Understanding the impact of thought leadership

By Fiona Czerniawska and Edward Haigh

Meet Joe.  Joe is a senior executive in a large organisation.  He’s also something of a McKinsey fan.

Picking up a copy of The coming era of on-demand marketing, he was impressed in every respect: McKinsey had, he believed, delivered real insight and made realistic recommendations, all supported by robust research.  But what made the report particularly memorable from Joe’s point of view was that it focused on an issue he was already thinking about. All this led him to do quite a lot with it: he discussed it with peers and subordinates, forwarded it to colleagues, and looked at other McKinsey material. He’s also considering implementing its recommendations.

What he hasn’t done is buy professional services from anyone (let alone McKinsey) a result of reading it; nor does he have any plans to do so.

This was a reach-out-and-grab-you piece of thought leadership, of which we don’t see enough from McKinsey (or any other firm for that matter). From the outset, it feels eminently readable and accessible, and even though the substance of the “scenes from the future of on-demand marketing” won’t feel especially revelatory to anyone who’s up to date with trends and thinking in this area, the way its presented is both arresting (especially given that it comes from McKinsey) and memorable.  And bear in mind that while McKinsey might not be breaking much genuinely new ground here – the absence of primary research gives it little chance to do so – for many of its readers, this may still feel like something new.

So why didn’t it have more impact on our friend Joe?

The lovely people at McKinsey might well respond that it had just the impact they were looking for: reinforcing brand awareness.  But we’re not convinced.

We’ve spent a good part of the summer analysing the impact thought leadership has.  This is an obviously and inherently tricky subject: how do you measure impact?  We decided to go to the horse’s mouth and ask clients: 400 US-based CXOs.  Half of these rarely read thought leadership, so that automatically halves the size of the ‘market’.  Of the remaining ‘active’ consumers, between 50% and 65% behaved like Joe, passing material on, reading more from the same firm, and so on.  But crucially what about a quarter did in response to the piece of material they remembered most was contact the firm concerned and, in many cases, buy services from them.  In fact, the proportion doing the latter was far higher than we expected and it tells us that thought leadership really can have a direct commercial impact.  But not all thought leadership is equal. As Joe’s behaviour illustrates, McKinsey has a strong thought leadership ‘brand’ but reading its material is relatively unlikely to services being bought.  Other firms – BCG for instance – have the opposite problem: the firm as often the first choice for thought leadership as McKinsey is, but its publications are far more likely to translate into revenue.

Matching feedback from clients about specific documents to quality ratings we’ve previously assigned to them helps us start to understand why some publications have a greater impact than others, but it also highlights the vital role that distribution and promotion play.  Some firms are highly respected by clients for their output, but rarely read in practice because their material doesn’t reach them or is overwhelmed by material from their competitors.  Impact, we’ve discovered, is the sum of quality and distribution.