ELEVATING YOUR ACCOUNTING PRACTICEblog.insidepublicaccounting.com/wp-content/uploads/2014/... · 2014-11-19 · marketers need to know and understand what measurements are of interest

Copyright © 2014 INSIDE Public Accounting

ELEVATING YOUR ACCOUNTING PRACTICE

In business, results matter

Tapping the Expertise of the Nation’s Top Accounting Marketers, Business Developers and The INSIDE Public Accounting Benchmarking Metrics

Compiled by The Platt Group / INSIDE Public Accounting


Mike Platt Kelly PlattChris Camara

CONTINUING TO RAISE THE BAR

Dear Readers,

The Platt Group, publishers of INSIDE Public Accounting (IPA), wish to extend our gratitude to the marketers,

article contributors and the more than 540 accounting firms that participated in the 24th annual IPA Survey

and Analysis of Firms that made this report possible.

We hope that you will find value in this IPA INSIDER report and that you are able to find a path to

benchmark your firm to excellence.

IPA’s goal is to help firms of all sizes to maximize the value of the data available. The data included in this

report is meant to elevate YOUR firm in areas of growth, recruiting, retention, niches, business development

and more.

THE TALENT BEHIND THIS IPA INSIDER

The Platt Group / INSIDE Public Accounting

4000 W. 106th St., Suite 125-197, Carmel, IN 46032-7730 Phone: (317) 733-1920 Fax: (317) 663-1030

Web: www.insidepublicaccounting.com E-mail: [email protected]


LET’S START AT THE BEGINNING The Platt Group publishes two award‐winning publications: the monthly newsletter, INSIDE Public

Accounting (IPA), and the annual IPA National Benchmarking Report.

For more than 25 years, INSIDE IPA has surveyed hundreds of accounting firms on how they manage,

grow, and move the needle in the right direction for their firms. A picture emerges each year of the

factors that make a firm great, and marketing is a critical ingredient in the mix of attitudes and actions

that drive a firm to excellence.

Over the years, the IPA National Benchmarking Report has grown significantly, with more than 540 firms

participating in 2014.

Through years of data collection, combined with interviews with eight top accounting marketers from

firms large and small, IPA presents “Elevating Your Accounting Practice.”

Within the following pages, IPA shares interviews and benchmarking data graphs, on how you, as a

marketer can approach the strategic missions of your firms.

One chief marketing officer (CMO) says that it’s only been in the last few years that accounting firm

leaders understand what to expect from marketing efforts and are pleased with the results. It’s no

longer good enough for marketing to be relegated to a part‐time or ad hoc activity.

Firm leaders are seeking marketing and business development professionals who can manage an

increasingly sophisticated marketing program. They need diverse skills and the ability to show

undeniable results in the form of hard data. They also need the professional agility to perform for every

department, service line and industry group while considering revenue constraints, political issues and a

range of personalities.


ACCOUNTING FIRM BENCHMARKING 101:

METRICS THAT MATTER

The accounting profession is caught in an epic tug‐of‐war between recording the past and influencing

the future. By definition, accountants focus on the past, making sense of the objective, and undisputed

results of a client’s business. But clients value proactive, forward‐thinking, predictive ideas to help them

navigate and shape the future.

Similarly, the discipline of accounting firm benchmarking is caught in this same past‐future focus, with

firms seeking tools and metrics that are leading indicators, not just the traditional “how‐we‐measure‐

the‐past” lagging indicators of performance.

Marketers are in a key position to help their firms bridge the gap

between measuring the past and predicting the future. How? The

first step is to understand what partners measure and why. This

knowledge of traditional metrics will help marketers speak the

language of firm economics and better connect with partners on

the issues that are of most concern to them.

Guiding partners to look at leading indicators can help them see

problems and opportunities earlier and act on them in a way that

can influence the firm’s direction for the future. But first,

marketers need to know and understand what measurements are

of interest to partners.

