High Growth Study 2024
For the second year in a row, the Hinge Research Institute’s annual High Growth Study showed that uncertainty is professional services firms’ overriding concern. Uncertainty overshadows the war for talent and worries about increased competition. Conflicts across the globe, mixed economic signals and political instability add smoke to a marketplace that’s undergoing change at breakneck speed.
Yet in spite of these challenges, overall growth rates improved over the prior year. And the best performers, which we call High Growth firms, accelerated their growth compared to their slower-growing counterparts. These high flyers grew 4X faster and enjoyed almost 2X the profits.
How did they do it? What do they do differently from other firms? Questions like these are what we designed this study to answer.
About the Study
This is the ninth edition of the High Growth Study. 824 firms across six professional services industry groups participated in this year’s research. The figure below shows the distribution of these industries in the sample.
Participants represented firms of all sizes, and they conducted business in every region of the globe.
In the study, we grouped the participating firms into three categories: High Growth (see definition in the next section below), No Growth (those that experienced zero or negative growth), and Average Growth (the rest of the sample). Occasionally, you will encounter a group called Low Growth. This group includes both Average Growth and No Growth firms.
The High Growth Advantage
We define High Growth firms as those firms that achieve at least 20% compound annual growth over a three-year evaluation period. We compare these firms to those that experienced little or no growth over the same time frame. This allows us to identify strategies and practices that are associated with faster growth and higher profits.
This year’s High Growth cohort grew at an average rate of 41%—a significant jump over the previous year. By comparison, average Growth firms grew at 10% per year.
At the same time, High Growth firms are also more profitable than their slower-growing brethren. High Growth firms enjoyed an average profit of 25%—a slight improvement over the previous year’s number. However, all growth categories saw their profitability grow over the previous year. Even the group with negative growth, No Growth firms, achieved an average profit of almost 15%.
Five Key Pathways to Growth
Uncertainty has been a major cloud over the professional services industry for the past several years, and we don’t believe it is going away anytime soon. That means professional services firms need to adapt their marketing strategies to address a fickle, evolving marketplace. And there is no better place to look for inspiration than the High Growth firms that have thrived in it.
We’ve selected five key findings from the study that firms like yours can use to compare against your own marketing strategy as you drive toward sustained growth.
1. High Growth Firms Use Marketing to Support Closing the Sale
Unlike past years, when digital techniques dominated this list, today’s High Growth firms are getting the most bang by using marketing to support sales-oriented, bottom-of-the-funnel activities. In the chart below, you’ll see that the top three most impactful techniques identified by High Growth firms were 1) assessments and consultations, 2) live demos, and 3) business development materials, such as qualifications presentations, pitch materials, and proposals.
Why the change? We’ve noticed that over the past three years, High Growth firms have invested more than their slower growing competitors in digital marketing techniques and digital infrastructure such as CRM, AI, and marketing automation. We think this early investment is now paying dividends. Many tasks that once were manual—or weren’t done at all—are now automated and efficient. As a result, it’s faster and easier to close new business.
Don’t lose sight of #5. High Growth firms have been a perennial leader when it comes to conducting formal research on their target audience. We believe this is an important way they are able to see past any uncertainty and make better informed, more confident decisions.
