{"id":72929,"date":"2020-04-17t12:00:00","date_gmt":"2020-04-17t16:00:00","guid":{"rendered":"https:\/\/48e130086c.nxcli.net\/?p=72929"},"modified":"2020-04-27t10:49:18","modified_gmt":"2020-04-27t14:49:18","slug":"how-not-to-develop-your-practice","status":"publish","type":"post","link":"\/\/www.g005e.com\/2020\/04\/17\/how-not-to-develop-your-practice\/","title":{"rendered":"how not to develop your practice"},"content":{"rendered":"<p><strong><a href=\"https:\/\/cpatwpe.s3.amazonaws.com\/cpatrendlines\/wp-content\/uploads\/2016\/04\/targetaudience_adobestock_52316043.jpeg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignright size-medium wp-image-48675\" src=\"https:\/\/cpatwpe.s3.amazonaws.com\/cpatrendlines\/wp-content\/uploads\/2016\/04\/targetaudience_adobestock_52316043-424x283.jpeg\" alt=\"\" width=\"424\" height=\"283\" srcset=\"https:\/\/cpatwpe.s3.amazonaws.com\/cpatrendlines\/wp-content\/uploads\/2016\/04\/targetaudience_adobestock_52316043-424x283.jpeg 424w, https:\/\/cpatwpe.s3.amazonaws.com\/cpatrendlines\/wp-content\/uploads\/2016\/04\/targetaudience_adobestock_52316043.jpeg 300w, https:\/\/cpatwpe.s3.amazonaws.com\/cpatrendlines\/wp-content\/uploads\/2016\/04\/targetaudience_adobestock_52316043.jpeg 600w, https:\/\/cpatwpe.s3.amazonaws.com\/cpatrendlines\/wp-content\/uploads\/2016\/04\/targetaudience_adobestock_52316043-768x512.jpeg 768w, https:\/\/cpatwpe.s3.amazonaws.com\/cpatrendlines\/wp-content\/uploads\/2016\/04\/targetaudience_adobestock_52316043-849x566.jpeg 849w, https:\/\/cpatwpe.s3.amazonaws.com\/cpatrendlines\/wp-content\/uploads\/2016\/04\/targetaudience_adobestock_52316043.jpeg 1600w\" sizes=\"auto, (max-width: 424px) 100vw, 424px\" \/><\/a>these activities aren&#8217;t your savior.<br \/>\n<\/strong><\/p>\n<p><i>by marc rosenberg<\/i><br \/>\n<a href=\"\/\/www.g005e.com\/product-category\/marc-rosenberg\/?orderby=title-desc\"><i>the rosenberg practice management library<\/i><\/a><\/p>\n<p>discipline 4 activities support disciplines 1, 2 and 3. they comprise your firm\u2019s efforts to promote the firm and drive selling opportunities <strong>to<\/strong> the firm.<\/p>\n<blockquote><p><b>more: <\/b><a href=\"\/\/www.g005e.com\/2020\/04\/10\/6-keys-to-developing-prospects\/\">6 keys to developing new client prospects<\/a> | <a href=\"\/\/www.g005e.com\/2020\/03\/27\/how-to-leverage-referral-opportunities\/\">now is the time to activate your referral network<\/a> | <a href=\"\/\/www.g005e.com\/2020\/01\/10\/the-4-marketing-disciplines\/\">the 4 marketing disciplines<\/a> | <a href=\"\/\/www.g005e.com\/2019\/12\/15\/why-you-have-to-kill-the-old-paradigms\/\">why you have to kill the old paradigms<\/a><br \/>\n<strong><img loading=\"lazy\" decoding=\"async\" class=\"alignleft size-full wp-image-49700\" src=\"http:\/\/4f2bur4nuye2cgakm2rm61qk.wpengine.netdna-cdn.com\/wp-content\/uploads\/2016\/08\/yellow_key_clip_art-e1375897299811-36p-hi-1-e1470686574894.jpg\" alt=\"goprocpa.com\" width=\"39\" height=\"16\" \/><span style=\"color: #b79c00;\">exclusively for pro members. <\/span><\/strong><span style=\"color: #b79c00;\"><a style=\"color: #b79c00;\" href=\"\/\/www.g005e.com\/wp-login.php?redirect_to=\/\/www.g005e.com\/2020\/04\/17\/how-not-to-develop-your-practice\/\">log in here<\/a> or <a class=\"external\" style=\"color: #b79c00;\" href=\"http:\/\/goprocpa.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">2022世界杯足球排名 today<\/a>.<\/span><\/p><\/blockquote>\n<h3>a contrarian view<\/h3>\n<p>read this carefully because it is one of our most powerful messages.<br \/>\n<!--more--><br \/>\nwe already have discussed discipline 1, 2 and 3 marketing activities and opportunities:<\/p>\n<ul>\n<li>discipline 1: protect and grow <strong>existing<\/strong> clients.<\/li>\n<li>discipline 2. identify and nurture <strong>referral<\/strong> sources.<\/li>\n<li>discipline 3. focus on <strong>prospective<\/strong> clients.<\/li>\n<\/ul>\n<p>discipline 4 activities support the first three disciplines and include putting on seminars, speaking at conferences, writing articles and many others.<\/p>\n<p>you might think that an article on practice development and growth would be an enthusiastic advocate of discipline 4 activities. but such is not the case. we\u2019re not suggesting you <strong>ignore<\/strong> these activities. but if you embrace a marketing plan that focuses on discipline 4 to the detriment of disciplines 1, 2 and 3, you are going to be <strong>very<\/strong> disappointed with the results.<\/p>\n<p>we refer to discipline 4 activities as \u201cthe bottomless pit of great ideas.\u201d firms that focus too heavily on discipline 4 activities are focusing on things that aren\u2019t likely to get the results they are looking for. they are not the primary vehicle for growth. discipline 1, 2 and 3 activities are.<\/p>\n<p>you may have watched or at least heard of the blockbuster television series \u201cmad men<em>.\u201d<\/em><\/p>\n<p>the show was about a 1960s madison avenue advertising firm that had the uncanny ability to design astonishingly creative ads and promotions for clients\u2019 products. these promotions repeatedly produced an \u201coh, wow\u201d impact on customers, who purchased the products in prodigious numbers, enabling the clients to reap a return on their advertising dollars multiple times over.<\/p>\n<p>reality check: \u201cmad men<em>\u201d<\/em> was a tv show. fiction. hiring the most creative advertising executives on \u201cmad men<em>\u201d<\/em> would never work for cpa firms.