A business is simply a system of value creation. In expertise and applied knowledge work, driving value requires people, processes, tools, and applied effort. Your business development strategy will determine how much value you can drive, and to whom.
If you Google around enough, you’ll see a lot of good and bad tactical advice on generating more leads and sales for your firm. What’s missing is a unified theory of business development that ties it all together.
In this article, you’ll get precisely zero tactical advice. Instead, I’ll present a framework for thinking about your entire business development program. One that works today, and one that is flexible enough to grow, change, and adapt to your firm as it changes in size and complexity.
So to be clear, this article will tell you how to think about your business development strategy but not give you prescriptive advice on what to do.
Now to the first question.
What is business development?
Let’s start with a quick definition of business development because it means different things to different people.
I’m using business development to mean the sum of all strategies, tactics, and activities used to acquire new clients and expand existing ones.
In other settings, business development describes a sub-category of sales designed to create partnerships as marketing and sales channels. I’m using the term more broadly here, and in the same way as it’s used by agencies and professional services firms.
Where It Goes Wrong
The problem with business development strategies is that they’re too complicated and filled with scattershot, unrelated tactics. My goal here isn’t to make them simple, but rather to simplify.
The complication stems from a lack of clarity and focus. Without clarity, you’ll lose sight of an overarching goal and add rather than subtract from your strategy.
Of course, your goal is to acquire more clients and become more profitable. But that’s the goal of every business and naturally brings up the question of why anyone should buy from you instead of the countless market substitutes available to them. Delaying an answer to this question will lead to heaps and heaps of useless tactics, poor execution, and confusion.
And another point to make: if you are attempting to compete on price, you can stop here. Competing on price is a viable business strategy, but one that I won’t cover. Low pricing must be coupled with compromises on service or quality, and I advocate neither. If your goal is to achieve market leadership and premium pricing while remaining nimble, this article speaks directly to your acquisition strategy.
This leads us to the final problem of mismatching. Your business development strategy must closely match the available strategic options inherent in your position. Tom Miller presented a model for how firms grow, based on the nature and positioning of your firm. The three types of firms he’s identified are:
- Boutique Generalists: these firms maximize opportunity, and rely on word of mouth and referrals, typically within their own closed networks or geography; these firms are not known for solving a specific problem or for working in a specific industry, because their model word of mouth referrals and traditional networking
- Crafty Horizontals: these firms specialize in a problem, but not necessarily an industry, and rely on client results and public demonstrations of expertise to grow; due to their problem but not industry focus, distribution of their insights can be a hard challenge to overcome
- Systematic Verticals: firms that specialize in a particular industry vertical and target their marketing and expertise based on the needs and clients in that industry; this strength is also a weakness because it places a constraint on their serviceable market and subjects them to their chosen industry’s economic forces
If you’d like more background on Tom’s client acquisition model, I urge you to read his excellent book for free here.
The Business Development Strategy Stack
I started this article with the premise that your agency is simply a machine that creates value for your clients. That’s it.
At least, that’s how my nerd brain thinks about everything. If you’re not familiar with systems thinking, here’s your introduction: a system is a series of interconnected parts that produce predictable outcomes. The implications of this way of thinking are paradigm-shifting, but unfortunately, we don’t quite have the language or tools to adequately describe it.
All you need to know is that your business development strategy must be created in recognition of it being a system with constraints and interrelated components. That’s it.
While I advocate for better marketing and selling, these ideas miss the nuance of your strategy. That might nudge you to address symptoms rather than root causes.
With that, here’s an overview of my unified theory of business development strategy:
Each component has a very specific purpose:
- Positioning and POV: what your story and purpose is, and how it’s different from the glut of other options in the market
- Marketing: how and where you’ll tell that story, and how you’ll generate leads
- Sales: for those select few who are interested in working with you, you’ll help them make an informed decision about whether they should engage
- Delivery: to serve your client over the lifecycle of the help they need from you, which may include subsequent, repeat sales
Now I’ll cover each component of your strategy separately.
