Professional Services Marketing; A Strategy For Providing Client Satisfaction

An Overview

Most professional services are highly personal in the nature of the service provided, be it legal, accounting, medical, etc. The consumer of professional services typically will refer to the provider of the service as 'my lawyer,' 'my accountant,' or 'my doctor,' reflecting the highly personal nature of the work. Indeed, the very need for complete confidentiality and confidence denotes the extreme personal nature of most professional services.

To complicate matters, much of the process in professional services is shrouded in mystery for the typical consumer. There are very foreign terms. 'Legalese' is derided in popular press and media as a sort of arcane foreign language meant to keep the commoner from understanding basic concepts of law. The average consumer gets frustrated by the complication of rather simple matters that undergo legal processes. Arcane accounting processes are difficult and misunderstood by the general public. How many times have you had to wait in a doctor's office seemingly forever, only to have the actual examination last only five minutes?

The purpose of this article is to explore services marketing concepts in current terms and apply them in a novel approach to the rendition of professional services. While much of this article makes use of the legal industry as an example, the application of the concepts flows equally with little modification to other professions.

Professionals are simply not taught how to market in the schooling. There is no training in the area of services marketing, and worse yet, no course work offered that even remotely prepares the professional for the most basic aspect of marketing, client interaction. Ask any recent law school graduate whether marketing has anything to do with lawyering, and you'll likely be met with a blank stare. Indeed, I sought continuing education credits from the State Bar of California for course work completed in marketing towards an MBA and was denied recognition of the work for Continuing Education credit, even on appeal. The reason: These lawyers simply didn't see any relationship of marketing to the practice of law, for the client or the attorney! This is simply an example that the role of marketing in the legal services industry remains a mystery to even the most seasoned of professionals. Yet who could deny the client dissatisfaction that builds from simple failure to return telephone calls in a timely manner (or at all).

If we are to go back to the classic literature in the field of services marketing, we see a common theme: The role of marketing in the services industries is to create customer value. For example, how does one create value to a customer in the legal services field? Most of the work of an attorney seems to be spent either destroying someone or their property, or preventing an abuse of some intangible right or asset. Evert Gummeson suggests that the search begins with market research. 'Value is simply quality, however the customer defines it, offered at the right price.' The goal is to find out how the consumer defines quality and what price the consumer is willing to pay for it.

A key issue is whether the customer notices differences in quality between competing suppliers. If the consumer does not notice any difference, then the consumer either does not care about the level of quality or is not educated as to the available options.

I would suggest that without constant client education and attention to client issues (i.e., listening to the client), there will be a lack of communication to a detrimental effect-disharmonious relations between the professional and the client, and probably a soured disposition toward the entire profession.

Indeed, communication is such a large part of professional services that, at least in the legal field, it can be said that communication is the lowest common denominator of the profession; it is, in the most basic sense, what the lawyer is hired to do. Failure to communicate is a failure to execute the most basic function of the job, which is in itself a failure in quality.

Studies reflect that it's four times more expensive to obtain new business than to retain existing relationships. Furthermore, the loss of existing business destroys the compounding effect of existing client relations, i.e., personal referrals. Because professional services are by nature personal, this failure can destroy a professional business (and notice the use of the word 'business'-'profession' is the practice of a specialized skill involving a fiduciary relationship, while 'business' denotes a profit-oriented enterprise).

While the service provider typically focuses on providing a level of service that it deems to be high-quality, this focus is misdirected. The issue is not whether the provider is giving superior service, but whether the consumer perceives him- or herself to be receiving it. Some literature suggests that the focus really should be on obtaining and retaining high-quality clients. The purpose behind the search for these clients is that a high-quality client will perceive and appreciate superior service. Clients that are not superior simply won't.

To retain high-quality clients, particular attention should be paid to the individual needs of the client. But how does the professional actually go about discovering and assessing the client's needs? An examination of current marketing technologies and some of the newer techniques (which most professionals have a particular advantage in using over other industries) will provide insight in this area.