Traditional Metrics That Are Meaningful to Partners: Not all metrics are created equal. Marketers may

be focused on the number of Twitter followers, email open rates or website hits. Partners are focused

on profitability, revenue per hour and staff utilization. You can deliver your highest value when you can

connect marketing activities with the results partners are monitoring.

Following are eight metrics that IPA uses to uncover trends and the health of a firm, based on results of

the 2014 INSIDE Public Accounting (IPA) Survey and Analysis of Firms. More refined benchmarks are

included in the 2014 IPA National Benchmarking Report, which provides 80+ pages of tables of metrics

based on firm size and Best of the Best.


NO BUSINESS STRIVES TO BE AVERAGE,

SO USE THESE METRICS AS BENCHMARKS.

THE TOP METRICS, IN NO PARTICULAR ORDER, INCLUDE:

Professional Staff Leverage: The leverage structure is an important component of

profitability, and is a reflection of the ability to deliver high‐quality services like tax and

audit at a lower cost.

Professional Staff Utilization: The average number of hours each professional staff

person is billable annually.

Net Revenue per Charge Hour: Average revenue for every charge hour – also a key

component of profitability.

Firmwide Profit Margin: Percentage of every dollar earned available for owner

compensation.

Net Revenue per FTE: The contribution each current FTE is making toward firmwide

revenue.

Net Income per Charge Hour: Total dollars available for partner compensation for every

billable hour.

Realization Percentage: How close the firm is to achieving the “retail” prices of all

services provided.

A/R and WIP Days of Production: How many days of production are “locked up” and

unavailable as current cash.

A firm (and the partner group that runs it), is driven by profitability, and one of the key metrics that

signifies profitability is Net Income Per Equity Partner, which reflects the total amount available at the

end of the year to distribute to equity partners. (Partner salaries are simply an “advance” on these

expected earnings and are not in addition to net income distribution.) Average net income per equity

partner is total net income of the firm divided by total number of equity partners, and can also be

obtained by multiplying the top four factors above, as expressed in the following formula:

Professional Staff Leverage X Professional Staff Utilization X Net Revenue per Charge Hour X Profit Margin

Using the averages for firms of $5 million to $10 million as an example, average net income per partner

can be derived as follows:

6.9 X 1,384 X $151.11 X 30.9% = $445,900


Why should a marketer or business development director care about net income per partner? Because

the work you are doing will ultimately influence the components of the formula above, which has a

direct effect on a partner’s income.

Firms have different philosophies regarding the kind of information shared outside the partner group. If

your firm has not or will not share this information with you, it is up to you to convince them why it is

important for you to understand the numbers. Put together a compelling business case. When you

relate your activities to the influence they can have on the key components of partner income, you will

have the ear of the partner group.

METRICS TO CONSIDER

There are a number of other metrics that traditional

benchmarking surveys do not measure and benchmark but

need to in order to help propel the profession into a future‐

focus on leading indicators. They are client‐focused, not

firm‐focused, and can be more subjective than the

traditional metrics described above.

Just as IPA looks at hundreds of firms to determine trends

and opportunities, individual firms can also look at

hundreds of clients to stratify them from “best” to “worst”

and determine where their energy should be focused to maximize results for the firm. While this creates

a challenge to compare “apples to apples” between firms, each firm can create a uniform approach to

these metrics internally that will help them get a better grasp on future opportunities and challenges.

Every firm should rank their clients A, B, C or D using whatever definition is appropriate and accepted in

your firm. (There are many ways to stratify your client base and definitions are varied.)

Once sorted in this way, each firm should create a dashboard with headings that look like the following

table graph:


For the Period Ending: Dec. 31, 20XX

Top 10% of

Metrics Clients by

Revenue/Fees A Clients B Clients C Clients

1 Target____ Actual___ Target____ Actual___ Target____ Actual___ Target____ Actual___



Metrics D Clients

1 Target____ Actual___



Each client category has a target defined and an actual number achieved for each metric, which can

provide your firm with a quick and easy way to focus its energy toward achieving maximum value.

