Marketing challenges surround consulting companies in general. Some of these challenges are old while some are new. There are many forces that make way for change in the industry and they are varied as well.
The following are the major challenges that are faced in the consulting industry:
ULTIMATELY INCREASING COMPETITION
Most consulting firms consider competition to be their number one concern. Most of them worry about new players and larger firms. Most firms that are not established or not really large players in the market are worried about staying afloat and being competitive. The truth is that consolidations are happening around the consulting industry and new technologies appear to be threatening the commodification of some staple industries.
These days, the consulting industry is a huge battlefield. It used to be that consulting industry prospers primarily from interpersonal interaction but today there is a wide open battlefield online among different companies. This is where the companies compete with each other and buyers tend to select the winners among them. On top of that, the entire consulting industry landscape is rapidly changing too. There are acquisitions and mergers that are happening around at a record-breaking rate. Every now and then there are well-funded companies that will sprout. This type of marketplace seems to be staying.
CHANGES IN BUYER’S PREFERENCES AND SERVICE NEEDS
There are major changes in the way consumers purchase products or services. They are more driven by increased online search, more social media use, and the use of non-traditional platforms for finding consulting firms. Referrals have changed tremendously as well. Referrals today can be done by people who did not even hire the consulting firm in the past but found out about the firm from another source. Firms are also enhancing their reputation online through the use of sophisticated tools for content marketing and direct engagement through social media sites.
NEED FOR ENHANCING SKILLS
It is a common challenge for consulting firms to retool their employees. Each time a new technology or technique sets in, the consulting firm feels the pressure to keep up. If they don’t, they cannot compete in the market. There are two major means to resolve this challenge: retraining the professionals and hiring new talent who possesses all the necessary skills. Most firms apply these two methods but they both have major challenges too. First off, it is expensive to hire new people and retooling current employees will take away people from billable work.
CONSTANT PRESSURE TO DECREASE PRICE
Another top concern among consulting firms is the constant pressure to bring down the price. This challenge is related to all the other concerns such as increasing competition, automation, commodification, technology disruption, etc. In the advent of cheaper alternatives and technologies that emerged, there is constant pressure on the firms to decrease their rates for services.
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