How I'd sell Strategic Design Consulting in a downturn
How I'd sell Strategic Design Consulting in a downturn
Based on a question from my Masterclass
This post is inspired by a question sent by Nate Gerber, while signing he was signing up for my Masterclass on how Niche Experts can create their own workshops. Thank you Nate!
Also, Nate has not reviewed this post. Any mistakes are mine and not his.
All my advice is further down. Feeling anxious? Scroll down to the picture of Sun Tzu
Strategic Design can be hard to explain.
For today, let's just define it as using Design tools to explore and define strategic decisions.
For example:
How can a company address changing customer needs;
how an org can evolve to become nimbler and more adaptable;
how to incentivize a community towards alignment.
Selling abstraction in a downturn.
To Design is a verb strongly related to action and decision. When you design, you bring clarity and reduce uncertainty. And Strategy is also a word about decisions and focus.
What's ironic is that Strategic Design can appear a bit abstract. And selling abstraction is harder when money is tight. Like right now, for many industries.
Based on Nate's excellent question, I went looking for answers.
This whole post can be summarized with:
in a Downturn, sell concrete, tangible stuff that addresses pain points your clients struggle with.
Past crises and how others weathered them
There are a lot of strategic consultancy firms. Only a few of them sell Strategic Design, but the mechanics of the job don't change as much.
Downturns affect consultancies because they affect their client's and their client's customers. So this is what we investigate. Links at the bottom.
How your clients react to a crisis.
Clients of consultancy firms often defensively react to downturns like this:
they cut spending
Projects with unclear or underwhelming results are the first victims
Projects that haven't started yet are also prime targets for the chopping board
they focus on what already works
Companies assess their performance using (among other things) Discounted Cash Flow. DCF assumes the dollar you have today is worth more than the dollar you might have tomorrow. This means that if a project is not bringing in results and a prioritizing decision must be made (they likely cut spending, remember) , what works today is what survives. Future initiatives, no matter how promising, are in risk.
extend payment terms
This is about their liquidity. As a supplier of Strategic Design it is unlikely you represent a massive cost for your clients. But there might be new procurement and payment processing directives in place that affect you.
These are classic defensive maneuvers, some clients take more active measures:
Automate, re-structure and re-price;
They know the world has changed and what worked before is now insufficient. They move to change how they do things, how they pay for things and how the charge for things.
Build deeper connections with their customer base;
Companies that pay for Strategic Design are by definition more customer-centric than average (or try to be) and they will know that their own customer base will make difficult decisions in the near term. So your best clients will proactively engage and learn from their customers, to figure out how to stay relevant to them.
Buy other companies.
This is less common, but the mark of company taking courageous steps, trusting that all crises end. These clients are more likely to make a killing when the tide rises again.
What Strategic Design Consultancies can do to sell in this environment
Be very clear on Outcomes
Help clients find efficiency where it matters
Engage with past satisfied clients to sell more to them
Shape projects so that you spend more time with your client
Be very clear on Outcomes
When things are fuzzy, clarity is valued. As much as you can, shape your offers to be extremely clear on what value they generate for your client. Benefit is great, but value is even better. A good way to do this is to attach what you sell to their business objectives.
Don't call it a Design Sprint, call it a Increase Onboarding Rates Sprint
Help clients find efficiency where it matters
If clients need to cut costs, that's a reality you cannot change. But you can steer a little bit of that conversation. Learn how to present your projects in a way that speaks to the decision makers. In a downturn, this can mean the CFO. So talk in a way that makes sense to them. Not just with the sort of words you use, but even you you think about the project (e.g. Asset/Liability; Capex/Opex; Top-Line/Bottom-Line, etc.)
Explore alternative payment terms and frame the deliverables in terms that make financial sense. This LinkedIn post has a great example of this.
Engage with past satisfied clients to sell more to them
Trust is essential to sell consulting services. Your past clients have seen you do good work and, perhaps more importantly, you have seen their unique challenges. You have access to their world and you can create products that address those pain points.
Brainstorm internally what your client's problems are and create a quick presentation on how you have a product for that.
Don't sell the method (e.g. Design Thinking), sell the result (e.g. “Learn what your customers need to sell them more stuff”)
Shape projects so that you spend more time with your client
One-off consulting is difficult because the sales cycle can be longer than the engagement. When every purchase is being scrutinized by the client, you want to have less purchases and have each one of them keep you working together for longer periods.
This helps with you becoming embedded in the organization and a part of how they function (harder to dispense in a pinch). The added benefit is the relationships you build and how much you learn about your client (that can be converted into products you sell them).
Sell them a workshop at a lower entry price but with more mentoring sessions for their team. (e.g. “"Increase team resiliency workshop" + 4 sessions to track progress and support their transformation)
Everything is uncertain
I don't do all of these things routinely. I experiment with some, others I've read about (links at the end). My point is less about the prescriptive side of things and more about how to adapt your view of the current environment. Companies have a lot on their plate and we're facing some serious volatility. Nothing is guaranteed.
But by shifting your approach towards applying your skills to new and pressing problems, I believe you have a better chance of making it.