With that as a reporting framework, here are some metrics that can provide the kinds of leading

indicators every accounting firm can use to maximize value to clients and therefore to the firm.

Lifetime value of a client

Average annual revenue per client in each client category

Percentage of total firm revenue derived from each client category

Cost of client acquisition

Client retention rate

RFP “win” percentage

Percentage of annual firmwide revenue in the pipeline

Profit margin per client

Number of firm services utilized per client

Percentage of on‐time completed projects

Opportunity index – total revenue received per client divided by total revenue you could be

getting per client if they were to engage you for additional services relevant to them

Number of face‐to‐face meetings per year


Number of referrals per client

Conversion rate from charge hours to retainer/fixed fee – if fixed fee is a desired preference

Ratio of “big issues” clients consulted the firm on versus those identified after‐the‐fact (such as

learning about it in the tax organizer).

Outside the dashboard, which focuses on target and actual metrics based on stratification of your client

base, firms, should track a number of other metrics to provide a clearer idea of how the firm is

performing.

Utilization by service

Realization by service

Profitability by service

Marketing expense as a percentage of revenue

Business development expense as a percentage of revenue

Percentage of total staff turnover made up of people the firm had hoped to retain

Pareto analysis of business client revenues

In the end, the metrics that matter are those that help drive your firm toward the goals it sets. Firm

philosophy, culture, practice mix and purpose all contribute to determining which metrics are right for

your firm.

ACTION STEPS

Be sure you are familiar with the traditional metrics outlined above, and know the numbers for

your firm (if possible).

If you have not yet ranked your client base A through D, decide how to do so now.

Meet with your partner group to determine which client‐perspective metrics may be critical to

achieving your firm’s mission.

Establish targets for each of the client classifications for each of the metrics.

Determine your firm’s actual numbers for each of the metrics.

Starting with the Top 10% and the A clients, establish a strategy for improvement.

Ensure that your firm participates in IPA’s Annual Survey and Analysis of Firms.


“THERE’S NO SHORTAGE OF REMARKABLE

IDEAS, WHAT’S MISSING IS THE WILL TO

EXECUTE THEM”. – SETH GODIN


THE 2014 INSIDE PUBLIC ACCOUNTING FASTEST-GROWING FIRMS

THEIR MARKETING BUDGET IS ABOUT THE SAME

AS OTHER PARTICIPATING FIRMS – ROUGHLY 2.5%

OF TOTAL REVENUES.

HALF THE FIRMS HAVE A BUSINESS

DEVELOPMENT DIRECTOR, ABOUT TWICE THE

AVERAGE OF THEIR SIMILAR PEER GROUP.

TWO-THIRDS HAVE CREATED A STRATEGIC PLAN

FOR EACH DEPARTMENT IN THE FIRM AND ARE

MANAGING TO THAT PLAN.

TWO-THIRDS OF THE FASTEST-GROWING FIRMS

HAVE A NICHE STRATEGY THAT RESULTS IN AT

LEAST ONE MARKET SEGMENT IN EACH FIRM

GENERATING A MINIMUM OF 20% OF ALL THE

FIRM’S REVENUES.


TAPPING THE EXPERTISE OF THE NATION’S TOP

ACCOUNTING MARKETERS AND BUSINESS DEVELOPERS

IPA conducted interviews with eight accounting marketers or business

developers who have produced results while navigating through difficult

environments. These professionals work in firms large and small, from $10

million to $500 million, from lone marketers to CMOs – one with a $9.5

million budget and responsibility for 38 full‐time staff.

Some describe themselves as marketers, others as business developers who happen to be marketers.

Some talk with clients directly; others are setting the foundation for the partners and professional staff

to make the sale.

Included in this white paper is an array of data drawn from interviews, from the more than 540 firms

that participated in IPA’s 2014 Survey and Analysis of Firms. Some data is specific to the marketing

function, such as average compensation, non‐personnel marketing costs, and marketing salary and

benefit costs as a percentage of the firm’s net revenue.


