It’s safe to say that the accounting industry significantly undervalues the power of marketing, as many firms forgo putting resources toward effectively marketing their services to potential clients. In fact, according to the 2018 CAS Benchmark Survey, firms within the accounting industry spend under 1% of their revenue on marketing efforts.
In comparison, at Summit CPA, we spend approximately 7% of our revenue dollars on marketing. We believe this percentage impacts our bottom line, as our closing ratio in 2019 and 2020 was more than 10% higher than the industry average of 19%. We also consistently land clients that bring in $50,000 more than the industry average of $15,530.
In short, marketing matters. Contributing more money toward effective and consistent marketing techniques can net you more clients who will bring in more revenue. However, before you start throwing cash toward your sales and marketing team, we recommend laying the groundwork to help ensure their success. Our marketing efforts at Summit CPA have been successful because we found our niche, determined our market verticals, and tried to grow within those select spaces. The idea is to be as efficient as you can with your marketing dollars by identifying areas of the market where your firm has ample room to grow.
Why You Should Select a Niche
When you pick a niche for your firm to operate within, you are selecting a market that your team is knowledgeable and passionate about serving. We recommend choosing a niche that contains clientele whose needs you are familiar with and can ultimately help satisfy. Consider the services your firm is already providing successfully and to which parties, then determine if there are more clients like the ones you are already servicing out there and whether you can scale your current services to assist them. If there is room for growth, you’ve found your niche and can begin marketing directly to it.
For smaller accounting firms, choosing a niche can help distinguish your firm as the one to hire when compared to much more prominent firms. Your target clientele is more likely to select you because those more well-known firms are not marketing directly to companies operating within your niche and, therefore, may not have the perceived knowledge your team possesses.
Examples of Lucrative Verticals
At Summit CPA, we elected to take an advisory approach to accounting services because we saw that this was not an approach taken by most accounting firms and that our clients would benefit greatly from it. With that in mind, our niche products mainly revolve around virtual CFO services, which we’ve offered since 2004. We currently provide virtual CFO services to more than 100 clients who each bring in approximately $60,000 in revenue. We also began offering 401k audits in 2011 after recognizing that few firms were doing these audits and that there was an opportunity to grow our client base with this service. We’ve since increased the number of 401k audits we conduct annually from 10 to 200 using effective marketing methods.
Our firm also markets our services to specific businesses, including creative agencies and companies operating in the cannabis, logistics, and e-commerce industries. While we recommend looking at sectors where there are opportunities for your firm to grow, then marketing your services to those entities, we must confess that we identified our market vertical with creative agencies by happenstance after an agency reached out to us for assistance in 2011. Since then, we have put more effort into marketing to these verticals directly and went from landing 4 to 5 creative agencies annually to closing 2 to 6 per month.
You can quickly grow your product sales and client base when you determine your niche and target the right market verticals. Put simply: decide to invest some time and money into marketing your services to your target demographic and watch your bottom line grow.
At Summit CPA our marketing efforts have been successful because we found our niche, determined our market verticals, and tried to grow within those select spaces. The idea is to be as efficient as you can with your marketing dollars by identifying areas of the market where your firm has ample room to grow. For more information, contact our office at 866-497-9761 to schedule a consultation today!