Marketing for Accountancy Practices
Author: Phil Shohet
The concept of marketing as a strategic tool to improve profitability and accelerate practice growth is something the profession has now accepted and almost all firms use marketing in one form or another as a means of attracting new business. However, in many cases their efforts could be a great deal more productive if included as an integral part of their business development plan rather than simply a series of unrelated exercises carried out on an ad hoc basis.
A vital factor for success in marketing is to find out what your organisation is good at and then concentrate the marketing effort on where it will be most productive. The key questions that need to be answered are:
- Why do clients use us?
- What is the firm’s market
– and how do we know?
- What does our ideal client look like?
- How have we helped clients in different service lines?
The process begins with an in-depth examination of the existing client base, starting with the firm’s most successful clients and determining how the firm has contributed to their success. This, in turn, will highlight those areas of expertise within the firm that are ripe for development.
Additionally, firms need to look ahead in terms of what services their clients will require in the future and what potential exists for developing and promoting additional services. Before making any decisions or taking any action at all a considerable amount of research needs to be undertaken. The initial process should:
- Rank services by the most profitable
- Segment clients by type, profit and service
- Identify more of the same
- Devise a strategy to reach those targeted potential clients
- Review the marketplace and the competition
- Put in place a review system to monitor the above on a regular basis.
Unfortunately many practices do not organise their internal systems to produce this information and reveal the financial performance and profitability of individual service lines. Nor do they undertake any form of gap analysis of their clients; looking at the services available and which clients are using them. Therefore, they cannot identify clients who are not using services that could be appropriate for them. Again, the analysis should start with the firm’s larger clients and the results should show exactly what they are currently buying and what potential exists to offer additional services. The marketing strategy should be geared to deliver the type of clients that have already been identified as desirable, using a mix of the marketing tools available. These include advertising, direct marketing, public relations (PR), personal contact (networking), sales promotion, website or corporate literature and can be used individually or in any group combination to create an integrated approach.
But of course it is not only new clients who should be the targets of a marketing campaign.
CLIENT RELATIONSHIP
Part of the marketing effort – and budget – should be spent in maintaining healthy relationships with existing clients. Some firms have a substantial client entertainment budget; others make do with ensuring that partners keep in regular contact with their most important clients, but whatever the client relations strategy, the aim should be to ensure that they feel wanted and valued by the firm.
A good level of communication between personnel at all levels is therefore vital in order to encourage everyone - from the receptionist to the senior partner - to see themselves as ‘ambassadors’ for the firm and act accordingly.
Existing clients are also a prime source of new business referrals, but all too often there is no formal procedure in place to ensure that they are encouraged to refer work to the firm. Where a good client relationship strategy is in place there should be no problem in asking for – and receiving – referrals.
TARGETING THE IDEAL CLIENT AND IDENTIFYING UNDESIRABLES
Before launching a wide-ranging marketing campaign it is advisable to determine the type of client that the firm wishes to attract – the ideal client - and just as importantly, the type of client that would be undesirable because they could not be serviced profitably.
A ‘wish list’ can be drawn up for each of the firm’s service lines. For example, with assurance services it might include:
- Does not want any hassle from the authorities
- Keeps good, simple records from which to prepare accounts/returns etc.
- Provides information on a timely basis
- Right size of business (minimum fee, minimum net profit)
- In a stable or expanding business sector
- Able and willing to pay fees on time
- With potential for growth and purchasing other services from the firm
- Sees the firm as their natural business and financial advisor
- Geographical location
Where the firm already has expertise in certain industry or professional sectors there is an obvious target market and this should form a major part of the marketing strategy. The focus should always be on quality rather than quantity. A few high value clients can have a far greater impact on the firm’s profit levels than large numbers of small clients producing a high volume of work but low profit margins.
With such a variety of tools to choose from it is worth taking a brief look at some of the individual marketing methods and how they can be utilised to maximum effect. Like it or not it is a fact that the entire business community is becoming increasingly reliant on the internet, not only as a source of information but as a business tool. Unfortunately there is a section of the profession that still refuses to acknowledge the need for an electronic profile, but as well as helping to bring new business into the practice, a website can also provide a whole range of useful information and services to existing clients, thus helping to promote good relationships and client loyalty.
DIRECT MARKETING
Often referred to as the rifle rather than the shotgun approach, direct marketing is about narrow and efficient targeting. With the development of database technology and management, precision targeting of potential clients can be achieved using a whole range of parameters. Some firms create and maintain their own databases of potential clients, but for smaller practices without the necessary resources there are numerous companies that supply business listing for purchase or rental.
And don’t forget the many advantages of email. This is both the fastest and cheapest way of maintaining regular communication with existing clients or contacts. Every practice should have an email database and use it for reminding clients of important dates and disseminating a wide variety of information.
PUBLIC RELATIONS
PR is about building and sustaining positive relationships with those people who have an actual or potential impact on the firm’s ability to achieve its objectives. They include suppliers, employees, financial institutions, other potential sources of business referrals and clients – both existing and prospective.
Effective press PR requires a combination of good media management in targeting the most appropriate publications and establishing good relationships with editorial staff. Quite often a regional newspaper will be more interested in taking a regular or occasional column on business advice from a local independent firm than the local satellite office of a national practice.
There are many different types of promotional event from corporate hospitality at sporting or cultural events to technical seminars and public speaking engagements. All are designed to offer goodwill, introduce the firm, its partners and staff to its publics and generally to raise the firm’s profile in the local business community.
NETWORKING
As we have already seen, personal contact is vital in creating and maintaining a good relationship with existing clients and maximising the opportunities to generate both additional work and new client referrals. However, it is also important to create good relationships with intermediaries such as banks, solicitors and other professional people who may be in a position to refer new clients. As people are more inclined to refer business to people they know on a personal level it is worth devoting some time to cultivating these relationships.
CONCLUSION
Marketing a professional accountancy practice is not rocket science; armed with the right information, a clear idea of where the partners want the business to go and a strategy based on a factual assessment of the business, its strengths, weaknesses, opportunities and threats, any practice can create a successful marketing strategy