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How High Growth Firms Become Above Average

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A constant question from average professional services firms is “how do high growth firms do it differently?” It is certainly a question worth asking, as the performance difference is often dramatic.
There are many things that high growth firms do differently and better than the market average of course, not least of which is a difference in attitude and focus.  Simply maintaining a relentless focus on being 1% better in every aspect of the practice and advice delivery than competitors rapidly compounds into multiple points of difference and excellence.  And THAT gets results.
However, there is a clear point of difference which shows through in multiple research sources.  There is one big thing that high growth firms and low (to “no”) growth firms do very differently.

a. High growth firms typically grow their revenues at more than 20% p.a. while spending about 1% of revenue on marketing

b. Low growth firms barely maintain the same performance year on year and usually spend more than double the amount on marketing

So average firms face diminishing margins through increased costs, whereas the high growth firms are accelerating ahead and spending a negligible amount comparatively.
So the question becomes “what are the high growth firms doing in marketing that everyone else isn’t?
The best firms are spending a lot more effort, but not money, on:
  • content creation (emphasising their thought leadership);
  • educational events (showcasing their expertise);
  • professional networking, client events & trade shows (leveraged prospecting methods); and;
  • building a great online presence & SEO (ensuring they get found, and look good when they get found by all their prospects and COI’s)

Low growth firms spend more money on pure public relations activity, sponsorship, advertising, outbound lead generation activities and trying to incentivise referral activity.

One could surmise then that the low growth firms are busy doing what worked 20 years ago, and it is costing an increasing amount to market that way, with diminishing results.

High growth firms have tapped into the fundamental shift in consumer buying behaviour.  There is need to demonstrate expertise in advance of the client engagement, and there is a need to have an effective digital presence that supports your professional positioning.  Above all though, they are delivering value before consumer commitment.

They are de-risking the consumer engagement experience and showcasing themselves instead of product solutions.

That might just be the biggest difference.

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