By Jason Staats — Oct 20, 2021

My Favorite Accounting Firm Marketing Story

How is this for a marketing success story:

Grew his email list from 3 to 215
$1.5M+ in new revenue
50-60 new ongoing tax clients
In 12 months
In a specific niche

My favorite part? It was run by an accountant, from a spreadsheet.

I sort of stumbled into it, for sure, but once I discovered there was an opportunity here, I wouldn't say I've doubled down on it. I've like, 10x'd down on the idea of this niche.

An Unlikely Protagonist

Chris Wittich is a CPA in Minnesota - a partner among many others at his firm. When COVID kicked off, Chris was appointed as the technical lead on new legislation. At the time he didn't have a specific industry specialization, but COVID was about the change that.

Before the pandemic, Chris had a single salon client.

I've never been to a salon in person. I go to Great Clips, and they, you know, zip it all off.

But he did have a client who consults with salon owners, and when the CARES Act was signed into law, Chris became an overnight celebrity for an unlikely audience.

Thanks to this consulting group, Chris found himself in front of salon owner after salon owner answering the same questions. A great problem to have, the trouble was it came at a time when every client wanted his ear.

The solution: start a group email so he only had to answer each of the questions once.

Or so I thought.

The list started with 10 salon owners Chris had been emailing with. The first email he sent was on April 28th, it spelled out:

How the PPP works
Documents to have ready to submit an application
How to manage your spending across 8 weeks
A spreadsheet to help track spending

It was a firehose of no-nonsense, timely guidance at a time when business owners were clamoring for any sense of certainty they could find.

In the very first email I said I'd charge $250 an hour to help with this, which in hindsight, I regret.

The second email went out on May 1st, as rules were quickly evolving. The email linked to a generic blog post on their firm's website, and spelled out COVID relief's current state of flux. Spelling out the state of affairs, but letting salon owners read between the lines to make decisions for themselves.

Something Borrowed

Email updates continued to go out every 10 days or so, and eventually, Chris approaches the consulting group about offering a webinar for salons.

I basically go to them and say: do you guys want a webinar too? I do a webinar for our firm, which is generic. I can do a version for you that you can blast out to your salons, it's free, and instead of using generic terms I'll use salon terms.

He was able to pare back the content to only what was relevant to salon owners. They didn't need to worry about rules for franchisors, being over $2M+, or having hundreds of employees. The result was a high-context presentation that was a small side-step from the generic content they had already assembled.

The client list wasn't his, and the source content was never intended for salon owners.

The Tech Stack

This is where marketers pump their email marketing software or a novel tool that drove virality. This marketing campaign, well, this ain't that.

I've now sent 27 emails in this chain, and I just keep replying. I'm able to refer back to previous emails, and add to that advice. The last line of each email says 'if you want friends to be added to this email, just let me know.' Or 'if you want to be removed from this list, just let me know and I'll take you off.'

The email marketing software? It's Outlook.

The contact list? It's kept in excel.

The unsubscribe button? Well, just reply to Chris if you want to be removed (no one has asked to be removed yet).

It's the sort of feel-good, old-thymey story of being a human winning out over the algorithm. Just an accountant and his spreadsheet against the world.

The marketing department?

We hold a regular marketing meeting and put on a list all the work we think we're going to bring in. My salons overwhelmed the list and we had to change how we went about those marketing meetings.

The ERC Opportunity

The American Rescue Plan opening up employee retention credits (ERC) to paycheck protection program (PPP) borrowers turned out to be gasoline on the fire.

There's probably 215-220 salons on my list now, and to-date we've probably done $650k in ERC projects for these owners. 99% are new clients for the firm. Some of them will be new tax clients, some of them will not be new tax clients. I'm not totally sure why you would stay with an accountant that was unaware of your $150k in ERC or unable to calculate it, but I haven't had to chase anyone

While the nuance that came with ERC interpretation was enough to ward off most tax professionals in early 2021, Chris' team continued to put out generic guidance, and augment that guidance slightly for salon owners.

Salon owners had their own set of staffing challenges to navigate, and how staffing fit into the PPP & ERC model was an important pro-active planning consideration. There was real money to be unlocked by getting it right, Chris' job was to open their eyes to the opportunity.

The fish are leaping into the boat.

The Long-Term Impact

Having had a taste of niche work, Chris now insists he will never go back to being a generalist. It was an experience catalyzed by perhaps a once-in-a-lifetime opportunity for accountants (let's hope, anyway), but one that has opened his eyes to the network effects of becoming a niche expert.

It's certainly changing the direction of my firm a way that's interesting. We have about 100 people, a $15M firm, and I bet I'll do $1.5M in ERC on new salon clients.

In the Q&A that followed our session, we dug further into finding your own niche, and the common roadblocks that keep us from thinking we could become an industry expert.

Extended Q&A

[Jason] So you had one salon client before all of this. Now your salon clients think you're a salon specialist. What do you even know about salons? What gives you the audacity to do this?

[Chris] That's a very good question. I've never been to a salon in person. I go to Great Clips, and they, you know, zip it all off. They needed help, and that's where it started. For the most part, all of us on this screen are equally capable of doing salon work. It's not complicated. They do not qualify for the tip credit, that's key to understand...some of it comes from the discussions I've had with the first couple of clients. I spent an hour figuring out with a couple of people what's going on, then the same thing comes up constantly.

So now I know some of the terms they use. Like I did not understand how the employees were paid on commission, and now I do. All the salons do it the same way, or they have booth renters. I didn't know what the hell a booth renter was 18 months ago, but I do now...I didn't know what I was doing in the first place, but when you look at it most of them are S-Corps, they have 1 owner, or bring in small 5 percent shareholders. It's concepts that are not difficult for anyone to understand, and at the time they needed help.

