Know Your Clients

Buyer priorities are changing—and not just because of the plunging economy. A decade ago, client priorities for selecting IT services providers hinged almost exclusively on qualifications and experience. Customers wanted to know: Is there a methodology? Assets? Tools? A pre-engineered solution? Reference accounts?

When the competitive field based on qualifications leveled somewhat, attention turned to relationships. Can everyone work well together? Do service provider and client cultures match?

Over time, however, even these soft skills also became table stakes. Indeed, in the 10 years that we have been tracking IT professional services brands, the bar for providers has risen consistently.

So, how high is the bar today? So high that providers can afford few mistakes. They must deliver on the promises they make and they must demonstrate a clearer understanding of a client’s business. It goes beyond knowing an industry segment and instead requires an appreciation of a client’s business issues, challenges, and opportunities. Buyers are receptive to trusted partner relationships, so they are likely to commit to a reciprocal investment with providers to make the union work.

Marketing has an important role to play in building these trusted partner relationships. Marketing is best equipped to do the deeper research necessary to reveal and understand client issues.

• Differentiation is an endless challenge. In tough economic times characterized by shrinking customer budgets and longer sales cycles, seeking differentiation makes intuitive sense. Professional services firms differentiate by being the best at something and having proof. It is harder for services firms because of the intangibility of what they provide.
• Market positions morph slowly. Often, clients associate service providers with what they have purchased from them in the past—services and product alike. Therefore, transformation takes time and requires persistence and consistency. Migrating market positions is a good thing, but services providers need to do it with full knowledge of their starting point. They need to map a journey that will take time (even years), monitor progress, and make sure they have permission from the market to move into new territory, with proof points along the way.
• Service provider preference is less tied to awareness and more tied to impact. A noticeable change has occurred in the correlation of awareness and preference. Once, they were tightly linked; today they are not. Buyers are more sophisticated now and have access to more information than ever. Therefore, the companies with the highest awareness/mindshare are not necessarily the most preferred.
  Further, in this market there are clear leaders and followers. The leaders stay the same year after year. The followers shift, reflecting changing strategies, intensity of their marketing programs (many do not sustain marketing investment), and buyer needs/market trends. Buyer needs are certainly driven by trends such as enterprise infrastructure, security, business intelligence, and so on. It behooves service providers to stay attuned to buyer wants and needs and to plan their business and marketing strategies to best maximize their brand positioning.