2018 Accounting and Financial Services Research Released
The 2018 High Growth Study took a close look at the accounting and financial services industry. The Hinge Research Institute surveyed 269 firms, a majority of which provided detailed financial data. These firms had more than $150 billion in combined revenue and employed more than 645,000 people full time.
Now in its third year, the High Growth Study encompasses all professional services – accounting, architecture, construction, consulting, engineering, finance, legal, and technology. The companies ranged in size from micro firms with less than $1 million in annual revenue to large companies generating $50 million or more each year—and everything in between. Firms offering accounting and financial services represented more than one-quarter of the 1,000 study participants.
Top executives—including company CEOs and presidents—responded to the survey, providing insight into growth patterns, marketing trends, competitive threats and more. Perhaps most important, the information they provided explains why some firms in the industry are growing much more dramatically than their peers, and what they are doing differently to bring about that growth.
Slowing Growth is an Ominous Sign
The median annual growth in revenue for accounting and financial services firms fell from 7.8 percent in 2016 to 6.1 percent last year – nearly a 22 percent decline. Indeed, the industry grew slower than all other types of professional service firms studied, lagging their nearest competitor by more than two percentage points. It was also the only industry that failed to post at least an 8-percent increase in 2017.
Meet the High-Growth Firms
There is a group of companies in each industry that is having a very different experience when it comes to revenue growth, and the accounting and financial services industry is no different. Almost one in four companies (23 percent) are in an elite category that have seen revenue grow by 20 percent or more annually for the last three years. We call these the high-growth firms. Among them, the median annual growth rate is more than 56 percent, a sharp contrast to an industry where the majority of firms saw single-digit growth last year and almost 17 percent saw no growth at all.
As a group, most professional services industries saw growth slow, with the median annual revenue across all industries in the study falling by 9 percent, from 10.2 percent in 2016 to to 9.1 percent last year. There were also major differences in performance between industries. For example, technology companies led the list with an 11.4-percent increase in 2017, even as the industry itself saw a 20-percent drop from the previous year.
There was one notable piece of good news: Companies across all industries that derived the majority of their revenue through government contracting grew by 13.3 percent, a whopping 87 percent year-over-year increase.
One mission of the 2018 High Growth Study is to study how these firms think and act in order to determine what they do differently—and how they pile up massive growth in revenue. This year’s survey provided answers.
High-growth accounting and financial services firms see and react to the competitive landscape very differently than no-growth firms in the industry. For example, they are focused on fewer business threats than their no-growth cousins, most of which involve the changing and unpredictable marketplace.
The high growth response is to conduct research to counter unpredictability (high-growth firms are 41 percent more likely to do so), implement training to address skills deficits and invest in marketing to gain visibility for their in-house experts. On the other hand, no-growth firms have concerns in a larger number of areas, and their response is often to offer more services in more geographies.
High-growth accounting and financial services firms are more likely to specialize. They are more likely to offer specialized services, solve specific problems, serve in a specific role or offer specialized use of technology. They are less likely to offer specialization by industry.
[bctt tweet=”#Highgrowth #accounting and #financialservices firms are more likely to #specialize” username=”HingeMarketing”]
Effective Marketing Techniques
For the first time in 10 years, we found that high-growth firms outspent their no-growth peers in marketing. In some cases, the difference was pronounced. One in five high-growth firms are investing 20 percent or more of their annual revenue in the marketing budget. In the accounting and financial services industry, high-growth firms are three times more likely than no-growth firms to spend at least 10 percent of their revenue on marketing.
[bctt tweet=”#Highgrowth #accounting and #financialservices firms are 3X more likely than no-growth firms to spend at least 10% of their revenue on #marketing” username=”HingeMarketing”]
High-growth firms also do traditional marketing differently. Despite similar adoption of traditional marketing practices, high-growth firms saw much more marketing impact. For instance, providing assessments or consultations was the most impactful traditional marketing technique for high-growth accounting and financial services firms, followed by networking at targeted events and pursuing industry awards.
High-growth accounting and financial services firms clearly enjoy greater impact from digital and content marketing techniques. These firms are 50% more likely to use any given digital technique and saw higher levels of impact from 9 of the 10 techniques examined.
By studying what works for the fastest growing firms in accounting and financial services, your company can gain insight into how to best formulate marketing, sales and revenue strategies. Hinge makes the 2018 High Growth Study Accounting and Financial Services Executive Summary available free. Download it today.
- Download the Executive Summary of the 2018 High Growth Study, Accounting and Financial Services Edition and learn what propels high-growth firms into the stratosphere.
- Learn how to uncover your firm’s true differentiators with Hinge University‘s Differentiation, Positioning & Messaging
How Hinge Can Help:
Let Hinge help you create and implement a research-based strategy to increase your firm’s visibility and growth. Hinge’s Visible Firm® Program is the leading marketing program for professional services firms that want to market themselves like industry leaders. Ask about it today!
- Business Development Strategy: A High-Growth Approach
- A 10 Step Brand Development Strategy for Your Professional Services Firm
- Strategic Marketing for Professional Services
- Digital Branding for Professional Services
- 10 Essential B2B Marketing Strategies to Grow Your Professional Services Firm
- Digital Marketing Strategy for Professional Services
- Rebranding Strategies: A Step-By-Step Approach for Professional Services
- Elements of a Successful Brand 1: Brand Positioning
- The Top 5 Business Challenges for Accounting & Financial Services Firms
- Find Your Differentiator: 21 Ways to Gain a Competitive Advantage for Your Firm
- Elements of a Successful Brand 4: Brand Promise
- What Is the Cost of Video Production for the Web?