Positioning and POV
The purpose of positioning and point of view is to provide a clear choice to the market, and to act as a North Star for every business decision you make.
I’ll use marketing firms as a starting place to understand the positioning layer.
Let’s start with the obvious: marketing is a broad topic. Within it, there are tons of specialty areas, and none of them imply expertise in all aspects of marketing, or even in more than one area. An agency may specialize in marketing strategy, but not tactical execution. An agency may favor offline marketing or digital marketing, but not both.
And drilling down into just digital marketing, an SEO firm may have technical chops but lack the ability to create and publish exceptional content that ranks in the first place. And the firm that creates exceptional content might be inept at promoting or ranking it.
It’s a big world, and no matter how deeply you go into any line of service, you’ll see that there are dozens, if not hundreds, of choices available in the market.
Which begs the question every prospective client is asking: “why you?”
Your firm positioning strategy is the backbone to your entire business development plan. I’ll give you two examples.
Jonathan Stark is a solo practitioner. His core positioning strategy and point of view is expertly summarized in just four words: hourly billing is nuts. This positioning strategy permeates every aspect of his business, telling him what to make, how to charge (never hourly!), and what to build next.
Now let’s look at a firm. Gold Front is a category design studio that helps pioneering companies create and own their category. (NOTE: As of this writing, I’m Head of Growth at Gold Front.) The firm’s positioning touches every decision made about marketing, selling, and delivery. Yes, the firm has a variety of services typical of a marketing firm, but that doesn’t help anyone pick Gold Front over other options. The story about category design is the starting point for every strategic question the business answers.
It’s important to note here that your positioning and point of view works best if it stands for something, and therefore excludes lots of someones.
The Marketing Process
The purpose of the marketing process is to express your positioning and point a view in a way that generates highly qualified leads.
Traffic is required so people can be exposed to your positioning. The right amount of traffic, and traffic from the right people, is the stuff of whole book volumes. But you need a steady stream of people – that is, enough people – to be exposed to your company and your core message to give your marketing a chance to work.
Your message needs to stop people in their tracks when they hear it. That’s a tall order. The more you can gain and keep someone’s attention, the more chance you have of landing a new client. This leads to related questions about which channels you use to deliver your message.
Channels are for distribution and the right ones drive success. Choosing your channels wisely is a core question of your overall business development and marketing strategy. If you’re attempting to solidify a thought leadership position, then you need to write, speak, and publish regularly (that’s what I’m doing). On the other hand, you may attempt event marketing as a way to reach a small, tight-knit community and position yourself and your agency at the center of it.
The Sales Process
The goal of your firm’s sales process is to help your prospects make an informed decision about whether to work with you. There’s too much emphasis on conversion and close rates, when in reality they’re both lagging indicators of the quality of your marketing and overarching positioning decisions.
Of course, there’s plenty you can do to improve your sales program – I recommend you start with my SDS Method as a primer if you don’t have any sales process to speak of.
Your sales process starts with finding the right fit clients. It sounds incredibly obvious, but your ideal client isn’t “a business owner” or “B2B companies.” This, again, harkens back to your positioning and point of view because inherent in your positioning is a choice about who you should work with. Said a different way, you must filter out all but the best prospects. Some of that has to do with the qualification questions you ask, some of it has to do with call planning, and some of it has to with good old fashioned research before you speak to someone.
Your offer is the heart of your business. It should reflect everything: what your client needs your help with, your positioning, your marketing, and how you’ll deliver a solution that you’re exceptional at and will help your clients. Which is why the path to improve your offer may be to improve your product, your marketing, or your overarching positioning. Your offer exists to reinforce it all, and prompt your prospects to make an informed decision. And heads up: productizing your service can vastly improve the quality of your offer.
Your sales process exists to support your prospects’ ability to make good decisions. Which is to say, the right prospects should sign contracts with you, and the wrong ones should leave your sales process. Without the process in place, you’ll experience unnecessarily long and unpredictable cycles. Your process should include both value-based selling and value-based pricing.
