{"id":8177,"date":"2022-01-31T17:32:05","date_gmt":"2022-01-31T17:32:05","guid":{"rendered":"https:\/\/mailinvest.blog\/index.php\/2022\/01\/31\/differentiated-marketing-for-professional-services\/"},"modified":"2022-01-31T17:32:05","modified_gmt":"2022-01-31T17:32:05","slug":"differentiated-marketing-for-professional-services","status":"publish","type":"post","link":"https:\/\/mailinvest.blog\/index.php\/2022\/01\/31\/differentiated-marketing-for-professional-services\/","title":{"rendered":"Differentiated Marketing for Professional Services"},"content":{"rendered":"

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What is the best way to grow your professional services firm? Should you specialize and zero in on a specific market niche? Or would that narrow focus be too risky? Perhaps you should broaden your target audiences. Or would you risk becoming nothing special to anyone?<\/span><\/p>\n

For many professional services firms the answer is neither. They choose a strategy that combines elements of both approaches. This strategy is called differentiated marketing.<\/span><\/p>\n

Differentiated Marketing Defined<\/b><\/h2>\n

In <\/span>Differentiated Marketing<\/b> a firm pursues multiple target markets using different marketing strategies for each. This approach can be contrasted against two alternative strategies: 1) <\/span>undifferentiated marketing <\/b>(or mass marketing)<\/span>, <\/b>in which a single marketing strategy is used to address multiple target markets; and 2) <\/span>niche marketing <\/b>(also called focused or concentrated marketing), in which all marketing resources are focused on a single segment of a larger market.<\/span><\/p>\n

To illustrate these different marketing approaches imagine that an accounting firm has three service lines, and they market each service using a different marketing approach. The first service is tax filings, which they market with an undifferentiated approach. They pursue all market segments using the same set of techniques, including face-to-face networking and encouraging referrals from existing clients. They bill hourly for this service.<\/span><\/p>\n

Their second service line, outsourced bookkeeping, targets a single market niche \u2014 small family-owned restaurants. To reach this segment, the firm attends restaurant trade shows, partners with trade associations, and invests in online advertising. The firm sells this service as packages carefully priced for this niche market.<\/span><\/p>\n

Their third service line is operational business consulting. Here they use a differentiated marketing strategy. For one target segment, family-owned restaurants, they use the same strategy as the bookkeeping service, and they sell their consulting services as part of a fixed-price monthly package. For a second segment, small manufacturers, they use a different strategy: they focus on cultivating referrals from bankers, and they price their services on an hourly basis. Different target markets, different marketing approaches \u2014 each tailored to the needs and preferences of that target market. That is the essence of a differentiated marketing strategy.<\/span><\/p>\n

Differentiated Marketing in Professional Services<\/b><\/h2>\n

The professional services industries are particularly well suited to a differentiated marketing approach. Many services can be applied to multiple target markets. This means there are a lot of opportunities to focus on an attractive segment.<\/span><\/p>\n

Most services can also be tailored to fit the unique needs of a particular segment. So you can adjust your offerings without having to retool a factory or write off inventory of manufactured goods.<\/span><\/p>\n

Perhaps most importantly, <\/span>buyers of professional services<\/span><\/a> usually prefer firms that are familiar with their industry and the specific challenges they face. This behavior gives niche focused strategies a distinct advantage. And a differentiated marketing strategy allows you to address multiple segments with carefully tailored services and marketing plans.<\/span><\/p>\n

It is true that implementing multiple marketing strategies can be more complex and costly. And it requires discipline to plan and execute a differentiated strategy. But the upside can be tremendous.<\/span><\/p>\n

When choosing between providers, professional services buyers are most likely to choose the firm that has the strongest track record of solving problems like theirs.\u00a0 Naturally, the advantage goes to the niche-focused specialist.<\/span><\/p>\n

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Figure 1. <\/strong>The top 5 buyer selection criteria that tip the scale in favor of one firm over another.<\/p>\n<\/div>\n

Differentiated Marketing Examples<\/b><\/h2>\n

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A Consulting Differentiated Marketing Strategy: The AIM Institute<\/b><\/h4>\n

The AIM Institute (AIM) specializes in advising Fortune 2000 companies on product development and launch strategies, and they use differentiated marketing to engage two different audiences.<\/span><\/p>\n

To address its decision-maker audience (strategic leaders\/influencers), AIM has produced targeted educational content, including an ebook entitled, \u201cLeader\u2019s Guide to B2B Organic Growth\u201d and an associated video series. AIM also publishes a special executive-level blog that shares \u201cstories from the trenches.\u201d It reads like a CEO sharing battle stories and insights to another CEO running a large company. All the marketing tools and techniques used with this audience focused on how executives like to learn. Messaging covers product launch strategies\u2014and how these strategies contribute to growth.<\/span><\/p>\n

For its practitioner audience (tactical implementers), AIM has developed a series of specialized workshops that are more practical in nature. These workshops focus more on product blueprinting and de-risking rather than on B2B organic growth.\u00a0<\/span><\/p>\n