<\/p>\n<p>a company looking to hire a cpa firm is not going to choose a firm based primarily on discipline 4 activities. companies hire cpa firms based primarily on referrals from credible sources or people they meet at networking events, outside organizational functions and other <strong>people-related<\/strong> activities.<\/p>\n<p>if you don\u2019t buy this, let us offer proof. cpa firms typically spend 3 percent of their revenues on marketing. for a $5 million firm, that\u2019s $150,000. for a $10 million firm, that\u2019s $300,000. for a $30 million firm, that\u2019s $900,000. big bucks that, as an industry, add up to a few billion dollars. what is the return on this investment?<\/p>\n<p>the cpa industry\u2019s organic growth rate for the period of 2015 to 2018 was roughly 4-5 percent (excluding revenue growth from mergers). but this growth is clearly not solely the result of discipline 4 activities because 50-80 percent of all organic revenue growth comes from referrals, expansion of services to existing clients and individual business development efforts that are nearly totally independent of marketing expenditures.<\/p>\n<p>so let\u2019s put this all together. if a $10 million firm spends 3 percent of its revenue on marketing, that\u2019s $300,000. if the firm\u2019s organic growth is 5 percent, or $500,000, and 75 percent is the result of referrals, expansion of services and individual business development activities, that leaves $125,000 of the annual growth that <strong>may have<\/strong> resulted from marketing activities. is the investment of $300,000 a year in marketing to bring in $125,000 of revenue a wise decision? this may not be the best way to analyze the wisdom of marketing expenditures, but you get the point.<\/p>\n<p>it\u2019s amazing how much time and money cpa firms spend on things like social media, websites and blogs\/newsletters, with the expectation that increased revenue dollars will flow unabated. we are believers in the value of marketing directors, but unfortunately, we have seen many misguided marketing personnel tout their accomplishments in discipline 4 activities that led to meager increases in revenue. amazingly, we have met many marketing directors who don\u2019t even know what their firms\u2019 revenue growth is, which is the ultimate height of lunacy.<\/p>\n<h3>our message<\/h3>\n<p>most cpas and hence, their firms, don\u2019t like business development activities. every day, firms have a partner meeting at which complaints are aired about the firm\u2019s slow revenue growth. the partners agree that they are unwilling to increase their level of business development. the group then decides to invest in one or more discipline 4 activities. the firm happily writes big checks, anticipating that these investments will surely solve their growth problems. then, months later, when the inevitably disappointing return on their marketing investment becomes clear, they discontinue the failed activities. they&#8217;re right back where they started, with nothing to show for all that effort.<\/p>\n<p>yes, without doubt, include discipline 4 activities in your firm\u2019s marketing budget. but understand that discipline 4 activities are intended to support and complement discipline 1, 2 and 3 activities. they are not intended to be the firm&#8217;s primary growth vehicle.<\/p>\n<p>let\u2019s review the definition of marketing.<\/p>\n<p>marketing tactics are designed to create brand awareness and name recognition and in general make it easier to sell. marketing drives clients, prospects and referral sources to the firm. marketing is all about providing at-bats for firm personnel to make hits (sales).<\/p>\n<p>somewhere eternally buried in our office files is an article written long ago by an \u201colder\u201d cpa who described his idea of how a \u201cprofessional\u201d cpa attracts clients. he ridiculed the practice of soliciting business and overtly promoting one\u2019s firm, ruing the bates decision as an unwelcome development. this cpa\u2019s main point was that all a cpa needs to do to attract clients is to do great work, sit back and wait for the unsolicited referrals to pour in.<\/p>\n<p>this cpa must have been psychic because he was making the same point as a movie that had yet to be filmed, the 1989 classic \u201cfield of dreams<em>.\u201d <\/em>in this movie, a nearly bankrupt farmer in iowa, played by kevin costner, had a vision to transform his fields into a baseball park because he kept hearing a voice whisper, \u201cif you build it, they will come.\u201d and because it\u2019s a movie, they came!<\/p>\n<p>the \u201csit-back-and-wait-for-referrals\u201d approach to business development may have worked in the past, but it usually fails miserably in selling cpa services.<\/p>\n","protected":false},"excerpt":{"rendered":"<p><strong>these activities aren&#8217;t your savior.<\/strong><br \/>\n<em>by marc rosenberg<\/em><br \/>\n<em><a href=\"\/\/www.g005e.com\/product-category\/marc-rosenberg\/?orderby=title-desc\">the rosenberg practice management library<\/a><\/em><\/p>\n","protected":false},"author":1339,"featured_media":52068,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":""},"categories":[1363,2271,3120,3002],"tags":[],"class_list":["post-72929","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured","category-marketing","category-pro-member-exclusive","category-special"],"acf":[],"yoast_head":"<!-- this site is optimized with the yoast seo plugin v24.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ 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