Four potential shortfalls may lead to a gap between what clients expect or perceive and what they actually receive:

1. not knowing what clients expect in the first place
2. specifying service-quality standards that do not reflect what management believes to be the clients' expectations
3. service performance that does not match specifications
4. not living up to the levels of service performance promoted by marketing communications

In each of these situations, the overall theme of the failures is a lack of accurate communication. Not knowing what the client expects is the most basic of communication failure-the expectation might not be as great as the lawyer perceives, or the expectation may be unrealistically high. A service standard that does not reflect the client's expectations may actually be over-servicing a client. The actual service required by the client may be at a level lower than that being provided, and the client's reasons might not be well known to the professional (for example, lower cost, less paperwork, etc.).

Just as dangerous is to promise the client a certain level of service that cannot be delivered-for instance, providing periodic status reports when a crushing case load does not permit the time to do so.

Finally, advertising or communicating a level of service that you cannot meet is a terrible blow to the professional's credibility, and the exponential effect on negative referral can destroy a practice.

The service point failures may be caused by a client who is unable to express him- or herself accurately for a variety of reasons, but the professional also has a responsibility to develop the communications system with the client more fully.

'Organizations that are known for excellent service are good at listening to both their customers and their customer-contact employees.'

One of the biggest dangers in client contact in professional services is the personal offense taken by the professional or staff at a time when the frustrated client is simply trying to communicate the need for clearer dialogue and understanding. The technical and complex nature of most professional work causes the professional to focus on situational results rather than the client needs for particular service levels. Staff members, typically the first point of client contact, are particularly vulnerable to attacks of frustration.

Several time-tested marketing techniques may be utilized to gain a more full understanding of the client and the client's expectations.

Traditional forms of gathering marketing data include complaint analysis, post-transaction surveys, ongoing surveys, employee surveys, focus group interviews, 'mystery shopping,' and competitive market surveys. Most of these techniques are not well suited to professional services. But complaints are universal and have particular application to personal services. For the purpose of this article, the focus will be on complaints: why complaints are an important marketing tool, techniques in using complaints to further client relations and to turn a hostile situation into one of positive return.

Complaints provide an opportunity not only to study the fail points but to move the customer higher in the satisfaction scale. If the service provider can get beyond the emotional issue of an unhappy client, the learning process can begin.

With respect to products, the frequency range of complaints runs from 20% to 50% of the time, with the average being one-third. There's no indication that the service industry has a complaint ratio any different from that of manufacturers. This represents an alarmingly high ratio of dissatisfied clients. Consequently, attention needs to be paid to developing and maintaining an active process of soliciting client responses and dealing proactively with complaints: 'Learn what the customer expects in quality and performance, and monitor customer response continually.'

A key element of complainers is that 'More than half share their experiences with friends and relatives, and evidence indicates that negative word of mouth can have a major influence on the buying behavior of others.' Studies reflect that 55% to 60% of complaints are resolved to the consumer's satisfaction.

Beyond personal and cultural factors that determine or contribute to the complaint behavior of the consumer are the additional factors of (1) the significance of the event, (2) the knowledge and experience of the consumer, (3) the difficulty of seeking redress, and (4) the perceived probability that complaining will lead to retribution or some other, positive outcome.

The rendition of legal service, for example, is particularly susceptible to each of these factors. Legal events have particular significance to the consumer regardless of the routine nature of the event to the provider. Typically the knowledge and experience of the consumer is limited. Clients will typically have difficulty seeking redress-how many law firms have a consumer service department for receiving and remedying complaints? And quite often, complaints often lead to some price reduction in the service or some other form of comparable remediation. Of course, there's always the threat of a malpractice suit or State Bar complaint.

But complaints can be useful as market research data, and research suggests that a well-managed complaint-handling process can actually lead to increased sales.

Analysis (and resolution) of complaints takes on two time dimensions, with some independent consequences.

Real time complaints are those that are displayed at the time that the client or consumer is engaged in the actual service delivery process. In the legal industry, this typically occurs over a duration of time: during the pendancy of a single case, or over the course of numerous matters of representation.

Real-time complaints present two significant advantages over complaints received 'after the fact': a greater ability to recover the customer, and a greater ability to actually learn what the fail point was.

The ability to recover the customer at the point-of-service failure is a significant advantage. The real-time complaint process has an inherent ability to bring a hostile situation to a favorable outcome. 'There is significant, convincing evidence to support the principle that making a sincere effort to rectify problems will noticeably increase consumer assurance that the firm really cares. Not surprisingly, satisfaction and intent to repurchase are strengthened in the process.' Bottom line: It shows the client that you truly care.