EARN THE TRUST OF THE PARTNER GROUP.

SPEAK THEIR [PARTNERS] LANGUAGE, AND MAKE FIRMWIDE MARKETING EASY.

ALWAYS FOCUS ON CLIENTS, NOT THE FIRM.

DEFINE YOUR FIRM’S COMPETITIVE ADVANTAGE.

EMBRACE SOME CHANGE, BUT NOT EVERYTHING.


“One of my secret weapons in the

budgeting process that I have been using

for years is a line item titled ‘Marketing

Opportunities.’ No matter how much you

plan and strategize, there will always be

great opportunities that come up that no

one knew about. It is nice to have the

money to be able to take advantage of

them.” – Ann Callister, Clark Nuber

“They need the numbers. I don’t think that

anybody can say – even if you’re in a

communication role, that you don’t know

Excel or you can’t work the numbers.”–

Caroline Rosen, MaloneBailey

NO. 1: EARN THE TRUST OF THE PARTNER GROUP

Marketing initiatives – or any initiative for that matter – will fail if the leadership is lukewarm or quietly

unsupportive. Any firmwide initiative needs a champion at the top who will set the tone.

When INSIDE Public Accounting (IPA) asked marketers/business development

leaders in the profession what they needed from the partner group to

succeed, all shouted something similar to this from Ann Callister of Bellevue‐

Washington‐based Clark Nuber: “Communication, collaboration and trust.”

But all interviewees

were quick to add that

it’s the responsibility of

the CMO/marketer/business development team to

build relationships with the partners to earn their

trust and to engage them in the overall plan.

Consider the experience of Caroline Rosen. It took a year and a half to

get a strategic marketing plan in place at MaloneBailey, which

concentrates 90% of its business on audits of small public companies.

Rosen says auditors are naturally skeptical, and rightly so, and some

thought of marketing as to “salesy.”

Rosen cleared up misconceptions, but says it was the big‐picture thinking

of John Malone (a “huge champion of mine”) that led to ultimate success.

Rosen conducted a PR campaign that resulted in 30 major media hits and

some “fantastic stories” about the experts within

MaloneBailey. Each partner began to see and feel the

impact. Business began trickling in, and it culminated in

the undeniable fact that the effort paid off for the firm

and its owners.


Mowat’s Advice: “Don’t

waste time on people who

say it doesn’t work.”

“I’m not asking for

their respect, I earn

it,” Antaya says.

“Do What I Say” management is

becoming a thing of the past

Majchrzak says.

Randy Mowat, a veteran marketer for Calgary,

Alberta‐based MNP LLP, started the firm’s

marketing department from scratch 20 years ago.

Mowat sought out all the partners who were

interested and believed in marketing and business

development and who were willing to try something new.

Mowat was the recipient of the IPA‐sponsored Association for Accounting

Marketing’s (AAM) 2014 Marketer of the Year award in 2014. Mowat says, “Leave

them [the non‐believers] on the sideline, and work with the group who will work with you. Show them

success and the trust will build.”

Jeff Antaya, CMO at Plante Moran, says nothing earns trust quicker than a

favorable return on investment. Show the partner group how the efforts

resulted in more clients with data that proves a positive impact on the

bottom line. Another way to build trust is to stay well‐informed of

developments within the field through a professional network. Antaya co‐

founded a CMO round table for the top 25

accounting firms, but also studies national

brands, professionals services marketing as

a whole and accounting firm marketing specifically.

Eric Majchrzak of BeachFleischman says that if a marketer doesn’t have

credibility within the industry, he or she may face a lot of questions about

what other firms are doing, he says, “but if you know what’s going on in

the industry and know what’s coming around the bend, and you have a

pulse on the industry, it’s a different dynamic.” He’s also made it a point

to know the best in the business in a range of different disciplines. These

leaders have become an advisory board of sorts for Majchrzak.

