How to grow your accounting firm up to 10X faster
While the web has been around for over two decades, its use as an effective marketing tool has matured in just the past few years. As a result, marketing in the accounting profession is undergoing a revolution, fundamentally changing how accounting firms promote themselves and develop new business.
Traditional marketing channels such as print advertising and sponsorships are quickly losing their impact. According to the 2019 Marketing Budget Benchmark Study, conducted by the Hinge Research Institute and the Association for Accounting Marketing, more than 60 percent of accounting firm marketers advocate increased spending on web-based opportunities such as search engine optimization, social media and online video.
Today, I’d like to take you on a quick tour of some of this study’s key insights. This year’s study examined the marketing budgets of 100 accounting firms, with a combined $3 billion in annual revenues. The participating firms were studied as two groups: the overall accounting firm population, and high-growth firms — those that grew at a significantly higher rate than their peers.
Overall, today’s accounting firms spend a substantial portion of their marketing budgets on traditional channels, such as sponsorships, association memberships, networking events and conferences, charitable giving and advertising. As a percentage of their revenue, small firms spent an average of approximately 30 percent more on marketing than their larger compatriots. And almost a third of all marketing budgets was spent on marketing department compensation.
How high-growth firms grew nearly 10X faster
What sets high-growth accounting firms apart from their lower-performing peers is their willingness to take a different approach to marketing. For the most part, they have tossed the traditional marketing playbook out the window and chosen to spend more on digital marketing — nearly 42 percent more than low-growth firms.
What do they do differently? High-growth practices focus more on educating their target audiences — addressing issues that affect their audiences and creating a stream of valuable content these people can find and access when they need it. In fact, high-growth firms spend a remarkable six times more on educational activities, including in-person events and webinars, than lower-performing firms. As a result, high-growth accounting firms grew nearly 10 times faster than their low-growth counterparts, generating almost $1 million more in revenue per equity partner.
Where do low-growth firms allocate most of their budgets? Primarily to discretionary partner funds, firm events and parties. They also spend significantly less on their marketing departments. High-growth firms have nearly twice as many marketing personnel as low-growth firms.
As more and more accounting firms turn to digital marketing, sophisticated tools such as marketing automation are growing in popularity, making it easier to automate and scale many marketing tasks such as email campaigns, information request fulfillment and personalized engagement. Websites are being optimized to improve lead generation, engaging prospects higher in the marketing funnel and converting them into new business.
If your accounting practice is still firmly rooted in the past, now is the time to start incorporating digital marketing into your mix. While it’s probably still too early to abandon all traditional marketing channels, you can significantly improve your firm’s prospects for growth by taking advantage of digital marketing opportunities and engaging with potential clients who are now using the web as a primary research tool to find new business partners and service providers.
Interested in learning more? Download the 2019 study from the AAM website.