The ability to learn about the fail point is greater with real-time complaints because memory is fresher and there's less opportunity for other factors to influence the consumer's behavior.

After-the-fact complaints are more limited in their market research potential. The passage of time may allow the interference of intervening factors, which might not be communicated or recognized. There is also a more limited ability to recover the client in after-the-fact complaint situations because the consumer has an opportunity to brood over the complaints and ferment greater dissatisfaction.

After-the-fact complaints also have a unique quality rooted in human behavior: Seemingly minor irritants may take on much greater importance and significance as the duration of the complaint process lengthens.

Still, after-the-fact complaints have market research value. They are just harder to obtain or use toward a positive outcome with the particular complaining client.

The Technical Assistance Research Program Institute (TARP) report argues that complaint handling should be seen as a profit center, not a cost center, and created a formula to help companies relate the value of retaining a profitable customer to the overall cost of funding an effective complaint-handling unit. The study showed positive returns on investment in the complaint-handling and remediation process.

Christopher Lovelock suggests charting the service process to identify potential fail points, including both the 'front-stage' and 'back-stage' processes. 'Front-stage' processes are those that the client or customer can readily see and come in contact with-receptionist activities, receipt of correspondence and documents, face-to-face contact with the professional and staff, etc. 'Back-stage' processes are those that the client doesn't see but nevertheless affect the quality of service that the client will receive: telephone conversations with others related to the client's cause, preparation of documents, court appearances (in law) where the client is not present, and so forth.

Lovelock touts the preparation of flowcharts to examine the service process. Flowcharts help identify links in the chain of service and identify where weaknesses may exist, or points where failure may occur. A flow chart would be created for each type of service operation. For instance, one would be created for the receipt and forwarding of a client telephone call to the attorney. Or a separate chart may examine the process of setting appointments, or the preparation of a patient for examination. (Flow-charting in this manner also has an unintended benefit: helping the service provider examine and eliminate inefficient processes.)

A specific kind of flow chart, 'control charts,' display performance over time against specific quality criteria. A 'control chart' is typically a fishbone chart or diagram that shows the cause and effect of factors that might be related to a specific problem. This type of charting helps the service provider narrow the possibilities of service point failure causation to expedite remediation strategies.

Flow-charting helps the service provider see where the client or customer is involved in the service-provision process. These are not only 'front-stage' points of possible failure but also points at which client participation needs to be optimized to facilitate client satisfaction and productive results. When customers (or clients) are deeply involved in the service production process, managers should be examining how customers' inputs can be made more productive.

There are three strategies to increasing the productivity of customer inputs to the service production process: changing the timing of customer demand (that is, shifting demand away from peak times), involving customers more in the production process, and asking customers to use third parties (specialist intermediaries).

The timing of customer demand can be easily related via the peaks-and-valleys nature of legal work. Phone calls are a prime example.

To the lawyer it seems as if everyone has problems all at the same time, and of course, everyone needs to have an answer yesterday. Voice mail has the ability of smoothing out the peaks and valleys by permitting the service provider to gather telephone messages and then return calls at the time of day the service provider directs. There's no reason why the client or customer cannot be advised in the voice mail greeting that his or her call will be returned during a certain period of time, so that they can be prepared for it. Alternatively, the client may advise of a different time when the lawyer could call if it's not possible to receive a call at the appointed time. This system permits the lawyer to control the timing of demand, and makes the lawyer look responsive to the client's service needs. Voice mail permits the flexibility necessary to change the return call time on a daily basis so that the service provider may enjoy a flexible schedule.

Involving the consumer more in the service production simply entails having the client do more for him or herself to accomplish the goals for which the professional was hired in the first place. For example, the preparation of a civil complaint need not be entirely done by the lawyer-much of a civil complaint contains stock language that for one reason or another has become traditional or 'necessary' and if left out could have disastrous results. There's no valid reason why a document with the necessary form language cannot be provided to the client so that the client can put the nature of the dispute in his or her own words. Of course, the lawyer will need to intercede with proper formatting. But the point is that if the client is involved in the process, he or she will obtain a much greater appreciation for the lawyer's work that goes into the preparing the document. Involving the consumer may consequently also cut the labor and cost of the service provider, though just as easily increase the cost. But generally, client involvement at this level gives the consumer a better understanding of the process and greater satisfaction in the outcome.