The best firm leaders stay focused on the firm’s mission and

vision. The best marketers make sure their marketing plans

support that vision, and are trusted to follow it though.


“COMMUNICATION,

COLLABORATION

AND TRUST.”


NO. 2: SPEAK THE LANGUAGE, AND MAKE FIRMWIDE MARKETING EASY

Marketers and business development staff need to understand

the environment they’re operating in and speak the language.

The Platt Group warns marketers not to make the mistake of

tracking metrics that are far different than those of the partners.

“Marketers need to know what is important to the partner

group and ‘connect the dots’ between the partners’ priorities

and the projects they’re working on.”

Marketers and business development staff must understand the environment they’re operating in and

speak the language of business within their partner groups. No excuses. “They need the numbers. I

don’t think that anybody can say – even if you’re in a communication role – that you don’t know Excel or

you can’t work the numbers,” says MaloneBailey’s Rosen.

Marketers and business development staff must know the bottom line of the firm’s revenues, what

benchmarks and goals need to be achieved and the industries the firm serves. Great marketers should

be involved in high‐level meetings to understand how to generate income for the firm.

Mowat says the idea of ‘making it easy’ extends beyond doing the work for the partners. Everything’s

got to be easy when you’re trying to build a successful business. It’s got to be easy for clients to interact

with the firm, and marketing efforts should give potential clients a glimpse of what it’s like to work with

the firm.

Antaya has the rare advantage of being a CPA who moved into business development and marketing.

MP Gordon Krater says one of the reasons Antaya was made a partner – a first in the firm’s history – was

because Antaya is a CPA and former entrepreneur who can speak “partnerese.” He calls that ability a

“true differentiator for us.” Krater adds, “Jeff doesn’t think in terms of ‘marketing,’ he thinks in terms of

growing a business.”

There’s no getting around it; owners have to take into consideration the expense of marketing, says Tom

DeVitto, CMO of BlumShapiro. Marketers are vulnerable if they haven’t done their job to explain the

impact on the bottom line to the partner group. “When you have the ability to quantify and monetize

things, they’re much more receptive.”


Marketing is cumulative and has the greatest impact over time. ROI is not easy to measure, but it’s

important to take the time to educate the firm’s leaders, so they understand the value chain. Take the

time to get into the nitty‐gritty details, DeVitto says, to illustrate the success of a particular campaign.

This is particularly important at budget time, when all tactics and strategies should be tied directly back

to the firm’s strategic plan. “If I can’t be successful at that, I am not going to be successful asking for that

dollar amount.”

June Landry, of Providence‐R.I.‐based Kahn Litwin Renza & Co., says she

measures impact by website analytics, lead generation and the number of

times that KLR is represented in the marketplace. Upgrading the website as a

publishing platform has generated close to $1 million in new and recurring

business, Landry says.

Website analytics allow marketers to track data at a minute level, but

sometimes it’s not worth spending the money to figure out the ROI, contends

Mowat of MNP. Take, for example, a billboard designed to raise awareness of

the firm. Mowat says he could, for example, pay $20,000 to survey the target audience on brand

awareness before and after the billboard was displayed. He says he’d rather take that money and put it

into the campaign. “I can’t waste my time on things that are very difficult to measure.”

Firmwide Engagement...Content marketing is driving many marketing programs today. If the firm views

writing an article or conducting a webinar as extra work instead of a valuable activity, it’s bound to

flounder. Marketers NEED do the outreach, write blog posts in the voice of the firm, and ensure the

internal approval process is fast and uncomplicated.

“Marketing is like air conditioning. It’s valuable in South Florida. When it’s working no one

notices it, but when it isn’t everyone notices.” — Melissa Gracey, Berkowitz Pollack Brant

Melissa Gracey of Miami‐based Berkowitz Pollack Brant, an IPA Best of the Best

Firm, uses a network of freelance writers with expertise in finance and forensics

to ghost‐write articles.

