Four Secrets of High-growth Construction Firms
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[Article was originally posted on www.constructionexec.com]
By Karl Feldman,
Firms in the architecture, engineering and construction (AEC) industry face a variety of challenges, including struggling to find and keep top talent, an unpredictable marketplace and a landscape that is more competitive than ever. However, despite these challenges, many construction firms are continuing to grow and thrive—even while growth rates in the industry as a whole have slowed. In fact, nearly one-third of AEC firms report a rate of growth that is nearly three times the industry average. What sets these high-growth firms apart?
To answer this question, the Hinge Research Institute surveyed more than 200 AEC firms about their marketing and revenue generation. The companies surveyed ranged from small firms with less than $1 million in annual revenue to powerhouse companies generating more than $50 million per year.
1. A shift in perspective
The issues and challenges high-growth construction firms focus on tend to differ significantly from their slower-growth peers. This is especially true when it comes to the concerns they have for the future. While low-growth firms may get caught up in worrying about wide-ranging threats such as increased competition and price pressure, high-growth firms are more concerned with understanding the unpredictable marketplace and unreasonable client demands. By focusing on specific threats instead of seeing threats everywhere, high-growth firms are able to gain a much-needed perspective on their challenges.
2. A change in approach
The tactics high-growth construction firms use to react to challenges and threats also differ. The study found that high-growth firms are four times as likely to conduct frequent research on their target markets—with 40 percent surveying the marketplace at least once a year compared to only 11 percent of no-growth firms doing the same. And while high-growth firms typically avoid specializing in a particular industry, they are significantly more likely to specialize in the services they offer. On the contrary, no-growth firms were more likely to specialize in an industry, rather than in any specific skill set or approach.
3. An advantage in expertise
Survey respondents were also asked to rate the skill level of their subject matter experts in a variety of marketing techniques. The subject matter experts at high-growth AEC firms were more likely to have a higher skill level in virtually all areas of business development, including networking, writing and speaking. In some cases, the difference between skill rankings was substantial. By possessing an advantage in these skills, the experts at high-growth firms are more likely to seek out opportunities to become more visible in the marketplace.
4. A difference in strategy
While AEC firms generally are slower to adopt digital or content marketing techniques than other professional services industries, high-growth firms are still allocating their marketing dollars differently than their slower-growth peers. The size of their marketing investment is similar, but their priorities are significantly different. This is especially evident in the likelihood of high-growth firms to embrace digital or content marketing strategies, making them twice as likely to use these techniques as no-growth firms.
That’s not to say that high-growth construction firms aren’t still using traditional marketing tactics, because they are. However, they’re also far more likely to use conferences, events, assessments and consultations to their advantage. All of these strategies put them directly in front of prospects. No-growth firms focus their marketing efforts on collateral and sponsorships, which have less visibility and are typically slower to produce new business.
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