Consultant, some early decisions you make can significantly affect new client acquisition and pricing.
One of those early decisions is:
Choosing your market segment carefully. đŻ
A market segment is a group of organizations with similar challenges and needs you could potentially sell to.
Your ideal, high-value market segment is one in which you have exceptional expertise, can deliver results clients desire and can generate high profits.
Most consultants, even experienced ones, get this wrong and this leads to years of slow growth and pain.
If thatâs what youâre going through, ensure you review your target market segment. Here are some ways you could segment your market:
â ⥠Vertical market focus
This entails deep industry focus (E.g. Big pharmaceutical companies, Banks, small clothing manufacturers).
Consulting buyers love to ask indirectly or directly, âHave you worked in my industry before?â They want to be comfortable that you know the industryâs language, key success factors, etc. For this reason, this is my favourite type of segmentation for consultants as it offers competitive differentiation and premium pricing advantages. But that doesnât mean everyone should do it.
â ⥠Horizontal market focus
This entails expertise that can be applied across industries. For example, if youâre a HR expert focused on compliance for small businesses, you can target companies across industries. So too if youâre a quality management consultant dealing with a specific type of expertise like ISO:9002, for example.
It can be harder to convert clients than if youâre focused on a vertical, but that can be balanced by having access to a wider pool of prospects to choose from. However, you need to have a very good reason why youâre horizontal and not vertical. Donât just go horizontal just because you donât want to feel âtied downâ.
â ⥠Customer characteristics focus
This entails segmenting your market based on unique customer characteristics. For example, minority-owned businesses, or expatriate-owned companies. If your offer focuses on a specific type of organization and buyer, you can target them and have easier access to this market.
I know consultants who do exceptionally well while segmenting their market in each of the above ways. The best ones constantly review their choices and change their market as and when their goals and markets change.
Ready to add $100k-$500k revenue to your consulting business in 12 months or less without burning out? Schedule a call and let me show you how.
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