small fish are sweet for accountants
Marketing is a bit like fishing, to be successful you need to prepare and have a clear plan as to the type of fish you are targeting. You can obviously target several species at once by setting up separate lines but without the right bait and tackle you are just hoping to get a bite. For accountants, hope is not an effective marketing strategy that hooks new clients.
So... What type of clients are you targeting?
We regularly ask accountants this question and too often they can’t describe their ‘ideal’ client. Some will paint a very sketchy picture but you need to be crystal clear. If you think the larger firms have a clearer vision of their ideal client, think again. We recently met with a large firm in Melbourne and they described their ideal client as medical professionals who pay $20000 a year in accounting fees. They indicated they may operate through a service trust, have multiple partners with multiple self-managed superannuation funds within the group and use the firm’s full range of services including financial planning, loans, finance etc. We asked them what sort of success rate they have in attracting that type of client and the consensus was they were fairly successful with a lot of ‘nodding’.
Our next question then stumped the partners; when was the last time they picked up one of these ‘ideal’ clients? The partners all stared at each other and couldn’t produce a name so I asked all three partners to undergo a simple exercise. On a blank piece of paper they were asked to list their top 6 fee paying clients. Next to their names we asked them to list how long each of them had been clients of the firm. The results were very interesting because it proved that they had not attracted one of their ideal clients for more than 4 years even though they thought their marketing was working beautifully. The truth is, their gross fees were almost flat lining and only 5 of their top 18 clients actually ticked the ‘ideal client’ boxes.
Here’s the icing on the cake. We asked the partners to detail the fees each of their top clients paid in their first year and the results were staggering. The vast majority of the clients paid between $2000 and $5000 in their first year and only 3 of them paid more than $12k and only one client paid more than $20k.
So, what did the partners learn from the exercise?
Firstly, communicate your successes with your staff and partners. They were all busy on the tools thinking the business was humming along but ‘busy’ doesn’t always translate to profit in accounting firms. They have now set up a T account on the whiteboard in the managing partner’s office that lists any new clients they win during the month and on the opposite side of the ledger they list any clients they have lost and why. They now wheel that whiteboard into every partners meeting and discuss the source of any new clients (referrals, website, staff, bank manager etc.) so they know what is working and what needs working on. You can’t measure what you don’t monitor.
Now that they know they aren’t winning their ideal clients we are re-writing some content on their website and looking at some SEO strategies including writing blogs. They are planning to run some seminars around topics that appeal to medical clients and looking to get in front of more medical graduates to position the firm as an industry expert. Social media strategies are now also on the radar and they are patient because $20k clients don’t grow on trees. Often these clients have been with their existing accountant for years so prying them away can be difficult so you need a strategic approach and the right ‘bait and tackle’.
The big lesson here is ‘small fish are sweet’. You can turn small clients into big clients if you nurture them and introduce your additional services. Cast your mind back, we all cut our teeth consulting with smaller clients and business start-ups. If you only roll out the red carpet for the larger new clients you might be snubbing your big clients of the future.
If you want to win more of your ideal type of client talk to us today about our marketing services for accountants or consider joining the Accountants Accelerator Group in 2014. Also block your diary out for The Accountant’s Top Gear Seminar on April 7, 2014.
Click HERE to download a full copy of the March 2014 edition of The General Journal.
Other articles in the March 2014 edition of The General Journal:How to Make 2014 Your Best Year Ever
Video Killed The Radio Star (But Not The Accountant)
GST - The Accountants Fractured Fairy Tale
Accountants Top Gear Seminar
7 Reasons Why Buyers Won’t Buy Your Practice
Wanted – New Breed Of CPA’s
Why Pay Dollar For Dollar When You Can Pay 5 Cents In The Dollar?