Preparers are exploring many online tools to e-market, and on the heels of familiar avenues such as Facebook, Twitter and LinkedIn have come newcomers such as Yelp and Thumbtack.
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Yelp is a site where consumers go to read and write reviews about their favorite local businesses, such as tax prep firms, while on Thumbtack, vendors such as tax preparers pay a nominal fee to offer their services, in most cases surveyed about $8 per lead.
A recent Yelp search in Manhattan yielded almost 200 tax prep services reviewed by clients; a Thumbtack search for one Manhattan ZIP Code revealed nearly 100 tax prep services.
Reviews on such sites, of course, can range from ecstatic to damning, so how prepares approach and use such marketing sites is key.
Though such marketing might fly in the face of traditional marketing of tax prep, some preparers think it worth the effort. Others said that marketing on such sites can not only turn up no leads, but actually backfire.
Good and bad
“I have been very frustrated with Yelp and similar sites,” said Laura Strombom, EA, at All About Numbers in Stockton, Calif. “One client … came to us to amend a return, which we did. Per the amendment, she should receive a $1,000 refund of the $2,500 previously paid. However, it turned out the original return she brought us, stating it had been filed, was never filed. Instead of getting a refund, she got a bill for $1,500. She proceeded to blast my firm on every Web site she could find, as well as file a complaint with the BBB.”
Yelp has this client’s negative review prominently posted, Strombom added, bringing up a major drawback to sites that practically cement clients’ negative reviews on their sites. “I’ve had clients read it and file counter, positive reviews. Yelp puts them in the filtered area. I began to look at other businesses I frequent in my area; I reviewed many businesses, realizing that if I want to have people review me, I should be reviewing others. I soon learned that all of my reviews were listed as filtered. I looked at some Yelp pages of some of my clients. They also had the good reviews as filtered, but negative reviews were displayed.”
“We’re listed on Yelp [but] it hasn’t provided anything to call home about,” added Jeffrey Schneider, an EA in Royal Palm Beach, Fla., and member of the National Association of Tax Professionals. “Every time we ask a new client where they found us (if via the Internet), they say Google or an Internet search.”
EA Steven Potts of Potts’ Taxes, in Fullerton, Calif., and a member of the National Association of Tax Professionals, said that he has used Thumbtack.com successfully recently. “Thumbtack provided me numerous leads, although I find the format for submitting quotes a little difficult with such limited information. I was able to pick up two new clients directly from Thumbtack and at least one referral from a client picked up from Thumbtack. For the amount of time, effort and money put in, Thumbtack was an interesting alternative,” he said.
Some preparers, however, have also found this a blind marketing alley. “I was a member of Thumbtack,” said John Stancil, CPA, of My Bald CPA in Lakeland, Fla., and also a member of the NATP. “I found that, in most cases, the information provided was insufficient to make an informed bid. To avoid getting trapped doing a complex return for minimal dollars, I’d couch my bid in qualifiers, specifying that there would be additional charges for additional forms. In addition, it was my perception that people were trying to get a return done on the cheap. While I’m not the most expensive preparer around, I do expect a reasonable return for my time.”
“Third,” he added, “I found Thumbtack difficult to deal with at times. If the person requesting the quote responded to me, I could not get a refund even if they didn’t accept my bid. In short, Thumbtack was too much hassle for too little return.”
Other preparers, writing on LinkedIn preparers’ groups, have had different experiences (though wondering if Thumbtack clients were a “cheap crowd”).
One preparer, for example, reported that he “spent about $18 or so on bids and did over $800 worth of business and have an ongoing bookkeeping client as a result … It doesn't generate a ton of leads, so don't depend on it as a total source, but definitely add it to your package of advertising.”
Frank Hagan, CEO of Acumen Consulting, said on a preparers’ discussion group that he used Thumbtack several times last season, and secured two clients. “I found Thumbtack during a search for a local electrician,” he wrote, adding that the bidding process for such professionals as preparers isn’t always clear on sites like Thumbtack. “You can see the first name, city, and a brief description of the person’s needs,” he wrote. “I paid $6 to quote on [one ad] and did land the client. Overall, I spent about $35 on quotes through Thumbtack; $17.50 per client is not a bad customer acquisition cost.”
Thumbtack has “a nice profile section where you can add a lot of content,” Hagan added, “but that content is hard to find because they want consumers to submit requests for quotes. The second client actually found my Thumbtack profile linked from another site, and so I got that client without paying to quote.”
“This is less valuable than a listing on Yelp or Angie's List (both of which are also free),” Hagan wrote. “I do have to say that the clients I picked up were good quality, and not just bargain-hunters. “
“My two customers weren't cheap, but then I quoted them less than they were paying at H&R Block. One was tired of having a different tax guy or gal every season. The other was quoted $300 for pretty simple return that I do for $200,” he wrote.
Tips and tricks
Clients acquired through these avenues do tend to be unusually price-sensitive and not especially loyal year to year, some preparers said. Other preparers have secured clients on these marketing sites with precise marketing wording.
One example: “I would appreciate doing your income taxes. I work with people on the price I charge. I have never had price as an issue. My prices generally run between $75 to $150 … I have done taxes for eight years. I am an IRS Registered Tax Preparer …”
“I tend to try and put too much information into the quote, and the two that I landed were ones where I just averaged my rates and kept it short and simple,” Hagan wrote, adding that he uses such marketing avenues primarily “to build a client list.”