History of CPA Firm Marketing

Editor’s Note: This week, we proudly present a guest post by Marc Rosenberg – a fascinating quick tour through the history of CPA firm marketing. This is in honor of the annual Association for Accounting Marketing (AAM) Summit taking place next week in conjunction with the AICPA ENGAGE Conference in Las Vegas. (The founding of AAM in 1989, by the way, is a key milestone on the timeline.) If you plan to be at the conference, be sure to check out sessions by Rainmaker’s Adelaide Ness and Scott Moore. Meanwhile, enjoy the article!


Sir Winston Churchill said: “Those who fail to learn from history are doomed to repeat it.” Read the list below and see if your firm has learned from the many milestones in the evolution of CPA firm marketing.

This list consists of innovative practices in marketing as well as historical dates and milestones. They are roughly in chronologic order. However, when dates are given, it mainly means the point in time when CPA firms began to commonly observe these practices, not when the practice was first introduced.

In the beginning…

All firms were somewhat homogeneous, with one local firm indistinguishable from the next. (Some would say this still hasn’t changed too much). Competition for client and staff was virtually nonexistent. The profession was considered collegial, a “gentlemen’s profession.” CPA firms served as a gateway for many children of traditionally blue-collar families to make the jump to the white-collar world.

The sole emphasis of a CPA’s activities in the historical model was placed on technical excellence: debits toward the window, credits toward the door, wear your green eyeshade and keep your pencil sharp. If you did these things well and built a solid reputation for yourself and your firm, everything else would take care of itself.

Then things started to change

  1. In 1977, the case of Bates vs. the State Bar of Arizona served as a major turning point for all professional services. Prior to Bates, CPAs, lawyers and other professionals were widely prohibited from soliciting clients for business and advertising. The Supreme Court, in ruling on the Bates case, removed these prohibitions. CPAs were very slow in adapting to this new freedom. Indeed, one could argue that many local firms today still haven’t adapted and do very little marketing and practice development. But the more aggressive, better managed firms were quite active in marketing their firms, just like all other businesses. This continues today.
  2. One of the biggest and most immediate fallouts of Bates was to spawn a major new industry: the paper newsletter. Now free to advertise and solicit business, CPA firms in droves purchased expensive newsletters, written by the their providers, with the name and logo of the CPA firm imprinted on the canned newsletter, making it appear to recipients that the CPA firm wrote the newsletter.
  3. In the early 1980s, what became known as the MAP (Management of an Accounting Practice) movement emerged, causing cynics to say: “Oh, you just discovered this now?” MAP conference, MAP groups and MAP publications became ubiquitous. Partners couldn’t get enough of this new Kool-Aid. The essence of MAP was that CPA firms are just like any other company and should be run like a real business instead of a collegial gentlemen’s club that runs itself because all partners are trusted and relied upon to manage themselves. Real businesses practice the following:
  • Central management.
  • Marketing.
  • Planning and goal setting.
  • Performance-based compensation for all officers.
  • Focusing on developing a great staff vs. the gladiator-based “up or out” philosophy.
  • Human resources function including recruiting and leadership development.
  • Accountability.


The major impact of the MAP movement on marketing was to formally introduce several trailblazing innovations:

  • It’s no longer effective for CPAs to sit back and wait for new business to come in unsolicited. They must do things to make it happen.
  • In addition to practice development (CPA firm lingo for selling), firms began to create marketing departments that organized the firm’s growth activities and worked in concert with individual practice development efforts.
  • A major new duty to the standard job description of a partner was added: bring in business. At the more progressive firms, partners were held accountable for bringing in business.
  • As firms began to embrace the critical importance of revenue growth, partner compensation systems began to heavily skew the allocation of income to those who were the best at bringing in business, often – and mistakenly – to the exclusion of virtually all other partner duties.


  1. Starting with the early 1980s, as partners began doing practice development, they pursued referral sources aggressively. Networking with bankers was all the rage and it worked. But as many of us know, the banking industry changed and turnover of bank officers skyrocketed, thus rendering bankers less effective referral sources.


  1. Despite Bates, the term “marketing” was synonymous with selling for most CPAs. In the early 1990s, this started to slowly change. Firms woke up and began to understand that marketing is creating the at bat and selling is hitting the ball. That marketing is all about generating name recognition and creating opportunities to sell or close the sale. However, until the dawn of the 21st century, marketing at CPA firms consisted primarily of individual selling efforts by partners. Firms relied heavily on rainmakers (and they still do today, but not as much).


  1. In the mid-1980s, a major new term was introduced (I believe by one of the first great, national CPA firm consultants, Don Istvan) at MAP conferences: Type I vs Type II services:a. Type I services are those that clients need but don’t necessarily want. Examples: audits required by a bank or the SEC; tax returns required by the IRS. Most clients wouldn’t have audits or      tax returns prepared if they weren’t required. To a great extent, these compliance services don’t directly help improve clients’ businesses.
    b. Type II services are those that clients both want and need. Two main types:

i. Those strongly related to a compliance service. Here’s a classic, common example: The CPA prepares a tax return for a client. The tax return is hand delivered instead of mailed so that
the CPA can explain the return and identify ways to do tax planning, thereby reducing the clients’ tax bill and identifying other services that the firm provides such as wealth                                            management.

ii. Those that are stand-alone consulting. Examples: Recruiting a controller, technology consulting, M&A work, estate planning. These services improve clients’ businesses and solve their problems.

