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May 27, 2019

Marketing Matters: Best Practices for Small CPA Firms

Effective marketing is a plus for all firms, but it can be especially vital for small practitioners. From online reputation management, to engaging websites, to leveraging your local listings, Hugh Duffy of Build Your Firm Inc. walks us through what small CPA firms can do to optimize their marketing efforts and help the business thrive.

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By: Bill Hayes, Pennsylvania CPA Journal Managing Editor

Podcast Transcript

Effective marketing is a plus for all firms, but for small firms, it can be the difference between a thriving business and an early shuttering of the doors and windows. To talk to us today about how small CPA firms can use marketing strategy to bolster their business, we're with Hugh Duffy, chief marketing officer for Build Your Firm Inc.

How important would you say effective marketing is to the survival of small accounting firms at this point?

[Duffy] I'd say it's very important. I'm not going to say it's critical to their survival because you could be an ineffective marketer and still survive, given the business model for accounting firms and the role that they play as a trusted advisor and helping business owners and individuals with their tax issues, their accounting issues, and other types of related matters. What I'd say is that if your goal is to be successful, thriving, and basically to be a superior firm, being an effective marketer is critical for rapid growth, it drives the ability for you to acquire superior clients – not just average clients – operating your practice at higher profit margins and higher hourly realization rates, being able to or putting you in a position to hire and retain superior quality staff, and then running the practice more like a business and running it in a fashion so it's less dependent on how hard the owner has to operate and run the practice.

The way we reach is we're trying to get you to run it like a business, and you oversee it and manage it, not do all the work. It depends on your goals, but if your goal is to be a superior practice, it is critical. It's a large part of running a successful business in any type of industry.

What are some of the reasons small accounting firms give for not marketing? Why are those excuses not sufficient?

[Duffy] It's interesting. Most would tell me that it's not something that they're comfortable with, they're not good at it. Some would say that they were never taught, working for another firm, they were never taught in school how to effectively use marketing to generate leads. Some would say that they've taken some do-it-yourself marketing programs and they didn't work. Some feel that they could sell effectively based on the referrals they've received.

I typically tell them that that's really not a good benchmark to measure your ability with which to close leads, but to a large degree, a lot of them feel that they generate enough leads off of referrals if they work hard and they do a good job for their existing clients, but I would say that they need to do more than just rely on their existing clients, particularly in earlier parts of their accounting practice. They need to use other vehicles to generate leads and have more control over their long-term success.

In terms of why it's not sufficient to use some of those reasons as a crutch, I would say that every business, every business, the business owner needs to take ownership and responsibility for marketing and selling their business. It doesn't matter if somebody's an accountant, a doctor, a lawyer, a restaurant owner, an engineer, an architect, you name it.

The owner in any small business is dependent upon the owner's ability with which to drive and lead the organization. Ultimately, why it's not sufficient to accept those excuses for not understanding marketing, it's critical to making a living, providing for your family, making more money than your peers, and developing a practice that's really easy to sell and ultimately worth more when you decide to sell it at some point in time down the road. Really, it comes down to control and driving your own bus and having more control over your future and your destiny.

Let's talk about some of the ways by which small firms can market. How can they leverage local listings?

[Duffy] Local listings is a process. Some of it is menial. Some, it's using a syndicated service. The way that, if I was coaching somebody, I would instruct them is, I tell them to manually set up their Google My Business account, manually set up a Yelp business account, a Facebook account, and a LinkedIn account for their business. Then what they do is go down the road of using a third-party syndicator called Moz Local. You just type it into Google. They have a local listing service that costs just $99 a year.

What they do is they reach out a little bit deeper on the Internet into Yellow Pages, into business organization's directory services, Manta, you name it. There's hundreds of smaller directors and websites. They would list your firm for somebody that is searching for a business such as yours and for $99 a year. It does that as a syndicated service and it pushes it out to the smaller resources out there on the Internet. That's how you go about doing a local listings process.

What sort of role can firms play in the area of reputation management, what's being said about them online?

[Duffy] Just like any other business, I would encourage them to take an active role in setting up and obtaining online reviews. They have a little bit more control over their reputation on the internet, whether it's in Google, whether or not it's in Yelp, or some other review service. It starts from a grassroots level. What you're going to want to do is encourage some of, it could be your, if you're starting out, initial clients, it could be your family members, and encourage them to post a review, at least to get the process started.

Then, as the ball starts to role for a practitioner, you're going to want to identify at the right times of the year when a client is thrilled with your service. That should be a cue at that moment to ask that happy client, would they be willing to share their experience in working with your accounting firm by providing an online review, whether it's in Google, whether or not it's in Yelp, whether or not it's in another online review service. Could be in Facebook, you name it, but you always want to keep your ear to the wall when that moment arises and at that moment, it could be in a year-end tax-planning situation, it could be helping them out of a jam, it could be helping them set up their new business. There's a lot of different inflection points where a client is thrilled with a service that's being provided by the trusted accountant. That's the moment to ask for it. I would encourage any small accounting practice to take an active role in controlling their own destiny in their online reviews.

