The marketing practices‐performance relationship in professional service firms

Purpose – The purpose of this paper is to investigate marketing practices in professional service firms (PSFs). PSFs' marketing practices are not well understood, despite their increasing importance to economies worldwide and recognition of their unique characteristics and the marketing challenges they face. The study also examined whether PSF performance outcomes is better modeled through a competency approach suggested by the resource‐based view, or through the extent of use (practices) approach. Design/methodology/approach – Empirical data were collected from professional service providers through an online survey of senior professional service providers across a range of services, including law, engineering, accounting and finance and management consultancy. Findings – Results show interaction marketing was the most common PSF practice and the combination of extent of use and competency, rather than extent of use alone, is a better predictor of firm performance. The results also demonstrate the relevance of the plurality of practices. Research limitations/implications – The study shows that transaction marketing and database marketing are particularly necessary for financial and market performance, while both interaction marketing and database marketing particularly underpin customer performance. All practices need to be conducted extensively and well for optimum outcomes. The study is cross‐sectional in nature and does not enable a judgment about causal inferences; rather, relationships between constructs are presented. Practical implications – Professional service providers should focus on competency of practice, as well as extent of practice. However, not all professional service providers do this. Importantly, having a customer service focus is not sufficient to achieve positive market and financial outcomes. Originality/value – The results presented in the paper have important implications for researchers when modeling and measuring marketing practices and for professional service managers when undertaking marketing activities.