When you have a successful consulting business, the first thing you learn is that you and your business always have to be top of mind. This is the importance of marketing methods in the way you do you work. Simon Chadwick is the Managing Partner at Cambiar LLC. He joins Michael Zipursky to talk about marketing methods that keep consulting businesses top of mind. Grow your business with these valuable methods and techniques that Simon discusses with Michael!
I’m with Simon Chadwick. Simon, welcome.
Thank you, Michael. It’s great to be here.
You’re an expert in the discipline of market research. You are looking at what you’ve accomplished and where you spend time. You see market research stamped on many occasions throughout your history. You have over 40 years of experience in guiding and managing all types of companies, including your firm, Cambiar, LLC. You’re a writer, an author, a speaker and a teacher. It seems like your interests extend far outside of business with an MA in Philosophy, Politics and Economics from Oxford. How have you found that your education in those areas has helped you in your entrepreneurial pursuits, if at all?
It’s interesting because I was lucky enough to go to Oxford. While I learned and took a Master’s in Philosophy, Politics and Economics, the one thing that they teach you there is how to think. Taking that into the business world and being able to absorb a lot of various and divergent information, thinking about that and trying to work out patterns. That was the biggest contributor to what I was able to do in business. From there, like anybody who’s gone into market research, it was a complete accident.
How did you go from that type of educational background in Oxford to getting into market research?
I graduated in the midst of a pretty severe recession. All my cohorts were going into accounting because it was the only place they could find a job. I was damned if I would be an accountant. I was looking for something that would combine the economics of my background with practical application in the world. I’m trying to make a difference in some ways. I was reading through a pamphlet from the big soap firm, Unilever. They had graduate trainee places. One of them was in market research and I thought, “That sounds interesting.” It combines the academic, the statistics but with real life. I applied and was lucky enough to get in. The rest was history.
You’ve taught graduate-level courses at universities around the country. Talk to us a little bit about how you’ve found teaching to either help or take away from building a business. I’m asking this because I’ve worked with several clients who are consultants. They’re working on building their business, but they also have opportunities or are actively already teaching at universities. Often, there are some tensions between the time that it takes to teach, yet the enjoyment they get from that. Deep down inside, feeling like it’s maybe not supporting their business in the best way. What has been your experience with that?
I haven’t experienced that tension as such. I enjoy teaching particularly in graduate classes where they’re there because they want to be there. I’ve taught everything from the basics of market research to how insights form within an organization, how they’re activated and how to do that. A lot of my training work is around that. I’m all the way through to political science. I started as a teacher in Kenya many years ago. The thing that I enjoyed was implanting ideas and ways of thinking that could enable people going forward into their lives to apply those ways of looking at issues, problems and data. Maybe they would bring something of what I had experienced in their jobs. Data literacy is incredibly important in business and is lacking in many areas.
Give us an example of that. When you say data literacy, what should people be thinking about when you mentioned that?
I’ll give you a very typical example. I don’t know if you followed this, but Apple launched a credit card. I believe they asked Goldman Sachs to manage it for them. It was the first card that Goldman Sachs had ever managed. They launched it. They had a very hard push campaign to get people to take the card. Couples we’re applying each person for the same card using the same data, same circumstances. The men in the couple would be getting credit limits 10 to 20 times that of the women. The reason was the algorithms that had been used to determine these credit limits were depending on learning and biases that existed in lending along for years. They didn’t have the literacy to understand what bias is in data and how if you put it into an algorithm, particularly, into machine learning, it’s going to get embedded. It’s going to grow and get worse.
How is that credit card going for them now?
I don’t think it’s going very well. The funny thing is that one of the first people who discovered this was one of the founders of Apple, Steve Wozniak. He got ten times the credit limit of his wife.Data literacy is incredibly important in business and is lacking in many areas. Click To Tweet
I’m interested to know how do you approach managing your time? You run your consulting firm. You’re teaching at universities and you are writing. What does your typical day or week look like? How are you able to stay productive?
My consulting work takes me to a number of different locations around the world, not necessarily physically but my time. For example, these last few years, we’ve been doing a lot of work in India and China. That means you’re either up very early in the morning or you’re up very late at night. You’re paying attention to those clients at those times. We have a basic client base in the US but quite a few in Europe as well. The time zones dictate what I’m doing at any particular time. Where the writing is concerned, if I didn’t have goals with China, I’d probably start writing at about 8:00 at night, right through until midnight, 1:00 in the morning. I get up the next morning and back into the consulting. I treat the teaching as very much part and parcel as the consulting. It’s part of my regular work routine.