  1. In the mid-1980s and early1990s, CPAs added an important word to their dictionary – consulting, which essentially replaced Istvan’s term “Type II” services. CPAs began to understand that they were not in the accounting business, but instead, in the business of satisfying their clients’ increasingly diverse needs.


  1. As part of CPA firms’ metamorphosis towards consulting, it was only natural that they would change their tagline to “CPAs and Consultants” instead of just “CPAs.” CPAs. This tagline appears on their brochures, web sites, business cards and all other collateral material.


  1. In the 1980s, firms began developing specialties and niches. This might mean a focus on one or more industries such as real estate or health care. It might also mean a focus on a specialty service such as technology, business valuations, litigation support or estate planning. For some firms, it may mean both.


  1. Adding consulting to CPA firms’ service portfolios caused them to focus increasingly on a powerful marketing tactic – cross-selling – the sale of different services to existing clients.


  1. In 1989, the Association for Accounting Marketing (AAM) was formed. AAM is a national trade association and a one-of-a-kind network of marketing, business development and growth strategists. The association provides education, community and resources for accounting firms, CPAs, consulting firm marketing and sales professionals, partners, firm administrators, and representatives of businesses offering marketing-related products and services to the accounting profession.
  2. Birth of Accounting Associations. Beginning in the 1990s, associations of CPA firms were created. The basic premise of these associations is similar to the United States’ motto, “e pluribus unum”: “One out of many.” Since virtually all CPA firms are local, firms joining an association would benefit by a loose association with dozens of other firms, not just in the U.S, but internationally. This gives the typical local firm a big-firm presence. From a marketing point of view, this gives member firms:
  • Expanded geographic coverage. If clients of a local CPA firm opened offices halfway across the country or internationally, their service needs would be satisfied by an association member in that location. A great cross-selling opportunity.
  • Access to the technical expertise of dozens of firms instead of firms relying solely on their own knowledge. Again, a great cross-selling opportunity.
  • Knowledge of best practices at dozens of other CPA firms obtained by attendance at frequently scheduled, association MAP conferences.
  • The common thread of the above is to enable a firm to avoid living in a cocoon.


  1. Around 2000, firms began creating sales commission/bonus plans for staff to bring in business.


  1. In the late 1990s into the mid-2000s, the consolidator movement Non-CPA firms American Express, H&R Block and CBIZ bought hundreds of accounting firms. A term was coined during this movement that is still used today – one-stop shopping, the concept of going to one CPA firm for a multitude of financial and consulting services (audit, tax, consulting, investments, payroll, insurance, mortgages, travel plans, strategic planning, technology consulting, etc.) instead of going to a separate firm for each service. This movement served to ramp up the concept of cross-selling.


  1. Financial services (alternatively called wealth management). In 1988, the AICPA voted to allow CPA firms to accept contingent fees and commissions related to their sale of securities and other financial products to their clients. Prior to this, the AICPA banned these activities. Sales of financial products to attest clients are still not allowed.

As has been the case with many innovations in the CPA firm industry, firms were slow to react. But by the mid-1990s, coinciding with the consolidator movement, the sale of financial services began to catch on in earnest.

Today, roughly one-third of all CPA firms engage in the sale of financial products. Many of these earn more money in this area than they do in their traditional accounting practices. The introduction of this service created one of the largest cross-selling opportunities in the history of CPA firms.

The success of financial services was fueled by a creative promotional strategy. CPA firms looked at themselves and realized that:

a. They are their clients’ most trusted advisor, more so than lawyers, bankers, investment advisors and other professionals.
b. They could exploit their unquestioned, impeccable image and reputation of being objective.
c. If clients hire CPAs for accounting and tax and trust them as general business advisors more than anyone else, they would feel comfortable entrusting the management of their money to their CPAs, even more than traditional investment companies.

CPAs have performed admirably in wealth management, often better than the traditional big houses.


  1. The Internet, considered by many to be the greatest invention of the last 100 years. Widespread usage of the Internet began in the early to mid-1990s, fueled by the development of a Windows-compatible browser and the removal of restrictions on the use of the Internet to carry commercial traffic. Today, the use of the Internet to promote, advertise and sell is ubiquitous to virtually all organizations and institutions.


  1. Email. Its evolution largely paralleled the Internet. Email is simply the exchange of messages between people. Email is commonly used to send messages that promote services and products, especially blogs.