Gracey outlines talking points for partners going into speaking engagements or

interviews with reporters, and of course reuses the content in as many ways as

possible. “The things that make me the happiest is when someone takes

message points that I’ve written and gives a great presentation that flows, and it

sounds like it came right from their heart.”


NO. 3: FOCUS ON THE CLIENTS, NOT THE FIRM. Every business needs to articulate what sets them apart, and

they need do it in a way that is meaningful and impactful.

The best marketers are giving their firms new ways to

connect with clients and their business problems, which are

defined by the clients, not the firms.

BeachFleischman’s Majchrzak saw a “sea of sameness” when

he entered the accounting firm marketing arena from financial services 10 years ago. It was a traditional,

conservative and in some ways, not personal or “real” to clients. “We have to be relevant, and the only

way we can do this is to really understand what clients value, what their needs are and what keeps them

up at night,” he says.

Marketers and business development staff help clients connect with the services and talent the firm has

to offer. Content marketing helps with this, as this type of information positions the firm’s professionals

as experts, while giving clients, and potential clients, a new way of looking at a business problem.

Landry says KLR works hard to communicate with clients in the ways the clients are comfortable with, be

it phone, email or social media. “This is an ongoing process. Using analytics, content and our team, we

are finding out how our clients look up information, what that information is and how to get it to them.”

Website analytics can capture data on what website visitors are interested

in, and how they’re trying to “self‐serve” through the site.

Tom DeVitto says BlumShaprio aims for a “one‐size‐fits‐one” approach.

With partners gaining deep intelligence in each service area and truly

understanding their clients’ business objectives, marketing efforts can

become even more targeted and precise, with the goal of not only

increasing awareness of the firm, but driving behavior.


DR. SEUSS SAYS - “WHY FIT IN WHEN YOU WERE BORN TO STAND OUT?

NO. 4: DEFINE YOUR COMPETITIVE ADVANTAGE

So many firms sound alike. “We do good work”

isn’t enough. Accounting firms have to do better

than this.

All clients expect and deserve superior customer

service. Technical expertise. Reasonable fees.

Integrity and honesty. You need to identify those

clients that YOUR firm is the only answer.

EXAMPLES OF DIFFERENTIATION:

DeVitto says New Englanders relate strongly to their particular communities, and BlumShapiro uses that

trait to its advantage. The firm achieves differentiation by concentrating on market share in specific

targeted locations. Firm professionals live and work in these communities, and they get deeply involved

in outside endeavors, which builds goodwill in the community and raises awareness of the BlumShapiro

brand. The public relations benefit has paid off in a big way, says DeVitto.

Plante Moran, after a 2012 merger with Blackman Kallick, decided to combine two office locations into

one in downtown Chicago. Antaya was challenged with the task of drawing attention to the first‐floor

reception and conference room space, make it fun, and tell the story of Plante Moran to the tens of

thousands of people who walk by the building every day.

He worked with the School of the Art Institute of Chicago to display art year‐round in the firm’s

reception area. He connected with another school, the Tribeca Flash Academy, which created nine video

boards behind the reception desk that highlight the firm’s story.

The conference room was open to non‐profits needing meeting space. All of these moves combined to

build the firm’s brand in the Chicago market. “One Plante Moran recruit even told us she applied for a

position because she thought we’d developed a ‘really cool space’ and wanted to work for a company

that put that kind of energy behind it,” says MP Gordon Krater.

Gracey of Berkowitz Pollack Brant says one way she signals that her firm is different is by creating

marketing pieces that are not typical run‐of‐the‐mill campaigns. Instead of creating an 8‐by‐10 brochure,


Gracey sold the partners on investing in a 75‐page oversized magazine, which included 25 articles. “We

want people to say, ‘Hey Marge check it out.’ We want to be a little bit different.” Firm leaders were

“knocked out” with the result, which covered all the firm’s services. “It’s not a tax return factory, it’s not

a financial statement factory. We’re consultants.”