Within your firm, what does your team look like? What does the structure look like within the company?
It’s evolved. We started as two people who had an idea based on no research whatsoever.
Which is not surprising given your background in market research.
It happens to work. We were strategic consulting at the time primarily. We specialized in the insights industry. As we sorted people’s strategies out and as you know, 90% of the success of a good strategy lies in the implementation. Our clients had come to us and say, “We need to sort out the marketing. and we need to work out the talent side of it or the financial side of it.” We grew our practices in those areas and brought in always very senior people who had walked in the shoes of the clients themselves. We base our firm very much on our experience, what we’ve done and what we’ve faced, not business school theory.
Are these full-time people? Are they contractors? How are they structured within the organization?
They were full-time people. A few years ago, my co-managing partner and I bought all our other partners out because the markets were changing and some of the partners themselves were coming to retirement age. Now, we rely much more heavily on a contractor model.
How does that work for you? How do you go about finding qualified people? This is a challenge for many consultants. They want to scale up. They want to move away from doing a lot of the deliverables or the actual client work themselves and free themselves up to spend more time on strategy and business development. Finding good quality people that they can rely on is often a challenge. What do you do or what have you found to work best in that area?
We’re very lucky in a way because we do specialize in one sector. Put it this way, in the insight sector and all the supply chain that goes around that.
When you say insights, to clarify for our audience, you’re talking companies that are doing market research and surveys or coming up with new data, is that what you’re referring to?
Yeah, and data analytics as well. That’s the primary focus of what we do. We know a lot of people in the industry. People tend to come to us, particularly people who have got to their 50s, all fed up with corporate life, want to get into the consulting business. We evaluate those very carefully. Usually, we know them very well. If they have a particular fit for what we want to do, we’ll bring them in. A third of our business, maybe more, is in corporate training. We also rely on people we know are good at that and who we’ve had experienced. That’s primarily the way we’ve gone about it, but one aspect of our business model that is probably self-limiting is that we depend on people who have significant experience at very senior levels. We have never brought in younger consultants to train up inside. That ultimately limits the business.
What’s the rationale behind that? Why not build a team, get younger people in, train them the way that you want things done? What’s your mindset around that decision?
It’s in our brand image, our brand value. What people see in us, which is these guys, they’ve got the same scars on their backs as we do. We want people who’ve been in that position. We don’t want a 30-year-old telling us what to do or even doing the groundwork is essentially, “We’re buying your experience.”
It’s always interesting to hear consultants who see their size as a negative and talking about, “There are larger companies, more established companies. How can I compete with them? This buyer would never do business with me. They’re going to go to Deloitte or McKinsey.” What you’ve hit on is a real competitive advantage, which is that when they pay a McKinsey or whoever else it is, they’re essentially paying a junior person to learn about the business and the industry. What you’re doing is bringing people who are seasoned. How do you deal with compensating the people that you work with? Are you using an hourly basis, and then charging the margin between what you’re getting paid and what you’re paying someone else? Are you doing our project, like a flat fee? Walk us through what a typical project would look like from a compensation perspective?
Training projects are the largest projects we do apart from when we sell a company and get a success fee. On a training project, we would usually work out what the need is and then negotiate a fixed price contract. That works very well because the temptation to lay on nice work is avoided.
Simon, sometimes consultants are concerned about setting projects or a flat fee. The concern is what if we don’t see certain things if we’ve underestimated the work that we need to do? How do you arrive at a number that you feel confident about? Especially when it’s not just you that’s going to be providing the work, it’s someone else. If it goes over, it means that you likely are going to be the one that’s going to have to pay the difference or go back to the client and renegotiate. What’s been your experience with that?
This is what we do on the training side, where we have a very good idea of what it’s going to take because we’re bringing in essentially modules that are 90% pre-baked by customizing them to our clients. If we’re doing a strategic consulting job, then it will be hourly. We’ll agree on hourly rates and we pay one month in arrears.
Can you share roughly what the margin is? The difference between what you might be earning from a client and what a consultant might make when they work with you.
It’s usually in the area of anywhere from 50% to 75%.
You mentioned that you have one form of work where you are paid a success fee. Talk to us a little bit about what that looks like, and when you are using that?
We have three primary planks for the business. One is strategic and operational consulting. The second is training. The third is mergers and acquisitions brokerage. We also do an acquisition, but primarily, we sell research, analytics and technology companies around the world. This is a fast consolidating sector of the industry. The reason that people come to us is because we know pretty much all the players around the world. We know what makes for value. In those cases, we worked to an hourly fee, a fairly low one because we want to encourage people to come in, but there is a significant success fee at the end of the transaction.
