The importance of adding value: French clients and the Big Four

By Alison Huntington

The headline of our Client Perception Study in the French consulting market is that 59% of clients are willing to pay more for the services of the leading consulting firms. Yes, you read that right.

This news may come as a surprise – France is still a tough market, where every percentile of growth is fought for, tooth and nail. And they may wonder where all these clients are hiding. We can’t tell you that, but what is important to know is there are far more clients willing to pay more for some firm types, and far fewer for others.

The big winners are the technology firms: 83% of clients are willing to pay more for the services of these firms, and none say they’d prefer to pay less. Strategy firms also do very well – nearly two thirds of their clients are willing to pay more, including a full 15% that say they’re willing to pay 50% more.

Compared to that the figure for the Big Four looks a little measly: just over a third of the Big Four’s clients are willing to pay more for their services – a figure that’s remained stagnant since last year. Next to the mounting proportions of technology and strategy firm clients who are willing to pay more, it’s a little underwhelming.

Why doesn’t the good news story apply so much to the Big Four? At least part of the answer lies in clients’ changing perceptions of quality and value.

Clients’ perceptions of the quality of the Big Four firms’ work has worsened since we spoke to them last year. In fact, the proportion describing the quality of the Big Four as ‘high’ or ‘very high’ is down to just under half, falling by seven points. It’s not damning by any means, but it is a cause for concern, particularly when compared with the soaring opinions about technology firms.

Things get complicated, however, when it comes to perceptions of value. The Big Four actually do much better than they did last year – the share of clients with positive value perceptions rises to half of all clients. It would be tempting to conclude that the falling share of clients that rate the firm high quality is cancelled out by the rise in the number of clients with positive value perceptions, but it’s not as straightforward as that.

Breaking down responses by direct clients (those already working with the firm) and indirect clients (for which read: prospects) reveals that it’s the value added that bears the closest relationship to clients’ willingness to pay more. Direct clients’ perceptions of value are down, and correspondingly, so is their willingness to pay more for the Big Four firms. Indirect clients, on the other hand, have a vastly improved perception of the value added by the Big Four, and we see a large increase the proportion of prospective clients eager to pay more for the services of these firms.

It’s clear that to persuade clients that a fee rate is justifiable, the Big Four need to ensure the value of their work is articulated in a way that resonates with both prospective clients – which they seem to have cracked – and with their direct clients, where something has gone wrong since last year.