[Note: This story was told to me by John Coe, President of The Sales and Marketing Institute (http://www.b2bmarketing.com/) about a client he had when he ran a full-service direct marketing agency in Chicago. He currently provides consulting and training in B2B lead generation and sales productivity improvement to firms throughout the US.]
An interior architectural design firm hired John’s DM agency to help market their company’s office design services to commercial real estate developers and brokers in the Chicago area. John first collected the brochures of competitive firms to see how they were going about attracting new clients. All the brochures looked the same, talking about the education and experience of their architects, showing images of their most impressive projects (marble foyers, etc.) and generally bragging about just what wonderful companies they were.
John decided to take a different approach (smart guy that he is). He asked the question, “Why is one architectural firm chosen for a project over all others?” That is, what are the compelling differentiators among design firms?
Instead of holding a brainstorming session with his client to conjecture and pontificate on what those attributes were, John reasoned that the most credible source of this information would be the customers themselves (you know, the people who actually choose the design firm and sign the deal).
So he held face-to-face meetings with a sample of this group and discussed their use of interior design firms, their experiences, what worked well, what didn’t, etc. using standard market research interviewing techniques.
So what did John find to be the most important characteristic? Skills? Experience? Previous projects?
No, no and no. It was much more fundamental, much more ‘down and dirty’ than that.
Real estate developers and brokers viewed architectural skills to be a commodity—all firms with any depth of experience provided essentially the same high quality work. No meaningful differentiation here.
What these firms did seek out, quoting from the interviewees themselves, was “a company that would not screw up the deals” they were putting together for prospective buyers. Not a very sophisticated or technical need, but it was a compelling business consideration in their selection processes.
There were two ways ‘screwing up’ typically happened:
- The design firm got far too ‘artsy’ and created a concept that went way over the buyer’s budget, causing them to look for another developer (who used a different design firm), or
- In a side conversation, the design firm would tell the prospective buyer, “this building won’t work as well for you as another one I know of that’s nearby”. And that building was NOT in the portfolio of the presenting developer or broker
The people John spoke with were both adamant and uniformly consistent about this costly issue. It was not what design firms did that was most attractively differentiating, it was what they didn’t do.
How did John use what he learned from his research? He mailed a three-paragraph letter, personalized to each of the 600+ targeted recipients that began with this sentence:
“If you want to work with an interior design firm that won’t screw up your deals, then you should call [his client].”
He went on to elaborate about how his client is keenly aware of the threat of these deal-killing actions and that they were savvy and experienced enough to never create such situations.
Before he executed his campaign, John was told by people who had marketed to developers and brokers that they were a ‘hard core’ crowd (described as ‘land sharks’ by those in the know) who didn’t go for being marketed to and would never open any ‘advertising’ that fell on their desks. That was not John’s experience.
Instead of an anticipated low, single-digit response rate from the mailing, John’s client received responses from 22% of the recipients! That is nothing short of miraculous (and awe inspiring). In the subsequent 3 years, this kind of insight helped John’s client to go from 2-5 employees to a professional staff of 25 architects. When you know what’s really important to your current and future customers, it’s amazing what you can do. Growth anyone?
The insight that drove this kind of result (what NOT to do) could only have been uncovered by deliberately engaging with customers and prospects about what’s important to them—that is, ‘listening to the market’.
Regardless of how smart you may be about your customers, often there are key insights that are not picked up in typical customer meetings or sales encounters because they are not the subject or purpose of those conversations. This is, however, the kind of core issue that is often uncovered in market research.
Do you know YOUR market’s FUNDAMENTALS? You should, because there is a lot riding on it.