The success fee is based on what?
The success fee is based on the selling price of the company.On the training side, you need to have a good idea of what it’s going to take to do what you need done. Click To Tweet
The mergers and acquisitions, this is still related specifically to the insights industry?
I want to make that clear because definitely to some people on my list and go, “You do your offering very different services but for you, the central hub is that it’s still all connected to the insights industry.”
We know most of the players, we know most of those who are serial buyers, and we understand intuitively what makes for a good prospect, which makes for a good company to sell. We don’t need to learn the ropes. It’s the same concept. We’ve done this in our own corporate lives many times. We bought and we’ve sold. We can do this for people. We don’t have to learn the ropes.
We’ve talked about that you are able to attract consultants, contractors into your organization that is essentially doing a lot of the work for you and that’s because you’re well established in this industry. People know your name. You’ve been around the block a few times. Talk to us a little about how you go out, generate new leads, opportunities and business? What’s working best for you right now? What are the top three things that stand out for you that have the biggest impact when it comes to new leads and new opportunities for the pipeline?
That’s a good point because in the specialized business that we are, going out in a sales mode is often not terribly productive and also sometimes not very well received.
What do you mean by that?
If I call you up and go, “Michael, a long time since you’ve talked to me, surely you must have some stuff you need me to do. You’ve got problems.” You’re probably going to say, “No, I don’t think so.” What we’ve done over the years is we’ve built up a body of knowledge. One of your guests, Jono Bacon, he was talking about the value of knowledge, bringing knowledge into a consulting relationship. We do a number of studies every year on what’s happening in the industry. We go out and we talk at a lot of conferences. We do seminars. We do symposiums. We write articles. I’m also editor-in-chief of a magazine in the industry. We are known as the go-to people if you want to know what’s going on. That is what brings our clients to us.
Simon, there’s inevitably going to be someone who goes, “That’s why you’re successful is because you have all of that.” Going back many years, that wasn’t all in place. For our audience who are going, “That sounds amazing. How do I get to that place?” Was it about reaching out to different events and conferences and saying, “We’ve done this study, I’d love to come and talk,” or were there some other path you took to start to establish your footprint and presence in the industry?
This is going back several years now. We did initially do quite a lot of mail-outs and newsletters. Each newsletter had tippets of information or data or hints or whatever. This was the early internet.
You’re sending this out in print like print newsletters, print materials with people. It had valuable information in it, industry-related, and you were saying this to your ideal clients?
How did that work for you?
They worked pretty well. We grew, the first year, we did $90,000, the second year, $300,000. It grew very nicely, but it was at the point that we then started to do these studies. We would drag our way onto any conference platform we could find. Luckily, I and the other partners were pretty good on their feet. People would then come to us afterwards. It would take anywhere from a couple of weeks to a couple of years. They’d say, “I saw you at such and such, I think I’ve got something you can help us with.”
It’s that forward motion. That’s so important. The fact that you’re getting out there. It wasn’t necessarily one place you spoke out, but you and your team in multiple places, multiple touchpoints. I showed this example of our one client that signed up. He said to us when he came to one of our events that, “I’d been on your list for three years. I never bought anything from you.” All of a sudden, 1 day, 3 years later, he decided to become a client and ended up becoming a six-figure client. It’s interesting because I thought when he mentioned that like, “That’s why we send out a newsletter. That’s why we do these things is that if we stopped, he hasn’t been responsive. He hasn’t even bought a book from us. He hasn’t bought anything. It’s been 1 or 2 years or X number of months, given up then that would have been a lucrative sale that would not have happened.
You’ve got to keep on being in front of people, keep on having them trust in you. That’s a huge thing. Trust is massive. I’ve got a similar story. I was approached by a major credit card company at the end of 2019. The lady who approached me said, “I saw you. You gave a conference two and a half years ago. I was at a CPG company then, and I tried to convince them to use you, but somehow it never happened. Now, I’m in this credit card company and we can use you.”
It’s those little things that add up. You keep having little ones. You’re planting those seeds. You are watering the flowers and they’re going to bloom for you. If you’re not doing that consistently, then you’re not going to have a thriving pipeline. When you look back over the last couple of decades here of being in business and building up consulting businesses, I know that even before your business, you were CEO of other companies. From a consulting standpoint, what do you wish that you would have known in the early days that knowing now in hindsight, you go, “That would have made such a difference, I wish I would have done that?”