Asking the client to use the services of specialist intermediaries also increases the productivity of customer inputs to the service production process. This involves delegating one or more of the support functions to third parties. In the legal services industry, many lawyers feel threatened by paralegal services, which are able to provide many of the same services that a lawyer provides at a much lower expense. I advocate the use of paralegal services (and not a firm paralegal/employee) for delegation of non-lawyer duties such as preparing answers to interrogatories, preparing form documents, and general assistance. The consumer will appreciate his or her economic interests being first (rather than the lawyer's), and this will free up the lawyer from performing low-margin work.

Traditional marketing research usually consists of written surveys, telephone surveys, focus groups, and variations of these themes. These market research techniques have various shortcomings that are difficult or impossible to overcome: lack of candor, inability to monitor, inability to ask follow-up questions, low return, the potential for irritating people and thus alienating them, an inability to ask follow-up questions, and stale memories. Such research may end up being nothing more than a tracking study. Yet the professional is in a unique position relative to other industries because of the fiduciary and confidential relationship established when hired. The idea is to take advantage of these unique relationship qualities to implement the newer marketing technology of storytelling (which Jungian psychologists have been using for years).

The purpose of story telling is to get inside of the nonverbal communication. 'Just think, for example, of the last time you made eye contact with an attractive stranger. A whole range of feelings washed over you, and at that moment it would be hard to argue with the hoary notion that at least 80% of all human communication is nonverbal.'

The methodology of story telling in a marketing context involves drawing metaphors out of people to elicit their true feelings. Gerald Zaltman, Harvard Business School professor, has set up a working laboratory of metaphors. He asks consumers to spend a few weeks thinking about how they would visually represent their experiences with a company and then asks them to cut pictures from magazines that convey their feelings. Later, some subjects come to the lab and tell stories about the images and the connections between them.

A case study worth repeating: Du Pont Corp. turned to Zaltman because they thought that the standard line they were getting in their market research from women, that they wore pantyhose because they felt they had to and that they hated it, was inaccurate. Zaltman conducted storytelling market research, and the results were surprising: ''As we kept probing into the emotions behind the choice of these photos, the women finally began admitting that hose made them feel sensual, sexy, and more attractive to men,' says [Glenda] Green [a marketing research manager at Du Pont]. 'There's no way anyone would admit that in a focus group.''

Quicken and QuickBooks financial management software was originally the product of market research on non-customers. Intuit Corp. targeted non-customers to examine how they worked-leading to the invention of Quicken and QuickBooks. Intuit later instituted a 'Follow Me Home' program: Marketers and engineers peer over customer shoulders to see how they fare in their attempts to get the software installed and use the software. This program was eventually expanded where microcassette recorders were left at the homes of customers so that anytime customers got irritated they could simply press RECORD and file their complaints.

The benefits of storytelling from a marketing standpoint are a more accurate recording of the consumer's true feelings and a less expensive marketing research program. 'Gerald Zaltman claims that he stops hearing much that's new after 15 or 20 people have passed through this metaphor lab.'

The implications in professional services are enormous. The professional is in a daily position to elicit stories from the client, and in fact that is what the professional does a great deal of the time. The stories that the professional garners, though, are usually about the reason for consultation rather than the state of the professional services the client is receiving. The professional can use the service process, with client involvement, to solicit on a regular basis client feelings toward the service process. Some stories may be general in nature and some may be focused more on the anger inherent in the clients' problems, but all of them relate a story to how clients perceive the process as either helping or hurting them, and these stories have direct consequence to the perception they have toward the services being rendered.

For example, during the preparation of a complaint, the client may be asked how he or she felt writing the story down in a legal context. Was it demeaning? Was there anger? Did it help displace some negative feelings? This sort of investigation has broad application across the service provision process.

The retention of business needs to be a priority of the professional services provider. Retention of clients not only is cheaper than finding new ones, but has an exponential effect on subsequent referrals. At the same time, the practitioner needs to recognize that