There's a couple other tips I'll just throw in there. At some point in time, there's going to be a bad review in everyone's life. You can't make everybody happy. I would encourage you, if that moment happens to your practice, at some point, after you've already gotten a couple positive or glowing reviews, is that you take that discussion offline. You don't continue that discussion on the internet. You don't want to have negative things being said back and forth and leaving a history and a trail there.

What you're going to want to do, just like any discussion with a disgruntled employee or family member, you're going to either want to have that conversation on the phone or you're going to want to have that conversation in person to try to understand the person's position. You're going to want to, regardless of whether you agree or disagree, you're going to want to take ownership of the problem. You're going to want to show some empathy with their situation and do everything you can either to address their issue or help them going forward in making the transition to identify a provider that best suits their needs.

What you don't want to do is flame the situation. Then immediately, when that discussion's over, now you want to get back to the process of what I'm going to call suppressing a bad review. The way you would do that is you're going to want to get positive or glowing reviews after that point in time to push that bad review further down. It's almost like a Craigslist posting. You're going to want to push it down onto the second page so it's going to be less likely to be seen and read, and you're going to want to have, say, 10 reviews, glowing reviews above it so the impact of that negative review really doesn't have as much of an impact on your practice going forward.

As far as front-facing tools that each firm has for consumers, there's always the firm website. What role can a firm's website play in the marketing of a small business?

[Duffy] For any business, a website's vital to putting your best foot forward, giving you a little bit more opportunity to demonstrate your qualifications, how your practice might be unique, who you can best service – is it a particular type of small business, is it a particular individual – basically, create the right first impression. The analogy I would give people is it's almost like the impression you create with that new prospect that doesn't know you, has never talked to you. You give them a better first impression than if they walked in the front door of your accounting practice.

A well-organized, well-constructed website should be able to deliver a positive return on investment. It doesn't take much. Typically, a website's going to cost you a little bit less than $1,500 for the whole first year. All it takes is picking up one new business client, and it pays back. For most of our clients that we work with, they're actually making money on the website. It's not really an investment. It's a given, and it's a fundamental piece of operating their business. It can pull in leads and pull in clients that you would never meet in person.

What are your thoughts on email marketing and how it can best be used? Are there any best practices in terms of what you should share or how frequently you should contact people?

[Duffy] That's a great question because we typically don't advocate that small accounting firms use email for the reasons you mentioned. It has been overused. People do get too much email. People do typically try to identify, "Do I know this firm? Am I familiar with this particular person?" If they're not familiar and if it looks like it's coming in from right field, they're going to be much more skeptical. It's going to be much harder to start to develop a relationship and a dialogue.

For most of the firms we worked with, they generally are not using email marketing as a broadcast marketing medium to create familiarity with a firm. It works for people that you know that you've met at some point at time, have considered your firm services and expressed interest in some capacity, adding them to your email newsletter is a possibility, but we typically, not doing it for one-to-one but for broadcast marketing efforts, we don't recommend it. It's not something that most accounting firms would do well and, if anything, it can be detrimental.

How much staffing or how much manpower does it take to fulfill a marketing plan such as what we're talking about here for a small firm? If it's streamlined, is it reasonable for a small firm to achieve?

[Duffy] It is. The biggest thing is to learn what you need to do to basically fit the type of practice the person wants to build, and everybody's practice is different. If it's not, your goal should be to try to make it different so that they move down the path of being in the advisory services-type practice. We work with hundreds and hundreds, over a thousand firms actually, and all of the firms we work with do not have dedicated staff. They're too small to have in-house marketing people. Their money can be better deployed by hiring staff members, investing in technology to operate a superior practice.

Once you learn how, and the path, and the type of practice you want to develop, it's probably easier to outsource a good portion of the marketing, and I say by outsource, it's not a big financial expense. We talked about the online marketing, the website marketing, some of the things you would do around that particular effort. That is not a big expense, and I've already defined that to be less than 1,500 bucks.

The thing that would consume time would be some of the content marketing stuff, whether or not you have a blog, whether or not you're writing an article and posting it on a regular basis to support your website, whether or not you're writing an occasional article that would be published. In that particular case, some people use a hybrid approach. In some cases, they'll hire somebody. Could be a family member. Could be someone younger, or they outsource some of the social media marketing posting that's being done, but, again, that's really not consuming a lot of the practitioner's time. The majority of the time is meeting with prospective clients and determining whether or not they're a good fit for their firm in the near-term and long-term. That's really where the time is invested. That's not really something you can outsource anyhow.

We've got firms growing $50,000, $100,000, $200,000 a year, and they don't have dedicated staff so it can be done in a smaller firm. I think it should be set up to be done that way, and then ultimately, when they're more established and larger at a point later in their career, they can identify whether or not they want to bring it in house or continue to outsource it.

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Podcast transcripts are provided as a summary of the conversation and have been lightly edited for the written medium. The transcript is not a verbatim representation of the interview.
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