An AEC Differentiated Marketing Strategy: Woodard and Curran<\/b><\/h4>\n

Woodard and Curran is an ENR Top 100 engineering firm offering a diverse range of services and industries ranging from nuclear energy to manufacturing automation to city-wide urban renewal projects. It realized that it could not keep using a single marketing strategy to engage itsdisparate clietele. But the firm did not want to move forward without some hard facts to guide their marketing.<\/span><\/p>\n

So it took a step back and conducted brand perception research across several industries to better understand buying behavior and audience issues. It also conducted demand research around specific services such as outsourced environmental health and safety services for private Fortune 100 firms to gauge prospect interest.<\/span><\/p>\n

This strategy enabled Woodard and Curran to build a messaging architecture that addressed specific objections, anticipated responses, and offered proof points\u2013all organized by target audience, roles, and services. The engineering firm then rolled out vertical-specific marketing plans, channels, and content.<\/span><\/p>\n

For instance, those Fortune 100 firms received a personalized, multi-channel outreach strategy \u2014 including traditional mailings and small in-person events. Municipal audiences, on the other hand, were targeted with LinkedIn content distribution promotions that allowed Woodard and Curran to stay in front of their audience even during RFP blackout periods.<\/span><\/p>\n

When to Use a Differentiated Marketing Strategy<\/b><\/h2>\n

When does it make sense to seriously consider using a differentiated marketing strategy? While there are no hard and fast rules, here are some situations when it might be an attractive option:<\/span><\/p>\n

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  1. You have outgrown the niche you are targeting<\/b>. The niche is too small to sustain the growth you desire. A differentiated strategy allows you to add additional niches without losing the advantages a niche play enjoys.<\/span><\/li>\n
  2. You are losing your competitive advantage in an undifferentiated market<\/b>. The services you are offering to your largely non targeted market are becoming more commoditized. It\u2019s harder to win new clients.<\/span><\/li>\n
  3. Your margins are shrinking<\/b>. Differentiated services tend to have higher margins and are easier to defend against undifferentiated competitors.<\/span><\/li>\n
  4. You want to simplify your service offerings.<\/b> Differentiated services are more targeted so they tend to have less client-to-client variation. This makes them less costly to deliver.<\/span><\/li>\n
  5. You want to maximize the overall value of your firm. <\/b>Well targeted niche players typically offer the greatest strategic value to a potential buyer. A differentiated strategy allows you to accumulate these valuable niches and maximize the value of each by tailoring your marketing strategy to wants and needs of individual segments.<\/span><\/li>\n<\/ol>\n

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    How to Develop a Differentiated Marketing Strategy<\/b><\/h2>\n

    A differentiated marketing strategy requires that you develop a separate marketing plan for each segment you are targeting. We recommend using a <\/span>strategic marketing planning process<\/span><\/a> similar to the one outlined in this post.<\/span><\/p>\n

    Here are the key steps in the process.<\/span><\/p>\n

    1. Understand the business situation your firm is facing.<\/b><\/h4>\n

    The purpose of marketing is to enable a firm to achieve its business goals. If you do not start with a clear understanding of those goals and any constraints that limit your ability to achieve them, you will be unlikely to succeed. What is the business reason behind your selection of a differentiated marketing strategy? What will success look like? How ill you decide which segments to target?<\/span><\/p>\n

    Different types of research<\/span><\/a>\u00a0apply to different stages of the planning process. For example,\u00a0<\/span>opportunity research\u00a0<\/b>compares the viability of different markets or target audiences. This type of research helps you decide which segments to target.\u00a0<\/span>Client or persona research\u00a0<\/b>helps you better understand your target clients and how they select a firm. That is our next step.<\/span><\/p>\n

    2. Research your target client segments so you understand their buying behavior, motivations and priorities.<\/b><\/h4>\n

    It\u2019s rare to meet practicing professionals who do not believe that they fully understand their clients, their needs and their priorities. Sadly, they are almost always wrong about some key element of their clients\u2019 thinking and decision-making. They misconstrue clients\u2019 real priorities and they rarely understand how clients choose new providers. Research can set the record straight on all these counts. And it can help you evaluate and price\u00a0 your service offerings..<\/span><\/p>\n

    When you are doing research, focus on your best, most desirable clients within each segment. Which ones do you want more of? Research will equip you to find more clients like them. It will also help you learn how your clients search for new providers and where they get their information. These insights will help you in subsequent steps.<\/span><\/p>\n

    3. Position your firm in the marketplace.<\/b><\/h4>\n

    Successful positioning rejects conformity. At its best, positioning elevates a brand above the fray so that people can\u2019t help but take notice. The human brain instinctively looks for things that are different and unexpected. So a\u00a0brand that stands in stark contrast to its competition\u00a0will attract people\u2019s attention and have a distinct advantage in the marketplace. Keep in mind that this positioning must work for all of the segments you are targeting.<\/span><\/p>\n

    Positioning starts with identifying the factors that set you apart. These factors are called your\u00a0<\/span>differentiators,\u00a0<\/b>and they must pass three tests. Each must be:<\/span><\/p>\n