[J] A mistake I've made that I suspect people can relate to is we talk about doubling down on a niche, and part of that mental process for me is: who are the people that will run it? We need to send them to conferences. We need a deep understanding of XYZ, and what I'm hearing is maybe that's necessary for some niches, but definitely not for all?

[C] Sure maybe if it's oil & gas. But the tax situations for these, there's nothing to them other than remembering they don't get tip credits. But I ended up picking a couple of team members who have been to a hair salon before in their lives, and said 'do you want to be busy all year with salon work' and they both said 'yeah sure that sounds like fun, it would be good to have a niche specialization.' But they both have a generic understanding of tax law.

I started in the tax department and am very technical, but they [the team] are not remotely technical from a tax standpoint. They understand the accounting better than I do, and they can work through the cleanup that salons require, but you simply need to learn how to speak salon-speak.

[J] So the email list is the clickbait headline here, but the force-multiplier it sounds like was the consulting group. You had something that made what they do more valuable. You can do a webinar, and they say absolutely. It sounds like that was a big driver.

[C] I ended up charging them for my time, and they didn't care...we would have a lot of meetings before the webinar to talk about the topics so they were educated prior to the webinar. They're the ones facilitating the Q&A, so they wanted to know beforehand. So they would listen to my firm-wide webinar, then we would have meetings to talk through it. So I ended up billing all my time, but they provided this content for free to their clients, and they have helped a ton of clients as a result

With the first consulting group being a big success I've since connected with a couple more companies that do consulting with salons and offer salon-specific webinars to their client lists and have plans to seek out more opportunities like that in the next year.

But basically, I turned them & their employees into the evangelists that go out into the world and send me new clients. So their employees, their trainers, their coaches, their CPE instructors tell every salon they run into, "oh you gotta go talk to this guy, he knows about salons."

So I'll get inquiries from people I've never heard of, and they go to instant-win clients. They say "I'm using you now." They didn't ask how much I cost, they simply say "you're my accountant now."

[J] If you're trying to go deeper with a niche, or get started with a niche, that sounds like a good place to start. Find a way to provide value to somebody who already has that network?

[C] Yeah. It's the 'one-to-many' approach. I started with a couple of people on my email list, but they passed it around to others. Just like I know a bunch of other CPA owners, if I run into some good technology I'm going to share it with people that I like. It sort of works the same way.

So thinking about the other places that salon owners go. Who are the people that routinely consult with them, or provide them products? That's a super way to turn somebody else into a good referral source.

I sort of stumbled into it, for sure, but once I discovered there was an opportunity here, I wouldn't say I've doubled down on it. I've like, 10x'd down on the idea of this niche.

[J] How many people do you have on the list now?

[C] About 215 or so.

[J] And how many do you think will be actual clients? Beyond just limited-scope ERC work?

[C] I think we'll probably end up with 56-60, maybe more annual tax clients. So I went from 3 to maybe 43. Something like that I think is reasonable.

It's a little hard to tell. There are a bunch we've done projects for, and they haven't clearly indicated they're going to be clients next year, and we haven't asked them either. Which may be bad on us, but I've got enough to do that I haven't chased or followed up with any of them yet.

[J] So you're playing hard-to-get.

[C] I'm playing busy-to-get.

[J] You said something that I have been really bad at, that most of us are bad at. Everyone puts out generic content, but often times we don't think about how we're a very small side-step from content for a specific group, that people will get way more engaged in, by simply paring it back and changing the vernacular a bit.

[C] Yeah. It's nominal changes. There's one of my staff who likes veterinary clinics, and we were looking at a firm in town that specializes in vet clinics. We went to their website and it said "you should bonus depreciate your assets." It was the most generic content, and in that case, he would claim it was for vet clinics. But it applied equally to every business.

So I was talking with this staff person about how he could do this. I think the same thing applies to salons. I'm giving them PPP advice - it's not any different than the PPP advice all of you are giving people, but I'm leaving out the items that don't apply to them, giving them less information...then say things like "if you're a booth renter, this doesn't apply to you." It's a few sentences of industry-specific wording, which I worked out quickly and I've never been to a hair salon.

It's just understanding their business, and their business model is not wildly complicated. Oil & gas or farming might have different tax rules, but salons, they have payroll, they pay rent, it's all the usual stuff.

[J] What's next? I think a lot of us have gotten better at this during COVID. We're learning how to avoid having all the same one-on-one conversations. Do you think about this now, for example, if an infrastructure bill goes through, is that something you build content around? Has it permanently changed how you approach these things?

[C] For sure. Even in my last email I told them my next email will probably be after the infrastructure bill passes. I told them there's going to be a tax bill in the fall, and there will probably be impacts for a salon.

Even if you don't think there are impacts for a salon, if they change the personal tax rate, well, persons own salons, so it changed. That's where you can take the idea of bonus depreciation and say it's worth depreciating the stations in your salon. Everyone's doing it, but if you say it that way, then it's tailored for them.

For me down the road I'll have info about the bill, I'll continue following up on ERC, and PPP2 forgiveness, which is the same set of things I've been saying for the last 8 months but they need to keep hearing it. I'll just keep telling them. I'm going to do more work with my referral partner that does consulting. I'm going to formalize how tax planning is done for salons when you bring on a shareholder, or selling your business, and we're going to put together packages that they're going to sell, that include my services.

Then I'm going to go to some of these CPE conferences they have. I'm going to go to one to listen to everything they say so I have a better understanding of the things they say. I think I understand them okay now, but I'm going to go to have a better hands-on understanding of what they're telling people.

Thanks to Chris for spilling the beans on how he discovered his niche! Follow Chris over on Twitter, and the full recording can be watched in my accountant community.