Accounting for Marketing Success
Is marketing worth the money it costs? There are ways to find out. As it already has in other business areas, accountability is fast becoming the watchword in CPA firm marketing. Partners or senior managers now demand cost-benefit analyses of their firms' marketing and media programs, just as they do for practice areas. And for the same good reasons: planning, future budget allocation and simply determining the most productive activities. Professionals frequently become frustrated with marketing efforts because they believe marketing is or should be a science with guaranteed results. In fact, it's more of a practical art that succeeds best when firms are willing to take calculated risks. Careful tracking can enable a firm to get a better grasp of which marketing risks are most likely to pay off. This article describes how our firm attempted to unravel the mystery of marketing accountability, showing the steps our firm used to budget, track and analyze marketing activities. As the firm's marketing director, I oversee a staff that includes two marketing coordinators, an information specialist and a database coordinator, but many of the firm's strategies can be adapted by other practitioners. STEP ONE: FORMALIZING THE MARKETING BUDGET What percentage of revenues should be allocated to marketing? Choose according to firm needs. AMG association involvement; and certain subscriptions. All marketing department personnel salaries are included. We do not include charitable gifts, even if they are client-related. To determine each department's or industry's marketing budget, we review the area's revenue and allocate a percentage to marketing. Start-up areas and industries get a much bigger slice of the pie than do mature ones - in some cases, up to 10% of revenue. Others get from .25% to 1%, and we reserve a small amount for special opportunities. The remainder goes to firmwide marketing expenses. We budget for various AMG offer advice; and give project cost estimates. …