Next month I’ll be presenting on the topic of How the Fastest Growing CPA Firms Spend their Marketing Dollars at the MSCPA’s Practice Management conference. If you’re a CPA, I’ll hope you attend!
While the research this article (and presentation) is based on is from CPA firms, I believe the basic principles are true for all of professional services firms, so everyone, please, read on!
Consider this: High growth and low growth firms spent nearly the same amount on marketing. The difference is in the budget allocation.
WOW! That’s great news! You don’t have to “buy” you way to growth.
If you’ve visited my website you’ll have seen that I present marketing on a sliding scale from Awareness Driving to Revenue Generating. It’s important to have marketing activities across the board. But low growth firms spent more than half of their budgets on the activities that I would deem Awareness Driving whereas high growth firms spent less than 20% in this area.
Awareness Generating Activities
Some Awareness Generating activities are easier to execute but they often cost more money – think of sponsorships or advertising. But these activities are often very expensive and produce results that are hard to measure and aren’t very likely to lead to new business. In my opinion this is where low growth firm are allocating too much of their marketing budgets.
But that’s not to say that you should ignore Awareness Generating activities – some are the most valuable (and most difficult). This would include the foundational work of defining and building a brand that is recognized in the marketplace and differentiated through specialization. Messaging and differentiation, logo and brand style, competitive analysis and niche development are all essential for the future success of firms today. Without a distinct and recognized brand you’ll have to work MUCH harder to be remembered in general, let alone when a referral opportunity comes along.
The good news is that you don’t have to do distinct brand development work every year – once a brand is established, the other marketing activities you do – across the Awareness to Revenue scale – will build on it.
Revenue Driving Activities
Included in the long list of Revenue Generating activities are niche building, tradeshows and conferences, presenting educational events. You can see why the essential work of brand building is so important for these initiatives to be successful. You can’t be the “unknown firm down the street” and expect to get any attention from visitors at a tradeshow. People will walk right by.
In my experience, firm partners aren’t as comfortable in the Revenue Generating marketing space. In addition, each activity requires more planning, effort, and guidance from a marketing professional than many Awareness Driving Activities. After all, sponsorships or advertising may be as easy as sending a logo or ad file with a check.
The middle of the sliding scale of marketing activities
Online Marketing includes your website, social media, email marketing, ebooks, and the Search Engine Optimization (SEO) and Search Engine Marketing (SEM) that we talked in recent blog posts. So much of online marketing requires content which is one more reason why specialization or niche differentiation is so important. If you don’t have these skills in-house, you can easily and affordably outsource much of this work. I would recommend that you focus more on developing your own blog posts and other content than buying it from a third party even if that means that there’s less of it.
Coaching & Development is all about focusing on the next generation. If you help your staff with networking skill building as early as their first year on the job then by the time they’re managers they’ll have an established network and be pitching new business. Firms don’t put enough focus on this but it’s essential to staff retention and even long-term firm succession.
I have so much more to say on this topic including my Top Ten Recommended Marketing Activities. If you want to learn more please attend my session at the MAP Conference or contact me and we can meet for lunch to continue the conversation.
* Statistics on firm spending is based on research from the Hinge Research Institute