Strategy and Implementation
The business is driven by referrals, so for the first few years Marcus Accounting will need to be more aggressive in getting new clients, who will then pass the word on, and the business can begin to experience organic growth.
Marketing Strategies
Target Markets - Business (Market County)
- Small businesses (up to 20 employees) with an emphasis on new business start-ups
- Self-employed (for example, contractors)
- Home-based businesses (for example, consultants, freelance, professionals)
Target Markets - Consumer (Market County)
- Upper-income households
- New residents in the area
- Women (elderly or single)
- Seasonal residents
Positioning and Product Strategy
For both business and consumer clients, Marcus Accounting will be positioned as a full-service accounting service that takes the time to get to know the client's business (or situation) and become a financial partner "keeping an eye on the client's dollar." A full range of accounting, bookkeeping, and tax-related services will be made available and tailored to the needs of the particular market segment.
Business service needs range from annual tax filing to monthly recordkeeping and reporting, including accounts payable and receivable, payroll and payroll tax reporting, sales and use tax reporting, bank reconciliation, profit/loss and cash flow statements. Marcus Accounting will aim to attract the business clients needing monthly accounting services in order to even out revenues throughout the year.
Consumer clients primarily need annual tax filing services; however, in keeping with the positioning, Marcus Accounting will also offer tax planning, personal budgeting, credit counseling, and checkbook reconciliation services. A special effort will be made to attract seasonal residents who need someone to make deposits and pay bills while they're away.
Distribution Strategy
Unlike products which are produced, then distributed and sold, accounting services are produced and consumed simultaneously in a real-time environment. Thus, distribution issues center on making the services available in a convenient manner to the most number of potential clients. Marcus Accounting maintains an office in the home of its owner, Mary Beth Marcus, so clients are able to come to her home/office to access her services, or Mary Beth will meet with clients in their home or office, whichever is more convenient. This flexibility is especially attractive to elderly or disabled clients. Clients can contact Marcus Accounting by telephone, fax, and hopefully soon e-mail. Marcus Accounting offers evening and Saturday appointments, in addition to the regular business hours.
Pricing Strategy
A sliding scale of fees has been developed and can be found in Appendix C. The fee schedule takes into account individual and business clients specific needs.
For businesses, pricing will be in the hourly rate of $55, in line with other established accounting services and what other types of professionals charge.
Personal/household tax preparation and filing prices are a function of the forms and schedules involved. Generally there is a base charge ($50-$125) plus extra for each schedule ($10-$15). Personal consulting (or other non-tax filing services) will be priced out at the $25 hourly rate.
Service and Support Philosophy
"Keeping An Eye on Your Dollar"—A tag line, yes, but by giving careful consideration to customer responsiveness, Marcus' goal will be to meet and exceed every service expectation of its accounting services. Quality service and quick responsiveness will be the philosophy guiding a total quality management (TQM) approach to Marcus operations in its benchmark Customer Care Advantage program.
Promotion Strategy Summarypromotion Strategy Summary
Promotion strategies will vary depending on the target market segment. Given the importance of word-of-mouth/referrals among all market segments when choosing an accountant, efforts are designed to create awareness, stimulate trial, and build referrals. A cost-effective campaign, focused on direct marketing, publicity, a customer reward program, and advertising is being proposed.
Marketing Plan
New Business Segment:
A direct marketing (direct mail) package consisting of a tri-fold brochure, letter of introduction, and reply card will be sent to a list of new businesses in Market County. This list can be obtained from International Business Lists, Inc. (Chicago, IL) and is compiled from Secretary of State incorporation registrations, business license applications, announcements from newspaper clippings, and tax records. The letter introduces Marcus Accounting, stresses the importance of having a good accountant to the success of the new business, provides information on services and what sets it apart from other accounting services, and includes a promotional offer—the opportunity to sample the services for free (a one-month bank reconciliation, up to 200 checks).
Approximately ten days to two weeks after the mailing, a telephone follow-up should be conducted, to make sure the brochure was received, whether the client has any questions, or would like to schedule an appointment. Approximately 50 new businesses would be targeted.
Established Small Business/Home-Based & Self-Employed Segment:
A similar direct mail package will be sent to a select list of small businesses, home-based businesses, and self-employed. The letter will emphasize a slightly different aspect than for new businesses; established businesses may already have a relationship with an accountant, so the focus of the letter is on the differentiation of Marcus Accounting—what Mary Beth Marcus offers that others don't.
The list of established small businesses/self-employed (contractors) can be compiled from local directories, while a list of home-based businesses/self-employed can be obtained from Direct Media, Inc. (Greenwich, CT). Approximately 250 existing businesses would be targeted.
It is recommended that the mailings be made over a period of several months—not all at once— so that proper follow-up telephone calls can be made.
A customer/prospect database can be developed in addition to the purchased lists. Monitoring the local newspapers for announcements about new businesses in the area will provide a steady influx of new names. These can be added to the database, and the business mailed the brochure and "new company" letter.
Marcus Accounting can also consider developing a one-page newsletter to be mailed quarterly to customers and prospects in the database. The newsletter can be used to update clients on accounting and tax-related developments, but also serves as a reminder of what sets Marcus Accounting apart from other accounting services—being a financial "partner" and "keeping an eye on your dollar." Business and recordkeeping tips are always valued, and friendly reminders to clients to pass the newsletter along to their friends and colleagues will literally "spread the word" about Marcus Accounting. The newsletter can be produced in-house and for the cost of paper and a stamp creates a lot of goodwill among customers and prospects.
