First the why…now the how.
February 19, 2014 | The Whetstone Group

In our last post, we talked about why industry specialization is a good idea, especially for business development purposes.  So now let’s talk about how to drive growth with industry specialization.

First, it’s important to recognize that you can’t just decide you’re a specialist and start promoting it overnight; there is a process to building a niche. In our work with professional service firms, we’ve identified four phases of this process:

  1. Exploration
  2. Knowledge and content building
  3. Practice building
  4. Recognition as specialists

Below is a description of each of the four phases, including tips for how to make progress.  It’s important to err on the side of taking action; don’t feel as if you have to reach perfection in each phase before moving on.  You likely have competitors who are building industry practices and promoting their firms as specialists. Don’t lose market position by spending too much time planning and preparing.

Exploration

This is the phase when you’ll decide what industry(s) make most sense. You’ll need to determine:

  • Whether there is enough of a market available
  • How entrenched your competitors are in the industry
  • Whether you have a compelling story to tell and the right people to work the niche

Some additional things to think about to decide if building the niche is feasible:

  • Do you have a strong champion for the niche?
  • Are there several professionals in the firm who are willing to commit to working the majority of their time in the industry, get the technical/industry training, and do the business development work?
  • Does the firm have at least a few clients in the industry and one or two high-visibility clients who will serve as references?
  • Do you offer the range of services necessary to address the needs of companies in the industry?
  • Are you willing to budget the time and dollars necessary for training, certifications, and business development?

Knowledge and Content Building

The first step in this phase is to determine what industry associations and publications are available. Professionals can learn the industry language, trends, hot topics and more just by attending association meetings and reading publications. Some additional ideas for gaining industry knowledge:

  • Job shadow clients
  • Industry Web sites
  • Social media groups and company pages

As your professionals learn more about hot topics, issues and trends, they can start to develop relevant industry-targeted content to use in the practice building phase. Speaker presentations, journal articles, and white papers are all examples of content you’ll want to have on-hand for business development purposes. And once you have an inventory of content, there will be opportunities to re-purpose these items in multiple channels.

Practice Building

Equipped with a champion and a team of professionals who have identified a target industry and invested time to acquire knowledge and build content, you’re now ready to promote your niche practice. As discussed previously, this promotion is made easier by the focus you have within the industry. Here are the steps:

Define the target market

Define the geography and size of companies within the industry that make the most sense for you to target. Decide whether there are sub-industry groups you can target to further narrow your focus.

Focused activities

Once the target market is defined, the next step is to put together a schedule of marketing activities to build a position for your firm in that market. Examples of focused activities include:

  • Industry association participation
  • Industry-specific blog
  • Bio/online profile updates
  • Networking with key industry players
  • Referral source networking
  • Direct mail
  • Content marketing with relevant industry topics
  • Cross-selling to existing clients in the industryTransitioning from Marketing to Sales:

Once your niche team has invested the appropriate amount of time in building their market position, it’s time to start getting a return on that investment; that will happen when your team members transition from pure marketing activity to more proactive sales behaviors. With the ultimate sales goal of being face-to-face with interested prospects, examples of transition activities include doing telephone follow-up after direct mail to set sales appointments, identifying key prospects from industry associations and extending personal invitations for one-on-one meetings and lunches, and collecting contact information from speaking engagements to follow up with attendees.

Recognition as Specialists

The Holy Grail — in this final phase, when the target market recognizes your firm as specialists in their industry, business development and growth become infinitely easier (and potentially less expensive). Through personal experience and word of mouth, companies in the industry know to come to you when they need help and/or are ready to switch providers. The need for your firm to invest in extensive branding and positioning activity lessens (although it never totally goes away!) and your professionals can spend more time in front of interested industry prospects and clients, selling and delivering services to increase revenue.

New Year…New Approach to Business Development?
February 5, 2014 | The Whetstone Group

We’re a month into the new year — if you aren’t already, it’s probably time to start thinking about how to continue growing your business in an increasingly competitive environment. It’s not enough to work the same contacts you always have and continue to tell the same story. So how can you identify new contacts and update your story? One avenue is to compete as specialists in a niche market.  While some firms develop niche practices around service categories, we find industry-focused niches are most effective for business development purposes. Here’s why:

1. More targeted marketing opportunities

Prospects don’t gather in groups based on what service they need; there isn’t an association for companies who need audits! However, there are plenty of industry associations: associations who have meetings (networking opportunities), sponsor conferences (exhibiting and speaking opportunities), publish trade journals, e-newsletters and blogs (publishing and advertising opportunities) and hold special events (sponsorship opportunities).

2. Increased cross-selling opportunities

When firms organize business development efforts along functional practice areas, more often than not their professionals discuss one service area — their particular expertise — with a prospective client. But when they organize business development around industry, firms typically start to see a transition to cross-functional team selling. Those in the firm who provide a variety of services to a particular industry can talk to the prospect together about all the ways the firm can help because they know the industry issues and best practices.

3. Elimination of silos

Often traditional service can become problematic; cross-functional industry-focused teams typically help to break down those silos. Proposal teams look at the whole picture for a prospective client and develop a more effective proposal; sales teams present the wide range of expertise the firm can bring and make a better impression; cross-functional client service teams look at the client’s entire organization and ensure the firm is addressing all client needs.

4. Ability to differentiate

What gives a firm the competitive edge to win a proposal? Is it the process they use to deliver a service? Is it really that much better — or, for that matter, different — than a competitor’s? Prospects expect firms to be service experts — that’s a given.  What can really differentiate a firm, though, is when they can talk about a broad base of experience in a prospect’s specific industry. Recognizing red flags, knowing best practices, being aware of requirements, offering expertise outside of your core service area — these are all advantages that come from specializing a practice in an industry. These advantages translate to big benefits for clients and these benefits will provide differentiating marketing messages in proposals, on web sites and in other marketing materials.

5. Attention-getting marketing messages

Obviously, most of us are more comfortable speaking our native tongues. In the business world, that means speaking the language of the industry in which we operate. Talk to construction owners about bonding and relationships with surety agents; talk to manufacturers about the inventory issues and materials costs; talk to non-profits about increasing board-of-director confidence. Speaking the right language is what will get prospect’s attention and keep them engaged in content and marketing materials.

Come visit us here soon, as we’ll be following up by talking about the four phases of selecting and building a niche and offering tips for how to work the phases successfully.