The Marketing Cycle of Accounting Firms

Tax season represents one of the best opportunities to build
your lead pipeline for the
upcoming year. Your firm will
touch almost every client
in the next few months, which
increases retention, presents
cross-selling opportunities
and provides the chance to
ask for referrals. One of
the most common problems accounting
firms have is communication
with their clientele. Although
most firms manage to address
compliance needs, they do
not always have the time to
investigate or suggest extended
service opportunities.

The culprit is the time compression
of the service delivery period.
The demand for services combined
with deadlines create a situation
that takes the advisory capacity
away from accountants and
turns them into a volume-producing
machine. If they don’t
develop a ‘crank and
churn’ mentality, they
will miss deadlines or drive
staff so hard that the firm
will have a difficult time
with recruiting and retention.

By default, firms are forced
to first concentrate on compliance
services and then address
advisory services. Most firms
never get the number of consulting
engagement opportunities needed
to evolve their advisory services
to its fullest potential.
Accounting firms ‘advertise’
consulting capabilities in
their web sites and literature,
but when pressed for details,
the consulting is often tax
or estate planning. Yes, those
services are critical, but
the CEO is ‘time-strapped’
just like you and needs someone
to help with operational insight.
It’s the ‘non-tax’
advisory areas that can really
grow in most firms.

A large company CEO has a
‘crew’ of advisors.
CEOs surround themselves with
vice presidents and industry
specialists. Your entrepreneurial
and emerging or mid-sized
clients are often equipped
with a good, but limited support
staff. They are more dependent
on input from outside advisors
or learn to be self-reliant.
Advisory-minded firms increase
revenues with existing clients
by embracing the role of the
outside advisor. This consultative
approach is often used to
‘steal’ high-paying
compliance business away from
competitors.

You set the business tone
with clients. If the initial
conversation is on tax and
audit issues, and the focus
remains tax and audit oriented,
then the opportunity to transcend
to the trusted confidant level
diminishes. Clients require
tax and audit services, but
they may not value them because
they do not understand the
effort or strategy involved
in tax planning or a thorough
audit. When a professional
assumes that a client understands
the value they are providing,
they undermine the value of
their services.

Marketing starts in tax season.
The focus on meeting deadlines
is difficult to overcome,
but if a firm wants to expand
revenues they need to take
time to interview clients.
This is really a data collection
process that captures needs
and at the same time educates
the client so they understand
why they may have other concerns
beyond tax or accounting issues.

Tailor
a business development approach
to fit your firm’s style,
delivery capabilities and
realistic win possibilities.
Focus on five different targets:

Existing Clients. Mine for advisory service
sales and referrals. Don’t
be afraid to sell more because
of perceived fee concerns.
When you suggest other services,
make sure clients understand
why they need the service
as well as the benefits
they will receive. Sell
the value!
Direct Prospects. The groups you target ‘ private companies, public entities, non-profit organizations, etc. ‘ are dependent on the skills and preferences of your firm. Use a rifle approach rather than a shotgun strategy.
Referral Sources. Get them selling for the firm by communicating and educating these groups. Send differentiating messages and an OFFER they can pass along to their clients and referral sources. Referral
partner marketing can create
an annuity of leads.
Media & Associations. Perception is a vital part of acceptance. Articles and speaking engagements can create tremendous goodwill and make small firms look mighty. Speaking engagements and writing aren’t for everyone. If you can’t speak, write. If you can’t write, hire a ghostwriter. It’s a common practice.
Other Accounting Firms. Annually, every practitioner should conduct a search to acquire another firm. This builds a pipeline of opportunities. A $500,000 firm acquiring a $150,000 practice increases
the value of the firm by
30 percent. After a few
acquisitions, the value
of any practice will significantly
grow. Any firm, regardless
of its size, should be searching
for acquisitions after tax
season.

Properly size your targets. A 10-person firm should not expect IBM to turn its tax work over to them. Unless you have an inside track or a well-defined and identified niche, the larger the prospect, the more risk the CFO takes by engaging a smaller firm. The safer bet for the CFO is to hire the firm that represents the lowest risk possible at the most cost-effective price. If something goes wrong, it is easy to defend their selection if they have hired a known
name. If the CFO hires ABC,
LLP and issues arise, the
CFO may end up looking for
a new job. Remember this when
defining targets. Whether
you can do the work is not
material. It is the prospect’s
needs and fears you must learn
how to read. The best solution
does not always win.