Networking - Attorneys and Bankers
A direct mail effort will also be targeted at the approximately 150 attorneys and bankers in Market County, as they routinely come into contact with businesses and individuals needing accounting or tax-related services. The letter introduces Marcus Accounting, and along with information about services, etc., asks the recipient to consider the service as a possible referral. Several brochures would be included with the letter for the recipient to hand out to his/her customers.
Publicity and Public Relations
A news release will be sent to area newspapers and magazines announcing the launch of Marcus Accounting.
Mary Beth Marcus may join the Market County area Chamber of Commerce as a means of networking in the community. She may also make herself available for speaking engagements at other community or civic organizations. Becoming a sponsor in a community event (Festival of Spring, County Fair, Autumn Fest, various parades, bloodmobiles, etc.) is a low-cost way of increasing awareness and building goodwill in the community.
Customer Reward Program
As a means of building business by word-of-mouth, present customers should be encouraged and rewarded for referring future customers. This can be accomplished by offering a small "rebate" ($10-$15 or equivalent gift) to current customers who successfully recruit a new customer. In addition, all new tax preparation clients receive a Marcus Accounting coffee mug when they pick up their returns. Since the 1998 tax season is underway, the coffee mug giveaway would take place in 1999.
Advertising
Advertising is utilized primarily to attract new consumer and home-based/self-employed business clients for income tax preparation services. It also serves to build awareness and name recognition of the company in general—important for word-of-mouth referrals ("Oh yes, I've seen that company's ads before.")
Market County Shopper/Sunday Shopper Market County Shopper/Sunday Shopper—advertising in this Wednesday and Sunday primarily classified newspaper reaches over 33,000 homes and businesses in the county twice each week. A 12-week schedule (24 insertions) commencing early in January and running through the middle of April coincides with tax season when the need for professional accounting help is most acute. Marcus Accounting can use its business card as creative, and can be placed under the "Services Offered" section of the display/classified ads. A six-week, every-other-week schedule (12 insertions) is also proposed for the fall to promote end-of-year tax planning and bill paying for seasonal residents.
Accounting services typically advertise only during tax season, so the earlier schedule will help set Marcus Accounting apart from and ahead of the rest.
Yellow Pages—Ameritech PagesPlus, Greater Market County Telephone Directory. Research indicated that new residents or people who don't have many personal acquaintances to ask about accounting services will look to the Yellow Pages to establish a list of potential accounting services to call. Even a small 2" × 2" boxed ad can create awareness and attract the desired target client, above and beyond the ability of a simple listing to do so. Ameritech Yellow Pages covers the relevant market area, delivering over 30,000 copies to residents and business. Midwest Directories covers greater Market County, with a circulation of 90,000, but is considered a second-tier directory to Ameritech.
Telephone Book Cover—A business cardlike ad on the plastic cover which is placed over any telephone book enables the business name/logo to be seen virtually 24 hours a day, 365 days a year. Covers are distributed biannually free of charge to residents and businesses in Market County.
Restaurant Placemats—Opportunities exist for a business cardlike ad to be placed on the paper placemats used in area restaurants (shelf-life of the ad is about six months), or for special (holiday) events taking place at a restaurant (1-off opportunities). An example would be getting on the Pizza Hut placemats (about 9,000 in six months), or getting on the special Lions Club "St. Patrick's Day" dinner placemats at the Village Restaurant (about 1,000 placemats for that event). Placemat advertising will reach area residents as well as seasonal/tourists.
Additional places to post flyers/business cards or for a business card ad include bulletin boards in public buildings (grocery stores, senior centers), and playbills for local theater groups.
Example Promotion Budget - 1998 & 1999
| Company brochure (2-color, 1,000 quantity, high quality paper) | $450.00 |
| Reply card (2-color, 500 quantity, card stock) | $150.00 |
| Lists (new businesses, home-based businesses) | $750.00 |
| Postage (mailing 300 businesses, 150 attorneys/banks) | $250.00 |
| Telephone follow-up ($1.50/call × 300 calls) | $450.00 |
| Public relations activities and sponsorships | $1,000.00 |
| Customer reward program | $500.00 |
| Newspaper advertising (Shopper) | $1,036.80 |
| Yellow Pages advertising | $621.50 |
| Telephone book cover advertising | $535.00 |
| Restaurant placemats (5 restaurants/10 events) | $1,650.00 |
| Miscellaneous flyers | $200.00 |
| Advertising specialties (give-aways) | $200.00 |
| Total for 1998 & 1999 | $7,792.80 |
Evaluation & Control Strategies
Objectives have been established for Marcus Accounting so that actual performance can be measured against them. Thus, at the end of 1999, Marcus should have:
- $36,000 in total revenuea
- 17 business clients
- 65 consumer clients
- Anticipate 90% customer retention (not measurable for first year)
Each subsequent year, new objectives will be set for these benchmarks, and actual performance will be measured against them. If actual performance falls short of objectives, investigation will be made into the cause, and plans adjusted accordingly.
In addition, it is recommended that Marcus Accounting keep track of the source of all new clients ("Where did you hear of me?") in order to measure the effectiveness of each type of promotion. Each subsequent year's budget should adjust spending toward the types of promotion that are accounting for the most new clients.
Customer satisfaction is most directly reflected in the year-to-year customer retention percentage. All lost customers should be investigated to find out why they left. A customer satisfaction survey may be considered after three to four years in the business.
Appendix a -Appendix a - Appendix a - Resume of Ms. Mary Beth Marcus
Olsten, Manpower, Officeteam, Accountemps Employment Agencies
Appendix B - Example Promotional Materials
Appendix C - Example Fee Schedule