  1. Sarbanes-Oxley Act (SOX) in 2002. Legislation prompted by the Enron/Andersen debacle of 2001, SOX almost overnight created a new multi-billion-dollar service almost exclusively for the 25 largest CPA firms in the U.S. But this had a huge upward revenue impact for firms below the Top 25 due to the ensuing “trickle-down effect”: The Top 50 did not have the capacity to handle this influx of major new work and revenue, so they paid less attention to their opportunities to serve smaller clients. Smaller clients of Top 25 firms were huge clients to those below the Top 25. As a result, revenues of these smaller firms swelled and propelled the U.S. CPA firm industry into what was known as the “Golden Age” of the accounting industry: Annual revenue increases from 2002 to 2007(right before the great recession) were the highest in history, with firms posting revenue increases at or above the 10% level. SOX work is perhaps the single biggest cross-selling boon to ever hit the accounting profession since perhaps the creation of the SEC in the 1930s.


  1. Mentoring. Prior to the early 2000s, this term was not in the CPA’s dictionary. But as the difficulty in hiring accountants became dire, firms realized that if partners and other senior personnel proactively worked with staff to retain develop and coach them, staff retention and performance would be enhanced.

Mentors take mentees (or protégés) under their wings, over an extended period, to give them advice on how to succeed at the firm, counseling them on where they stand and what they need to do to get ahead.

A common mentoring activity is the development of practice development skills. One common activity is for partners to bring staff along on sales calls. This gives the mentee the opportunity to “see a pro in action” and learn from these observations.


  1. Teamwork and moving away from the term “book of business.” One of the most significant growth practices orchestrated by many firms (more larger than smaller firms) is to move away from a near-total focus on individual selling efforts and rainmakers (who are always in short supply) to grow revenues and move to a team or firmwide approach. Some of the many team practices are:
  • Team selling – the lead originator brings along a senior member of the firm who practices in a different discipline. A classic example is the audit specialist bringing along as tax expert on a sales pitch.
  • Institutionalizing clients (a practice more common with larger clients than small) – servicing clients by ensuring that they have “multiple touch points” in the firm, getting them to rely upon and value several firm members instead of relying on just one. This answers the question: “If you should suddenly leave the firm, will your clients stay?”
  • When someone is strategizing how to make inroads with a prospect, he/she taps into the resources of all firm members to see if anyone has a contact or an “in” to make a “warm” introduction. This includes pooling and tracking of referral sources.
  • The common thread to all the above is “no Lone Rangers” – people who hoard client relationships and don’t allow access to their clients by other firm members.

A by-product of the team approach is a movement away from using one’s “book of business” as virtually the only way to measure a partner’s overall performance. Don’t get me wrong – bringing in business and managing a large client base will always be an important partner performance measure. But “book of business” connotes the notion that clients are “owned” by individual partners instead of being owned by the firm. It is a term that is anti-team or anti-firm. The MP of a large firm once told me: “We stopped measuring book of business because we don’t want our partners always looking at their own metrics.”


  1. Mergers as a strategy to achieve revenue growth. Since the mid-2000s or so, the worldwide accounting industry – not just in the U.S. – has experienced merger frenzy. This has been fueled by:
  • Baby Boomer partners approaching or reaching retirement age without enough younger personnel to replace them.
  • A terrible shortage of qualified accountants.
  • CPA firms are weak at succession planning and leadership development, mainly because (a) excelling in these areas is not a significant factor in partners’ compensation, (b) partners are not trained in leadership development and mentoring and (c) partners either consciously or subconsciously believe that their exit strategy will be to eventually sell out, so they don’t expend much energy to remain independent after they retire.


  1. Social media. This emerged in the early 2000s, starting with LinkedIn. With the proliferation of social media, CPA firms were provided with a new way to promote their firms. The jury is still out on the effectiveness of social media for CPA firms, but more on this in the future.



Are you doing these things at your firm?

  1. Understand the difference between marketing and selling.
  2. Complacency kills a firm; never be satisfied with what you have.
  3. Solicit new business; increase your at bats to maximize your hits. Stop acting like the Bates decision never happened.
  4. Differentiate your firm from others.
  5. Actively and tastefully promote your firm to clients, prospects and referral sources. Use social media effectively.
  6. Be sure to regularly get your name out, including the use of blogs and newsletters.
  7. Run your firm like a real business. This includes…
  8. Create and manage an active marketing function.
  9. Establish accountability by partners to bring in business.
  10. Train staff in practice development with mentoring and sales training.
  11. Aggressively and professionally cross-sell your services.
  12. Develop consulting services to work in tandem with compliance work. A great way to cross-sell.
  13. Practice one-stop shopping.
  14. Offer financial services to your non-attest clients.
  15. Specialization.
  16. Niche marketing.
  17. Join AAM (the Association of Accounting Marketing).
  18. Join a CPA firm association to avoid living in a cocoon and to expand your geographic and technical footprint.
  19. Use marketing to drive selling opportunities instead of relying exclusively on individual efforts (rainmaking) to grow the firm.
  20. Team selling and servicing of clients.
  21. Mergers to supplement organic growth.

Next Steps

If you are considering ways to establish and grow relationships with practice leaders from around the country, join us in Atlanta this June 18-20 for our annual SuperConference to meet and learn from some of the industry’s top growth-focused leaders, consider joining a Rainmaker Niche Community, or contact us for a complimentary consultation on how Rainmaker can help enhance your firm’s growth culture. The Rainmaker Companies can help you Grow Your Firm or Grow Your Practice.

Marc Rosenberg- Management Consultant to the CPA Profession