Survey Says: Strong Intellectual Capital Is The Key to Effective Professional Services Marketing
By Bob Buday, Bernie Thiel, and Susan Buddenbaum
U.S. professional services firms said having strong intellectual capital (IC) was the most important ingredient of effective marketing—more important than having a compelling brand, big marketing budget, a sound marketing strategy or capable sales force, according to a recent survey conducted by The Bloom Group (Exhibit 1). And the firms claiming to have the best IC were far more likely than those reporting inferior IC to generate substantial market awareness and leads for their services.
The findings call into question the spending of many professional services firms on traditional marketing channels such as advertising, trade show exhibitions and telemarketing.
The survey—the basis for a Bloom Group research report, "Attaining Thought Leadership"—also found that managers and senior executives at 179 professional services firms on average do not view the content of their marketing programs as being compelling—achieving so-called "thought leadership" quality. As a whole, survey participants rated the intellectual capital they marketed through articles, books, presentations and other activities just better than mediocre—a 3.61 on a scale of 1=not at all successful in having strong IC to 5=highly successful. More specifically, respondents gave their IC their lowest marks for rigor, depth, proof (having examples and other data that supported their key assertions), clarity and novelty.
The survey featured a wide range of types and sizes of professional services firms: consulting, IT services, law, accounting, training and development, research and others. Some 25 percent had annual revenue of more than $1 billion, 35 percent had less than $25 million, 18 percent had $25 million to $100 million, and 22 percent had between $101 million and $1 billion
Other major study findings include the following:
- Content counts: Professional services firms with far superior IC as the content for their marketing programs were much more likely to generate substantial market awareness and business leads than were firms with inferior IC. Some 81 percent of the firms with far superior IC—compared with only 10 percent of firms with inferior or far inferior IC—said their marketing programs were very effective or had more than average effectiveness in creating substantial market awareness and leads.
- The smaller the firm, the better the ideas: A much higher percentage of the smallest firms rated their IC to be far superior than did the largest firms. Some 47 percent of the firms with less than $25 million in revenue said their IC was far superior, while only 25 percent of organizations with more than $1 billion in revenue said the same thing. These findings suggest that attaining thought leadership isn’t dependent on resources, and that superior content is the great equalizer between small and large firms in the competition for clients.
- Attaining thought leadership requires focusing more resources on developing professionals' ideas than on marketing them. The firms that said they had the best intellectual capital estimated investing about 57 percent of their IC development and marketing resources in developing IC and about 43 percent in marketing it. The firms with the worst IC did the opposite: they spent only about 41% of their resources on developing ideas and about 59 percent on marketing them. The firms with the best IC were much more likely to use a research consortium and internal research groups as a primary IC development technique.
- Marketing a firm's IC requires educational, not promotional, methods. Survey respondents as a whole rated giving presentations at educational conferences—their own and those hosted by third parties—and articles authored by their experts as the most effective ways to market their IC (Exhibit 13). They said the least effective ways to market their IC were advertising (print, broadcast, and online), sales brochures and conference exhibition booths.
- Superior intellectual capital is increasingly critical. More than three-quarters (77 percent) of the firms polled said having strong intellectual capital to market had grown in importance over the past five years, for three factors more than any others: increasing competition and the need for differentiation; past success with marketing the firm's IC; and client demands for demonstrating greater expertise before they choose a professional services firm.
The study focused on thought leadership in professional services—its value in generating market awareness and revenue, how the ideas of firm experts are developed and captured for marketing purposes, and how those ideas are marketed. From July to early September, The Bloom Group conducted an online survey that generated 179 responses from marketing executives, CEOs, managing directors, heads of practice and service lines, and other professionals. In all, about half the respondents were marketing managers and one-third were non-marketing executives.
Because professional services firms are in the business of providing expertise, it shouldn’t be surprising that they feel the key to generating marketplace interest in their services is capturing and marketing strong intellectual capital. Our survey clearly shows that the content of firms’ articles, websites, newsletters and other publications, public speeches, books and other marketing activities counts more than any other factor. We are not saying that brand and image is unimportant, or that advertising, brochures and other staples of marketing should not be used in professional services. To the contrary, we believe these vehicles can be instrumental to creating a brand image. But the survey indicates that marketing the ideas of a professional services firm through educational, rather than promotional, marketing channels is much more important.