Center >> December 2008
CPAs Love Recessions
And how you can too.
by Rick Telberg/For the CPA Channel Marketer
AICPA Custom Media Solutions
With the worst recession in perhaps a generation,
some CPA channel marketers are battening down the hatches. But,
if past slowdowns are any guide, the competitive winners in 2009
will be those marketers who can afford to maintain and even extend
their spending and investment plans.
Historically, CPAs and accounting firms are recession-resistant.
They enter recessions later, bottom shallower and recover sooner.
The core services a CPA provides cannot be cut out of a budget —
tax returns must be filed, bank statements reconciled, monthly P&Ls
prepared and payrolls run. There’s nothing as reliable as
death and taxes; and CPAs can make money on both.
For CPA channel marketers, five lessons
Don’t flag in demonstrating your commitment to the CPA business.
The vendors who maintain or even extend their marketing activities
in a downturn will strengthen their positions. CPAs
believe that many of those that cut back will disappear forever.
Innovation pays. While
no one’s looking, nimble upstarts will emerge to challenge
Expect consolidation. The
firms and companies that can, will continue expansion-by-acquisition
Follow the leaders. In
a classic “flight to quality,” consumers and clients
are turning increasingly to CPAs over non-CPAs for their professional
Every accountant knows their mother was right. And
in times like these, they can practically hear their mother’s
voice saying: “Become an accountant and you’ll always
make a living.” The fact is, most accountants today are making
a very good living indeed.
Take a look at the latest jobs report from the U.S.
Department of Labor, which showed the overall economy lost 533,000
jobs in November — but it also showed gains for CPA firms
again non-CPA accountants and bookkeepers.
For the broad accounting and bookkeeping services
category, the government counted 974,500 persons employed, which
includes everyone from staff accountants to self-employed tax practitioners.
November’s figure represents a loss of 1,700 jobs in the month,
and an 18,800 loss from the record peak of 993,300 in December 2007.
But look a little
closer, and the numbers tell another story: The market appears to
be consolidating around the market leader — the Certified
firms are expanding their employee rosters and continuing
to gain market share against non-CPA accountants. CPA firms
had 450,200 employees in the latest month, for which data
is available, up 23,300 jobs from the year-ago month, or 5.5
non-CPA-owned payroll services and other accounting services
CPAs and CPA firms are positioned to gain market share and
even grow their business in this economic cycle.
on the ground bear that out. A number of established CPA firms
are consolidating their hold on their markets — effectively
investing in the business they know so well.
weeks, a number of large and small firms have announced new
acquisitions, including: Weaver & Tidwell, JH Cohn, Rothstein
Kass, Brown Edwards & Co., Habif Arogeti & Wynne,
Burr Pilger Mayer, Eide Bailly and Crowe Horwath.
veteran vendor told me: “Regulatory compliance, government
audits, restructuring, work outs, bankruptcy activities, liquidations,
fraud, expert witness activities — CPAs will be fully
employed for many years to come.”
almost 20 years in the finance and accounting business, I
can tell you personally that the vendors who can and do maintain
aggressive marketing postures will emerge even stronger a
year from now.
CPAs ask me every
day about various vendors in the marketplace. CPAs are conservative
by nature and training. They want the best deal, of course.
But they also want to invest their precious time and reputation
in a stable and reliable partner.
In times like these
I tell them that their choices are simplified: Go with the
vendors who demonstrate a commitment to the business. Go with
the ones who are advertising, innovating and supporting the
profession’s future development. They’re the ones
who will still be around in good times, as well as bad.
authoritative studies show that recessions can be huge opportunities
for smart marketers — if they know the rules:
cut your advertising budget, increase it. Let your
competition cut theirs. When you increase your spending,
you increase your share of voice. If your competitors cut
back, your message grows even stronger.
Develop a strategic marketing plan so you don't
waste money advertising the wrong message in the wrong place
to the wrong audience.
your customers. Implement marketing strategies
that allow buyers to feel they are minimizing risk by doing
business with you.
greater media efficiency by taking advantage of
softer rates and special promotions.
sponsoring. This type of awareness advertising
gives your business valuable exposure to targeted, core
your friends. You know who your loyal customers
are. Keep in touch with them and let them know what you
have to offer.
Maintain continuity to sustain awareness. Advertising
works cumulatively so you have to remind people frequently
about your brand or they'll forget you.
Step up public relations efforts. Be sure to maintain
a media presence with smart, effective PR programs.
"cheapen" your advertising by trying
to save on creative or production costs. Your customers
will notice and worry about quality. This is a time to stress
quality and value.
The Clark Company)
TELBERG is AICPA Editor at Large and president of Bay
Street Group LLC. He also blogs at CPA
Trendlines. In his two decades in media and marketing for
the finance, tax and accounting industries, Telberg has played
pivotal roles in the development and operation of the leading
media and e-commerce outlets in the business, including Accounting
Today, The Practical Accountant, Accounting Technology, WebCPA.com,
SmartPros.com, and CPA2Biz.com. Contact him by e-mail at email@example.com
or by phone at (914) 674-4531.