Marketing AccountingEssay Preview: Marketing AccountingReport this essayIn this paper I will be discussing the link between marketing and accounting as I am a marketing/accounting major. There are many connections between the accounting business and marketing. The marketing business is something that should not be overseen and many times is more helpful and detrimental to a business.
It is absolutely true that all businesses, including professional service firms, need to distinguish themselves in their marketplace. This is accomplished by creating a compelling message that differentiates the firm from its competitors. Imagine this scenario: You could close an additional $275,000 in revenue in just one day. And on that same day, you could identify over $500,000 worth of additional revenue opportunities. It might take a little planning and some hard work, but its possible. In fact, Clark Haley, president of San Antonio-based Business Computer Systems, did just that by holding the companys annual user conference. Although Haley feels that all marketing efforts have some value, “the event that is the most measurably effective is the user conference.” Each client conference costs about $10,000 and demands more than 200 plus man-hours for developing content and planning. However, the firm closes $150,000 in new business from each one. (Caragher)
Public accounting firms that want to advance to the next level, becoming and remaining profitable, are adopting many of the proven concepts that have worked so well in corporate America. This includes recognizing and embracing the importance of structured, integrated marketing efforts.
Marketing is critical to the success of every business. Unfortunately, many businesses discount the effect it can have, and they forego their marketing efforts for other activities. Or they make one or more of these mistakes, and their marketing efforts become ineffective. Perhaps this is why nine out of 10 businesses end in failure.
Effectively communicating the firms distinctive capabilities, its special skills and hard-to-duplicate expertise, is one of the key roles that accounting marketers play today. In a world of intangibles, marketing can take the firm further than ever before, helping contribute to the firms growth by reinforcing the brand, position, and image that separates it from the competition. Marketing accomplishes this by creating and implementing a balanced strategy that integrates a variety of tactics like, research capabilities, planning/execution, and working together. Preliminary market research enables todays firms to make informed decisions, helping them assess obstacles, challenges, and opportunities as well as analyzing the firms personality and culture, goals, strengths, and weaknesses while reviewing the available resources and skills.
The marketer cannot succeed if working alone. Rather, success is best accomplished when everyone in the firm works together to reinforce the firms unique selling proposition. Linking marketing to profitability? At times it does sound like a magic trick. If you understand the elements that make up profitability and evaluate how marketing can influence each, it becomes easier to see the direct relationship between the two. Once this connection is understood, you can effectively implement marketing activities that will positively drive the profitability of your firm. According to industry reports, estimated billings for accountants providing payroll services to small business clients can range from $480 to $1,700 per client per year. If you are willing to invest a small amount of time and money into understanding payroll and how to market it as a service to clients, your annual profits could increase exponentially.
There are four basic concepts that drive profitability in a CPA firm: (Mostad)* Chargeable Hours* Realization Rates* Effective Use of Non-Chargeable Time* Cost ControlClearly, the more business you bring in through marketing activities, the more chargeable hours you will have. (Mostad) Having a solid growth plan for future new business also makes it easier to cull unprofitable clients. Every CPA firm has a certain amount of time they know their staff and partners will not be able to charge to clients. But that doesnt mean non-chargeable time has to be unprofitable. If that time is focused on activities such as business development, new product development, or staff development, in the long run it will be profitable. The second way marketing contributes to better use of non-chargeable time is by making the most of proposals. Following a strategic marketing plan helps your firm avoid ad hoc, unfocused, individual marketing activity that wastes both time and money. It will save costs overall if you follow an integrated marketing plan concentrated on the right target market.
Marketing director Maggy MacPherson, of regional CPA firm Beard Miller Co. LLP, in Pennsylvania and New Jersey, recognized what few firms like to admit – her firms Web site needs a lot of work. “The site is not very user-friendly right now,” said MacPherson, who is leading the redesign of a new site that at press time was scheduled for an October 1 launch. “Well have a stronger message about the firm, our philosophy, and a new look and feel. It will be graphically interesting, but still simple and easy to use.”
MacPherson said that the firm updated information in past years to the Web site, but never redesigned the portal, making it hard to locate information and therefore not as helpful to existing or prospective clients as it needed to be.
Web sites are one of the farthest-reaching marketing tools for CPAs today, and cant be thought of as an added feature any longer, said Tracey Segarra, marketing director for New York City-based Citrin Cooperman & Co. LLP. Without having an online presence, or with an outdated Web site, firms are seen as unprofessional and antiquated. The cost of building and maintaining a Web site is well worth the reward, and does not necessarily mean spending thousands of dollars if the firm finds the right designer. Web sites as marketing tools is not a new concept, but there are still a number of CPA firms that have outdated or unprofessional Web sites, or none at all, said Greg Pearson, president of Williams Web in Chattanooga, Tenn., a Web designer. Added features
Pilot
New York City-based F-Barting said it is taking a look at a pilot program that combines “an existing website for marketing, advertising, and financial services and a newer model, called a marketer tool.” The website that makes the “marketer tool” “has its very main purpose,” said F-Barting CEO Peter Neeley. By using “traditional, proprietary technologies” the site can offer both a high-quality and high-value market and offer the CPA firm “a competitive cost advantage” over other websites. In addition the CPA firm provides “a business value” for their business with the “marketer tool,” as well as the CPA firm’s CPA’s own website. The website has an integrated website design and is therefore not a marketing tool, but rather a free application for a website’s web user base. In the first model of the pilot, only a small amount of the CPA firm’s website was made available online; in the second model, all of the website’s information was made available through a proprietary browser, which is currently maintained by CPA firms at their companies’ websites. “These are two really different things; one is about managing small, online customers and the marketing, the other is about designing websites that will appeal to them on an online level,” Neeley told me. In the pilot, only a small percentage of the CPA firms’ website material was offered online. In fact, many of the websites the CPA firms created could barely be viewed on CPA websites (even though their logos were used with commercial web apps) and many of the websites did not have the right technology. “We’re always looking to make people better,” said Neeley. “So, this is a very early version – it’s not a complete pilot yet, but I think we can start seeing more people and more CPA firms using services to create their own websites and develop their own businesses like that.” The CPA firm has built out a network of offices in Tennessee that have the technology to manage the online marketing market. It is working with F-Barting, an independent marketing and education firm with offices in Chicago, Washington, D.C., and Indianapolis, to “generate unique content for our clients around the world on the websites they create and then develop for us.” According to the CPA firm’s latest fiscal first quarter financial reports, the company recorded $2.4 billion in revenues, 684 K-12 spending, 782 K-12 enrollment, 13,852 K-12 student enrollment, and 2,081 annual operating income. F-Barting said this is more than 3 times the share of the CPA firm’s total revenue revenue in fiscal 2008, and it may have been “inadequate” because people could not find online resources. However, as the size of its site increase, new information that was provided