Look at your bids. When the opportunity comes to present a proposal, examine your presentation from the shoes of the CFO, Controller or CEO. Evaluate these factors:

Price. To a good prospect, the lowest price can send a caution flag. If you are the highest, they better really want your firm. Most prospects want to make a ‘safe’ selection. If the prospect wants the cheapest price possible, then you should just walk from the opportunity. There is a ‘percentage’ method we teach clients to make the CFO feel safe while cutting costs. It’s a risk hedge approach.
Quality of the proposal. Does your proposal or engagement letter look appealing or does it look like a contract? Sell the value of what you are going to do before detailing penalty clauses or legal
terms. Most engagement letters
or proposals describe the
services being done in two
sentences and often have
two pages of ‘what
will happen if’ terminology.
Sell the benefits more and
the details less.
Presentation of the engagement. Try color, bold fonts and maybe use a picture. Make your firm look professional and appealing. If four accountants are lined up and three are dressed in black suits with white shirts and a black tie, and one has a colored tie, which one will stand out? The same logic applies to a prospect’s selection thought process.

Packaging does make a difference. Prospects want a good deal, but they also want to do business with someone with a little ‘flavor and personality.’ Build the human bond when selling because it is a major
and greatly underestimated
factor in the decision process.

A ‘quick’ bid
can be a bad approach. For
example, we are having some
work done on our facility.
A contractor showed up and
in 10 minutes wrote up an
estimate to knock down a wall,
put up two more and add a
few doors. He did not measure
anything and just put down
a lump sum. It was our first
bid, but we immediately got
the feeling he was 50 percent
guessing the job and did not
think any part of it through.
It may be a great deal, but
we got the sense from his
lack of detail that the potentially
great deal may actually be
a ‘great deal of headaches’
for us. We did not question
his numbers as much as his
thought process.

Methods
to Consider Based on the Size
of the Client:

Small Client Considerations. Get clients talking about their personal plans. It makes them feel comfortable and demonstrates that you are interested in their life.

Ask about retirement planning. Do they have a 401K to
rollover or insurance
needs? College needs?
Inquire about elderly
care needs. Your stable,
middle-class, boring 1040
may be sitting on a million-dollar
inheritance.
Discuss their goals for
the next year. Are they
planning to buy a house,
change jobs, adopt a child,
etc.? Get them talking.
As they talk about their
needs, they will share
details that present sales
opportunities. They can
get generic return preparation
from a software product.
It’s the personal
attention and the ability
to answer questions that
creates premium value.

Mid-Size Emerging & Business Client Ideas

Incorporate
the points from above.
These are basic client
care issues.
Add in specialty services.
This includes budgets,
forecasts, valuations,
succession and exit strategies,
as well as general strategic
growth needs.
Become the advisor to
the CEO. If the prospect
has a financial executive
in place, you have to
decide if that person
is strong enough to be
the relationship point
for your firm or if you
need to push for the CEO
relationship.

Large Client Thoughts

Address the items identified with the small and mid-size clients. The level of assistance needed will
vary with each client’s
internal investment
in support personnel.
If they have specialist
managing their interests,
they may need less advisory
direction from their
accountant.
Position
high-level assistance.
Offer to help in areas
such as mergers, acquisitions
or divestiture strategies.
Even if they have high-level
support professionals
in-house, your firm’s
experience with other
clients may be valuable.
Become
the advisor to the CFO.
In a large prospect,
the CFO should be your
target because they
normally are in a position
of authority on financial
matters. But its of
great importance to
realize that if you
try to end run the CFO
of a large company,
they will do what they
can to prevent you from
getting in the door.

Examine
the marketing cycle your firm
should create. The Marketing
Cycle graphic refers to
ideas almost any firm should
incorporate into their strategies.
Each firm may have nuances,
niches or hot topics that
fall outside of the norm,
but use this cycle as a guideline
to build your firm’s
approach.

Bob
Lewis is the founder of Visionary
Marketing – a firm that helps
CPA firms develop marketing
strategies to target new clients,
increase existing client revenues,
and build referral partner
networks. Visionary works
with marketing directors,
or becomes the marketing director
for smaller firms. Mr. Lewis
can be reached at 800.995.9186,
blewis@ThinkVisionary.com
or at www.ThinkVisionary.com.

Advisory