NO. 5: EMBRACE CHANGE, BUT NOT EVERYTHING.

Professional services trends are ever‐changing and

sometimes become priorities because everyone else is

doing it. When Callister began her career at Clark Nuber in

Bellevue, Wash., 16 years ago, cold calling was the “big

thing” in the industry.

When the person in that position left Clark Nuber soon

after Callister was hired, she shut down the operation,

believing it wasn’t appropriate for the firms business model

or reputation.

Over the last several years Callister has embraced the social media hype as it has become more of a

priority, as more and more staff, clients, etc., communicate in this fashion. “We’re heavily involved in it

and we do it very well, but I can tell you that it doesn’t drive business to the firm like it does for retail or

hospitality or other types of industries,” Callister says. Living in the Seattle area, she monitors and learns

from the tech industry giants in her backyard.

Marketers must be knowledgeable and nimble enough adapt to the changing media environment.

Keeping current with the technology is imperative. Majchrzak describes himself as an “extreme early

adopter.” He’s been a beta tester for Google plus, Twitter and Facebook, and he’s used digital and web

technology, including social media, search engine optimization and mobile marketing to generate

millions of dollars of revenue for firms over the course of his career. Not everything worked, though.

Majchrzak was one of the first accounting firm marketers to incorporate QR codes into materials at

Buffalo, N.Y.‐based Freed Maxick in 2009. “It was way too cutting‐edge. I thought it would revolutionize

the way we presented information to people, but it fizzled out.”

Mowat also tried and abandoned QR codes, and is less eager about jumping into new technologies. “I’m

proud to say we’re NEVER first out of the gate on these things. I have no problem sitting back and


watching and waiting,” he says. “I’ve always started with the basics,” he says. “If my audience is on that

channel, I’m on that channel. If I don’t see my audience there, I’ll be aware of it, I’ll learn about it, but

I’m not going to use it.”

Proposal writing is an emerging sector of the marketing and business development role that didn’t exist

10 years ago, says Antaya at Plante Moran. He helped create a dedicated team of proposal writers to

sharpen how partners communicate what differentiates the firm from the rest. A consultant reviewed

the existing process and materials, provided feedback and training, and the firm created a model for

proposals over $50,000. The proposal package was smaller, with more information graphics, less text

and a consistent message. The content is more focused on the client than on the firm while

demonstrating the firm’s expertise at the same time. A market research firm comes in after the fact to

survey potential clients on what went well or not‐so‐well in the proposal process.

Potential clients are not always looking for the lowest price, Antaya says, and the process reveals what

works and what doesn’t. The process is now standardized, and is led by a team of six. Their win rate is

51% and they contribute to $9 million in business development.

Failure is OK. Mowat recalls a campaign targeted at the manufacturing sector in British Columbia that

was met with dead silence. “It’s OK to fail,” Mowat says. “It’s not OK not to try. That’s part of our DNA.”

When you feel you have permission to experiment, you’ll end up with a much better product, marketers

say. Again, it goes back to trust, says Landry. “Some marketing activities that are ‘out of the accounting

firm box’ can provide a great return on investment.” Trusting your marketing director [or business

development director] will allow her/him to try different activities and be successful.

Not everything is going to work, but marketers must not lose sight of the firmwide strategic plan and

how marketing fits into it (hopefully through a formal marketing plan). As long as everyone believed the

initiative was strategic, it’s usually OK if it didn’t work.


2013-2014 MARKETING COSTS

MARKETING DEPARTMENT COSTS Marketing Staff – Compensation and Benefits as a PERCENTAGE of firm net revenue

Firm Size Average High Low

>$50 Million 0.71% 1.10% 0.30%

$20 Million - $50 Million 0.75% 1.40% 0.30%

$10 Million - $20 Million 0.85% 1.90% 0.08%

$5 Million - $10 Million 0.91% 1.60% 0.55%

< $5 Million 0.89% 1.31% 0.00%

MARKETING DEPARTMENT COSTS – EXCLUDING COMPENSATION As a percentage of net revenue, what are the non-personnel costs related to this group?

e.g. marketing materials, advertising, etc.


