According to David Maister, there are 4 types of professional firms:
Maister sorts them by two degrees:
1- The degree of customization needed to solve the client’s problem
2- The degree of client contact required to deliver the services
My main business is providing a systematic, proven way to host an interview podcast. The degree of customization and client contact are both low. In other words, I’m in the Pharmacy business.
But in marketing consulting, I’m working very closely with clients to create completely custom solutions. I’m in the Psychotherapy business.
I’ve found that as I better understand the business I’m in, I have more clarity on:
Where I can use leverage (or can’t)
What my client values most
How to better deliver my service
How to convey my value better to potential clients
How to get more profitable
What really fascinates are hybrid models.
Vyral Marketing is a great example. They sell a proven, repeatable video marketing plan to professionals. They’re in the Pharmacy business, too.
But behind the scenes they provide all sorts of ancillary benefits – copywriting, business ideas, marketing and lead generation experiments and much more.
Clients don’t expect these additional services, which are Brain Surgeon and Psychotherapy services.
Vyral doesn’t charge for these additional services, either. They use them as value add to build deeper relationships with clients and ensure that clients stay for life.
In other words, Vyral has figured out a hybrid model that solves the profitability problem of the Pharmacy business – being treated as a commodity and getting price-shopped by disloyal clients with no personal relationship to the business.
Understanding the business you’re in gives you clarity. But it gets a lot more fun when that clarity leads to creative solutions like hybrid models.