The interesting thing is that I’ve learned more about being a consultant than I have when I was a CEO. If I knew then what I know now, I didn’t mean then as a CEO, in the beginning, it was about building a brand that had a story to it that was consistent. For the first 2 or 3 years, we were a little bit too much everything to all people. It was only when we focused down that we became successful.
A principle of success in this business, common sense tells many people, “You can go wide. You have so many skills. There are so many different people that you can help and apply your knowledge,” but it’s very hard when you have limited resources, which is what most of us have. We’re not a billion organization to use the resource that we have effectively for targeting multiple different industries or people that means do you have to have a different messaging, different offers. It creates a lot of complexity. I’m glad that you shared that’s also been your experience because I know it’s been the same for many other people.
There was another lesson that we learned as well which is, “Don’t assume that because you’ve got one type of assignment, that there are any more of those that out there.” My point is you have to remain agile and shape your offering so that people could buy it. We got a nine months assignment to completely and utterly reinvent the insights and competitive intelligence function of a major fund company. It was a huge assignment. It was a lot of fun. We were very successful. We thought, “We can do this. We’ll go out and we’ll market ourselves as people who can reinvent your insights function.” We never got one again.
Why do you think that is?
Essentially, it only occurs when a new CMO comes in and says, “I need something different,” or when a new SVP of Insights comes in and says, “I need to completely reshape this.” Those things don’t happen very often. We learned, “If we chunked this up into different learning modules, different training modules and made them bitable, bite-size, then maybe we can go into these same companies,” and that was hugely successful.
With the training, when you broke those down into bite-sized training modules or components that you or your team could deliver, did you approach those companies and say, “We have this training as assigned, that would be a workshop,” and they say, “They have an interest to you,” or did you do your speaking, writing thing studies, then people came to you and then you offered it to them?
We did a bit of both. It’s probably true to say that a lot of word of mouth was involved. Essentially, if you go in and you do a good training assignment, some of these training assignments can take 2 or 3 years.It’s only when you focus down that you become successful. Click To Tweet
We’re not talking about a one-day workshop and $5,000 or $10,000 later.
We’re talking six figures. Our clients get together and they talk about things that they’ve done. You then get a call out of the blue. In many ways, what we did was, we built multi-client seminars, charged a very low amount for them.
What will be the amount just roughly?
It’s $1,000 a head. To come in for a day and experience some of the training, we get 15 or 20 people in a room from different industries.
How did you market that? Was it sending emails, making phone calls, posting on LinkedIn or something?
All of the above. Also, through our supply-side clients as well because they all have corporate clients. We’d get them to organize a seminar of their clients and then we’d come in. For those supply-side clients, that was a huge marketing boom for them. They all seem to be providing a free service to their client.
Would they pay you at discounted rates? If the typical was $1,000, would they pay you $800 or something? Would they pay the full price?
They would get a very discounted rate. We’d have fifteen people in a room and maybe charge $5,000 or $7,000 to our clients.
It’s a value-add for them. They get their clients together. They’re providing this free experience, which is very valuable and appreciated by their clients. Did that lead to business opportunities for you from doing that?
Yes. You’re probably looking at 1 in 10, 1 in 15, who would become a business opportunity and it may take a year, two years. You have to have this great patience. The other thing that we very successfully did, and this was one of my partners who thought this up, was to approach trade associations and offered to do webinar series of the training modules to their members. That’s a relatively low price to the association because they don’t have a lot of money usually. That then spreads the word because a lot of people experienced it online.
Simon, those are some great information. I appreciate you sharing it here. I want to take a moment because you publish a book called For The People. Tell us a little bit about what that book is, the topic of it, and then I also want to find out from you where people can go to learn more about the book and you as well.
It has nothing to do with market research, data analytics or anything like that. This is returning to my roots. This is a political science book. You and I were chatting before, I grew up in South Africa during the apartheid years. I have a very firsthand experience of what it’s like to live in a totalitarian society. My father was a major anti-apartheid activist. I’ve worked in other countries of that nature as well. As we have been proceeding in the last few years, I have started to notice tell-tale signals of the same things happening here. Instead of throwing my hands up, I decided that I would write a book about how we could have a different system. A system of society and government that would work much better for everybody. I did that through the lens of Maslow’s Hierarchy.
Where can people go to learn more about your book?
Simon, thank you so much for coming on.
It’s been a real pleasure, Michael. Thank you very much.
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- Informational YouTube video: https://youtu.be/vqFw-2l7_2M
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