August Aquila began his career as an accounting firm marketer before the term was popular -- as a freshly-minted MBA from DePaul University. Over the past 20 years, he has blazed new business development trails throughout the profession - becoming the first director of new business development at Coopers & Lybrand and the first non-CPA marketing director to make partner (at Friedman, Eisenstein, Raemer & Schwartz in 1985). He was also partly responsible for the accounting firm consolidation craze of the late 1990s, in his position as head of mergers and acquisitions at American Express Tax and Business Services' division.
After a 10-year stint at Amex, Aquila struck out on his own this summer, and is currently heading the consulting division of The Growth Partnership - a professional service firms consultancy. He also edits Partner Advantage Advisory, a monthly newsletter for CPAs, put out by Hudson Sawyer.
WebCPA editor Tracey Miller-Segarra probed Aquila about the role of marketing and business development in the profession over the past couple of decades, and his part in it, during a recent interview.
How is marketing for public accounting firms different from other businesses?
The most pronounced is that with a product you can advertise (for example zero % financing) and drive buyers to your showroom.
With professional services, you can advertise a discount on divorces and not necessarily get more people to divorce.
The best marketing can do is to keep the firm’s name in front of its market segments so that when the occasion arises, the client may think of you and your firm.
Second, marketing and sales are highly dependent on the professional to close the transaction. When a client buys a product, they are merely buying the product and what it represents When a client buys a service, they are really buying the professional who will produce and deliver the service.
How is it the same?
Marketing a service and a product are the same in the sense that every business needs to have a value proposition that is offered to its clients.
The value proposition is equal to the service (or product) attributes plus the firm’s image and reputation plus the experience the client has with the firm. Even buying something over the Internet includes an experience. If a client finds the Website hard to maneuver, he or she will not return. If the waitress is not friendly or attentive the family may not go back to the restaurant. If the consultant is not responsive or there is little or no chemistry between the client and the consultant, the client will go elsewhere.
What qualities does a firm, or firm leaders, need to have in order to successfully grow their business?
Firm leaders need to have a clear vision of what they want for themselves and for the firm. Leadership is about getting a group of people who want to go in different directions, moving in the same direction, and it’s about getting people to do more than they ever thought they could do.
It’s important for leaders to clearly define what their value proposition is. Think of Disney’s – it’s to make families feel good. Hence their products – the theme parks, movies, cartoons, characters, etc, plus their image, plus the experience families have, all support the company’s value proposition.
You joined Coopers & Lybrand in 1979 as its first director of new business development. What had you been doing before then, and why did this challenge at Coopers intrigue you?
Prior to joining C&L, I was working on an MBA in Marketing and Management at DEPAUL University (Chicago) and working as the Associate Director of Development for the University. DEPAUL was developing its Accounting School that was one of the best in the city. Seven of the eight managing partners at the Big 8 firms in Chicago were DEPAUL Alumni. I assisted the Business School in developing funding for the new program and met many of the business leaders in the community.
Ernie Wish, who was the Group Managing Partner at C&L, was also a DEPAUL trustee. We developed a good friendship, which has lasted until today, and he asked me if I would like to join the firm as the associate director of new business development for the Chicago office. This was in 1979 and I believe I was the first field level marketing person in that position.
When I completed the MBA, I had two job offers, the one from C&L and one to work in South American. My wife wanted to go to law school, so we decided to stay in Chicago – so much for career planning.
You were at the forefront of the accounting firm consolidation movement. What excited you about this opportunity? Describe its high and low points from your perspective.
I realized early on that this would be a once in a lifetime opportunity to be part of something really different. Whether it worked or not did not matter to me. I felt that the experience would be unique and would never come again.
What really excited me most was the potential of being able to help change an entire profession.
I think the high point was when we were finally able to acquire one of the Group B Firms. We acquired Checkers, Simon and Rosner in Chicago. After that we were able to acquire several other Group B firms.
I think what hurt us most was the frequent turnover in CEOs at Tax and Business Services. This held us back in executing the core strategy as quickly as we wanted to.
Do you think consolidation (at TBS, H&R Block, CBIZ and others) was a success? Why or why not?
Each consolidator approached the market in a somewhat different manner. So far all have been successful since none of the firms has gone out of business. It may be too early to know for sure if this model will ultimately work. Consolidators have a lot to offer to CPAs who are comfortable working in a non-partnership entity. Employees in this model can develop wealth outside of the partnership and when they are ready to retire, they do not have to worry about who will pay for their retirement.
Why did you leave American Express?
After 10 years it just felt like the time was right start a new chapter in my life. I had accomplished and experienced what I set out to do. In fact, I have learned many new things over this time that I can now use when consulting with firms. I really wanted to get back to having client contact and the satisfaction that comes from working one-on-one with a firm.
Do you think most accounting firms "get it" about integrating marketing into their strategic planning, or do they still have a long way to go?
I don’t think that most accounting firms have integrated marketing into their strategic thinking. They still look at marketing as separate from the core practice. Firms are not looking at marketing as being part of their overall value chain.
Market identification and innovation (R&D) is really the first step in a value chain. If marketing does not identify the right clients for the firm, and if the firm does not have the processes in place to produce and deliver the service, then the firm will not be as profitable as it could be.
What role can consultants play in helping accounting firms grow and stay competitive?
Consultants bring a wealth of knowledge from working with other firms or even from working in other industries. The most important thing a consultant can do for his/her client is to help them implement what they talk about.
I’ve seem too many consultants say things without having any supporting work papers to substantiate their claims, especially when it comes to mergers and acquisitions. Consultants need to base their suggestions on solid information and good financial analysis.
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