Category: Advanced Tutorials

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Marketing cost comparison for reaching $1 million

I recently released the 5th edition of my book about building a million dollar taxpayer representation firm, and one of the things I addressed in this edition is the concept of stepping up your marketing expenditures in logical increments.

As I was thinking about this, it dawned on me that many existing IRS representation practitioners probably think that it’s cost prohibitive to build a practice that size by using the kind of marketing that I advocate doing. Due to this line of thinking, they instead do what “tax resolution” firms do: Hire an army of telephone openers and closers to cold call tax liens.

Not only is this practice a violation of Treasury regulations, it’s also one of the practices that gives a black eye to all of us engaged in taxpayer representation. Companies use this boiler room telemarketing approach for an obvious reason, of course: It works.

This leads practitioners to think it’s more cost effective to do business this way. But is it really?

What does it take to hit $1 million in new client fees annually? Grab your calculator, folks…

Assuming an average fee of $3,500 per client (which is actually on the low side, but it never hurts to be conservative), we need 285 clients per year to hit the magic million mark.

Now, you’re going to have to take my word for it on these conversion numbers — but I can assure you they are based on real life experience in real tax firms, not just on conjecture. The average telemarketer (“opener”) must dial 60 tax liens in order to find one interested person, who is transferred to a sales closer in most boiler room operations. This closer will close, on average, 9% of these prospects. So, in order to get ONE new client, a company has to churn through 660 tax lien filings, at a typical cost of 35 cents per record to purchase. So, that’s $231 just in lead costs.

Now, the opener also typically gets a 10% commission at most companies, and the closers receive, on average, 20% to 30%. Lets’s again be conservative, and together give the sales guys 30%. Note here that we are also ignoring minimum wage laws and other costs for this sales staff, which most firms do ignore, believe it or not. So our $3,500 new client also costs us $1,050 in commissions, for a total of $1,281 that we … Continue reading

The Complete, Yet Simple, Marketing Plan For Solo Tax Practitioners

Are you riding solo on the tax firm highway?

If you are a licensed tax professional (EA, CPA, attorney) in private practice, then this is the article you are going to want to save. Bookmark it, print it, star it.

As a solo practitioner, you are on your own. You are the marketing department, sales department, client services department, all wrapped up into one person. Building your practice is going to take work, and you must also successfully manage your time between case work and marketing.

In general, I would suggest you plan to spend at least one to two hours per day working on your sales and marketing.

Marketing is not a 10 minute per week activity. In fact, most business consultants will tell you that you should spend at least half your day on marketing…even more if you are just starting out. With the simple, yet effective, marketing plan I will outline here for you, you’re going to need to commit one or two hours per day. However, using the plan outline here, you will be successful and make a living, as long as you commit to following the steps.

Do note that I am not addressing fee structures, technology setup, list building, and other such concerns in this post, I am simply addressing the marketing and sales plan. So, here we go…

Step 1: Write a weekly article about a topic of interest to your target audience. This article should NOT be your typical “tax tips” sort of thing. Your prospects and clients comes to YOU for handling their tax matters — they don’t care about how to do it themselves. Think more along the lines of:

  • Client success stories related to tax planning, real estate investing, tax debt resolution, etc.
  • Your personal analysis of Congressional and state legislative action, IRM updates, etc. Let people know the gist of what’s going on, why they should care, and how you can help.
  • What you’re doing to increase your own knowledge and improve your skills for your clients. Write about the CPE/CLE courses you take and how that will help your clients.

That’s just the tip of the iceberg. Take that article and use it in as many places as you can:

  • Post it to the blog section of your web site. If you don’t have a blog attached to your web site, one of your highest marketing priorities should be to get
… Continue reading

How to leverage written tax articles to get more leads

Today it’s called content marketing, but the reality is that it’s one of the most effective marketing strategies in the history of capitalism.

The core idea behind this strategy is to create engaging content that entertains and educates your target market, while simultaneously reminding your prospects that you possess the solution to their tax problem.

That problem can take numerous forms, from the frustration of completing their tax return to the nightmare of owing millions in back taxes.

In my tax resolution practice, ALL of my marketing leverages the concept of content marketing, in one way or another. Everything from my free reports offered in response to letters and postcards, to 24 hour recorded information lines, to my books written for consumers — all of this is content marketing.

What’s this about writing articles?

Despite the prevalence of video on the Internet today, the fact remains that the Internet is a platform built with and for the distribution of the written word. We still use words to search for things on Google, and Google must still use words on pages to determine the relevance of web sites.

On top of that, direct mail is still one of the most effective means available for reaching new prospects, reactivating lost clients, and keeping existing clients coming back. From reaching out to new movers in to the neighborhood for tax prep season, to tax lien marketing, to client newsletters, direct mail, and it’s inherent use of the written word, is something that should be part of every tax professional’s marketing arsenal.

The written word, despite the audiovisual world in which we live, is still a remarkably valuable form of communication. Aside from being a tool for appearing high in search engine results, the written word is a vehicle for attracting new prospects and converting prospects into clients.

Why is this? Never forget that, no matter what services we actually provide to our clients, we are in the people business. People do business with other people, something that some really big accounting, legal, and consulting firms seem to forget.

Before a new client ever gives you a dime, three things in particular must happen:

1. They must come to know who you are (which is why we do marketing).
2. They must come to trust you and your ability to address their needs.
3. They have to like you (this is the step that … Continue reading