The Delivery Process
If you market well, people will be interested in hiring your firm. If you sell well, people will actually hire your firm. Now it’s time to deliver on your promises.
Delivery is a process that can do so much more than just hand over the goods. You’ve heard people say “the best marketing is a good product,” and to some degree that’s true. What it misses is the intention you can build into your service delivery: you can increase the value your clients get; and the opportunities your delivery itself can provide for your business development program.
The product you deliver is contagious. Or at least it should be. It’s contagious internally to a client’s company because they’ll look good and tell other people about how valuable your agency has been for them. And it’s contagious outside your client’s company because they’ll tell their friends and colleagues about how great of a job you’re doing. The mechanism and amount of value you deliver can be built right into the product, and so can the “shareability” of it. “Do great work” discounts the planning you can put into your product to elevate the value you deliver, and therefore increase the chances of word-of-mouth referrals.
The quality, speed, and ease of using your service can inspire referrals, too. This is so underrated. For some reason, most agencies are so focused on deliverables that they don’t think enough about the customer experience. And yet if you’ve ever hired a plumber, you probably rate them separately on metrics like speed and ease of working with them in addition to how well they completed the job. Your service – not just your deliverables – is a business development tool.
Your client lifecycle tells the story of what someone needs to buy from you. This is tied directly to your positioning and POV. For example, you may have a point of view on how companies in your market mature overall, or how they mature in the particular aspect you solve. I have one here, that is both a point of view and a lifecycle:
- You create a point of view and position that clearly differentiates your firm
- You begin to tell that story to increase traffic through the right channels
- You have a sales process designed to target the right people with the right offer
- You deliver a product and service that’s contagious, elevating your client through the entire lifecycle of their improvement, selling them more of what they need along the way
Of course, if I were more enterprising (and had more time), I could sell products targeted at each of those lifecycle stages:
- How to position your firm and create a point of view
- How to demonstrate your point of view through marketing and networking
- How to build a sales platform that increases your prices, efficiency, and scale
- Aligning product, service, and lifecycle delivery to organically feed your pipeline
I’m workin’ on it.
But you get the idea: organizing your delivery of product and service into a larger story will help you feed your business development program while – and this is important – delivering compounded value to your clients.
Moving Beyond the Funnel Metaphor
I’ve avoided the funnel metaphor because it implies chronology. First this happens, then that happens, then the other thing, and out comes a new client.
The idea is useful, but the reality of your business development process is much more convoluted. Most people will go to your website before reaching out, but not always. Most people find you through a channel you’re intentionally optimizing, but not always. Most people will go through your standard sales process start to finish, but not always.
Your business development program is ultimately a collection of small bets you place to grow your profitability. My friend Philip Morgan has written about small business bets and the upside of them – you get to adjust your bet as you receive feedback. So you can think of it more like a stock portfolio that you can adjust, derisk, and reallocate over time.
The sum of all of these little bets in each of the areas laid out in this article is your business development program. Unfortunately, your average lead will rarely cooperate with your funnel precisely as it’s laid out.
Instead, we know the components that drive business development:
- The right people are aware of your firm…
- …and understand they have a problem you can solve…
- …so they learn if they should work with you…
- …and get increasing value over time if they do.
That’s the process. What I’ve attempted here is to show you how it all works together, and begin building a strategy that works for you.
Where to Begin With Your New Business Strategy
Your new business strategy might feel like a beast, but it should be relatively simple. My business development plan is less than two pages, and moves sequentially through these five steps:
- The goals you want to accomplish
- The strategy you’ll use to achieve your goals
- How you’ll measure those goals
- The tactics you’ll use to drive those metrics
- Keep a monthly or weekly scorecard to see how close you get
Whatever you do, get started and be intentional.
And if you’d like help building a business development strategy at your firm, fill out my contact form to start a conversation.