: "So what does your firm do?" Their answers more often than not indicated that not much forethought had gone into them. The large national firms that we usually competed against seemed to struggle most. Their most common answer? Some variation of "we do a little of everything."

I suppose that response was intended to impress. It always had the opposite affect on me, and I suspect, on others. So I worked at perfecting my so-called "elevator speech," a 30-second summary of what distinguished our company. It was unique and to-the-point, and I could deliver it flawlessly, whether manning the trade show booth or mingling at a networking function.

Yet it never quite felt right to me, perhaps because it was more like reciting lines of a script than conversing. Perhaps it was because it was designed to provoke still further inquiry about my firm, shifting the focus from the other party. Eventually I came to believe that the importance of having a pre-rehearsed elevator speech was overhyped.

That conclusion flies in the face of conventional wisdom. Google the term elevator speech and you'll find that the overwhelming sentiment is that having one is essential—both for your firm and yourself. And don't get me wrong, I think being able to respond in coherent and concise fashion to the question "what do you do?" is far better than the run-of-the-mill answers I usually hear.

So my advice is this: Give some thought to how to effectively introduce yourself and your firm with an economy of words, but without coming across like telemarketer. A few tips to keep in mind:

Avoid the hype; state simply what you do. Many sales experts advise starting your pitch with a slogan or hook that sets you apart and creates immediate interest. To say, "We design spaces that bring out the best in the people who occupy them" certainly is more memorable than simply saying, "We're an architecture firm." But what first impression are you really creating? For many, that kind of line comes across as cheesy. Better to stick with the facts without seasoning them with unsubstantiated or arguably trivial claims.

Be specific without trying to be comprehensive. Of course, there's a better answer than merely stating, "We're an architecture firm." You should add a few details to at least distinguish your firm from every other architecture firm out there. For example: "We specialize in educational facilities, anything from vocational schools to universities to military training centers." But what if your firm works in several other markets? This is where many feel they have to choose between taking five minutes to answer or summarizing with something like the aforementioned, "we do a little of everything."

A common mistake in marketing departments across our industry is trying so hard to be inclusive of all the firm does that they give too little attention to what the firm does best. When your window is only 30 seconds or so, you can't afford to be comprehensive without sounding generic—unless your firm is narrowly specialized. So highlight your strengths. If these don't align with what the other party might be looking for, you can add something like: "Plus we have worked with a number of manufacturing companies like yours" (if that's true, of course).

Quickly shift the attention to the other party. For many, the ideal elevator speech has the other person asking further questions, giving you more time to toot your own horn. I don't agree. Many of the questions asked in conversation between strangers have more to do with being courteous or trying to keep the conservation going than actually being interested in the other party. If your elevator speech practically begs an explanation, don't assume that follow-up questions are an expression of real interest.

One thing you can be certain that the other person is interested in is himself or herself. Therefore, the best way to have a conversation that might lead to something more is to encourage the other party to do most of the talking. Quickly answer the introductory question about you or your firm, then shift the focus away from yourself. Ask great questions that show genuine interest, not the usual salesy interrogation. There will be a time for you to do more of the talking, but try to avoid doing that in the initial discussion.

Be memorable for what you don't say. I like this advice from consultant Michael McLaughlin. You're more likely to make a favorable first impression if you demonstrate more interest in the other person than in what you have to say. People who ask insightful questions, who really listen, and who seem genuinely interested in others are in short supply. Be one of them if you really want to stand out. It's much better than even the most clever elevator speech.