>$50 Million 1.24% 3.44% 0.30%

$20 Million - $50 Million 1.98% 3.30% 1.30%

$10 Million - $20 Million 1.67% 4.46% 0.03%

$5 Million - $10 Million 1.65% 3.20% 0.66%

< $5 Million 1.37% 3.70% 0.15%

Source: INSIDE Public Accounting National Benchmarking Report - 2014


2014 MARKETING STAFF COMPENSATION

MARKETING DIRECTOR COMPENSATION


>$50 Million $146,340 $250,000 $77,580

$20 Million - $50 Million $118,685 $167,000 $71,018

$10 Million - $20 Million $133,916 $308,000 $60,000

$5 Million - $10 Million $95,501 $166,000 $57,500

< $5 Million $61,444 $77,000 $53,333

MARKETING COORDINATOR COMPENSATION

Firm Size Average High Low >$50 Million $69,102 $150,000 $43,050

$20 Million - $50 Million $63,375 $183,500 $36,400

$10 Million - $20 Million $51,089 $122,647 $20,650

$5 Million - $10 Million $48,402 $70,500 $28,811

< $5 Million $45,974 $60,000 $32,795



INSIDE PUBLIC ACCOUNTING BENCHMARKING DATA 2010 – 2014

PERCENTAGE OF FIRMS THAT HAVE A WRITTEN MARKETING PLAN

2014 – 64% 2013 – 60% 2012 – 59% 2011 – 61% 2010 – 63%

AVERAGE MARKETING DIRECTORS’ COMPENSATION

2014 – $111,762 2013 – $108,043 2012 – $112,584 2011 – $114,007 2010 – $108,786

AVERAGE MARKETING COORDINATORS’ COMPENSATION

2014 – $55,840 2013 – $54,331 2012 – $58,761 2011 – $56,967 2010 – $57,137

PERCENTAGE OF FIRMS WITH MEMBERSHIP IN AAM

2014 – 48.1% 2013 – 48.3% 2012 – 51.3% 2011 – 53.0% 2010 – 45.9%



Conclusion A note to firm leaders: Your people are your product. Your professionals are already representing the

firm with excellence, and your marketers are positioning them as experts in their specialty. Marketers are

your biggest cheerleaders. It’s their job to make you look good. You’re the experts, get behind the

marketers who are elevating your professionals as the leaders in various niches. Marketers should be

involved in the many of the decision‐making processes. They have a different perspective to bring to the

conversation, and should be a welcomed addition. Some of the professionals IPA interviewed are strong proponents for joining business development and

marketing into one unit; some see themselves as strictly marketers – they’re setting the table and the

partners are closing the deal. There’s a wide range of talents among firm marketers, some are still

organizing events and ordering the golf balls with the company logo while other are far more strategic

and “big picture‐oriented.”

Ultimately, the responsibility of success lies with the partner group. Marketers should urge partners to

visit their clients in their places of business, understand the full range of services the firm offers, not just

their area of practice and “live the brand.” Marketers write the copy, send the messages and position the

firm in the best possible light, but it’s up to the partners to bring it all to life.

But whether partners are gung‐ho or not so interested, all of them are marketing the firm whether they

know it or not, says Melissa Gracey of Berkowitz Pollack Brant. That includes the brand‐new hire, the

partner who was hired from another firm or the technical whiz who avoids the networking circuit. “One

of the first things I say is that everyone is in marketing. Everyone represents the firm.”

The Platt Group

INSIDE Public Accounting

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ELEVATING YOUR ACCOUNTING PRACTICEblog.insidepublicaccounting.com/wp-content/uploads/2014/... · 2014-11-19 · marketers need to know and understand what measurements are of interest