Market Research is the Foundation for Winning
Posted by Website Director on Sep. 10, 2022 / Blog / Subscribe 0
Picture it: You’re sitting in your office, answering emails, working on a budget for 2023, and eyeing the stack of proposals you’re somewhere in the middle of submitting; when that one seller-doer walks in with another RFP from left field. “This is the one! This project matches my skills perfectly and I met the client at a Zoom conference back in 2020. We gotta go after it!” Your eyes roll. We’ve all been there. We usually chalk it up to that person that just “doesn’t get it” or the person that wants to get everything. But, maybe there is more to the story… what if they just don’t have faith in the targeted client list in the business development plan that you’re all supposed to be focused on? Or worse, there is no plan…
The Markendium: SMPS Body of Knowledge defines market research as “the data gathered, recorded, and analyzed related to marketing a firm’s services. The data can be used to identify and define marketing opportunities; generate, refine, and evaluate marketing actions; monitor marketing performance; and forecast trends.” That data is the foundation of everything we do in marketing and business development. When it’s weak, the whole system and process for wining work is weak.
While there are countless resources available in A/E/C to better understand our markets, but we tend to “go with our gut” or trust “that last year will be a good indication of next year.” Too often, that stack of maybe-proposals (maybe winners, maybe not) is prioritized over the research that could guide us in where we even begin to focus our efforts to win work. One proposal can typically cost a firm between $10,000 and $20,000 on the low end. Double those numbers if it goes to in-person interview. Saying “no go” to one or two maybe proposals, would free up a volume of cash better spent on targeted market research.
The time to do market research is another barrier to getting it done. Typically, marketing and business development professionals are hyper-focused on winning work. Who has the time? (Full disclosure: my company, GO Strategies, does not offer this service.) There are many consultants out there that specialize in market research in addition to the big companies that provide it. Ask your network, often local or regional experts are a great value. Bigger market research firms also can provide excellent market forecasts in online or on-demand webinar formats.
Whether you’re hiring a consultant or tackling research in-house, it’s best to start by understanding the big picture of your company – where you’re going from a geographic and financial perspective, what you do really well and what you’re not so great at, what the ideal future looks like, and how much investment you’ll make to get there – are just a few things to consider. You want to look internally and externally. What’s the sense of wanting to explore a new market (externally), if you have no one available in the firm (internally) to get you there? When you’ve looked deep into both, you can get a better sense of what you need the research to tell you. Good market research is targeted. It helps your firm see the possibilities and challenges. This high-level market research helps frame the future for your company.
There is still another layer deeper, a more tactical level, for market research that is needed before you can set the course for business development and make wiser go-no-go calls. This is the market research that goes deep into your market sectors or business lines or profit centers. Here you want to look internally and externally as well. Starting internally, look at where you’re making a profit and where you are not. This is the space where marketing and finance can supremely benefit one another. While high-dollar generating clients can keep a lot of folks billable, they aren’t always the most profitable. Working with your finance team, slice-and-dice the numbers – which clients pay on time/which do not? which clients are easy to negotiate with/which are not? which clients have been in your stable for a long-time/which are new? – are just a few things to look at. In addition to the money, talk to the doers! Those people that function more in technical roles, less in outward facing roles in the firm. Ask about the work they’re doing – are they happy doing it? are they proud of the work? do they enjoy the client interactions that they have? – are all ways to get at a list of the right clients. In this fierce talent war that we are struggling though, these questions can carry tremendous value. Last, internally, ask your leadership and seller-doers – are the clients’ micro-managers? are they flexible with deliverables when they need to be? are they easy to get to know and enjoyable to work with? – are some questions to help further prioritize the best of your clients. Some companies take this information and create client tiers A, B, and C; dividing clients into the best, the good, and the sustaining.
Externally, there are different ways to go about researching your clients. In the public sector, they often publish budgets or Capital Improvement Plans (CIPs) that tell you what work they have coming up. These are great starting places, but they cannot replace conversations directly with the client. CIPs and budgets often do not discriminate between what’s being done by agency staff and what work will come out to consultants. Having an annual conversation with your clients about the future, often in this late Summer/early Fall timeframe, can help you more clearly understand what’s coming. Talk to your clients! This is called “qualifying the pipeline.” It’s critical. Pipelines and internal forecasts are only as valid as the information going into them. The more credible we can be with this data, the more trust we will have in the plan built from it. Ultimately, the more comfortable the seller-doers will be with sticking to the plan.
If you’re getting a lot of out-of-left-field or one-off RFPs flooding your office, it’s time to look back to the beginning. Are we doing the right research to frame what we want and where we want to go? Are we focused on the clients that we want and that have the work potential that we need to be a healthy business? If you struggle to answer these two questions, it’s time to have a conversation about starting stronger with a foundation of market research you can believe in and rely on.
About Frank Lippert, FSMPS, CPSM
Frank Lippert, FSMPS, CPSM is the founder/partner of GO Strategies, LLC. He is a past SMPS Society President and a past President of the SMPS Foundation. Currently, he is the co-host of the PSM Show podcast. www.psm.show
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