Why a Marshmallow Is Key to a Better Tax Season
We’re in the full force of busy season and there is a significant amount of business to be had in a short number of weeks. The business is good not just for tax accountants, but also for bookkeepers who post and balance the supporting numbers, and consultants who troubleshoot and keep the systems running where those numbers are contained.
In other words, we have the attention of our clients in a BIG WAY this time of year compared to most other times of the year. And that should get our attention.
One or Two Marshmallows
There’s a famous study in the field of psychology called the Stanford Marshmallow experiment. You might have heard about it; the study makes the news periodically. In 1972, Walter Mischel, a Stanford University psychologist, offered very young children a choice. They could have one marshmallow right now or two later.
After presenting the children ages four to six with their two options, the researcher left one marshmallow on a plate right in front of the child and left the room. If the marshmallow was still there when the researcher came back in 15 minutes, the child would get to eat two.
You could imagine the angst of these children who tried so hard to wait for the bigger reward. They closed their eyes to divert their attention. They tapped the table. They squirmed. A small percentage ate the marshmallow immediately.
One-third of the 600 children studied were successful at “delaying gratification,” which was the intent of the study. They got to eat two marshmallows.
The important result of the study was the longitudinal outcome. They followed the children decades later into their adult lives and discovered that the ability to wait longer when they were age four predicted higher success in the subjects’ adult lives and careers.
So what does that have to do with tax season? Actually, there is a double meaning.
It’s much easier to get a client or prospect in your office at tax time than it is at any other time of year. While your clients’ focus is on accounting, and metaphorically speaking, the one marshmallow is about tax compliance, it’s the perfect time to offer them another marshmallow.
The problem is, we don’t do that because we’re in too much of a hurry. We’re focused on the one marshmallow ourselves, but if we just spend a little more time, we have a chance to get a second marshmallow, just like our clients.
During busy season, we each have a choice about how we handle the attention of our clients. We can take care of the immediate problem, which is to file the taxes, get the numbers right, or get the system to produce the numbers, and move on to the next client.
If you fall into this group, you can count on paying more in marketing in the off season for your clients’ and prospects’ attention. You can count on starting to have cash flow problems in the off season. You can count on lower overall revenues and lower revenues per client. And, worst of all, you can count on clients who treat you as a commodity service, because you didn’t take the time to build their trust and tell them what you can truly do for them.
The Forward-Thinking One-Third
Our second choice is to take the extra time to dig deeper, find out more about the client, and uncover their long-term needs and wants. Here are five questions you can adapt and add to your client meetings this season:
1. Where does your passion lie when it comes to your business? You can then tell them about your passion.
2. What financial skills are you looking to build in yourself, your team members or in other areas of your business this year?
3. What one financially-related action item could you do right now to move your business forward the most?
4. How are you receiving controller or CFO-level financial advice currently?
5. Would you be open to a conversation about some profit-increasing opportunities that I see for your business?
The accounting professionals who take this route will increase their profits, smooth their year-round revenues and cash flow, and maximize the lifetime value of their clients. Their clients will even be better off too.
By sharing all of your valuable financial skills with your clients, you might even prevent a business or two from going out of business.
Now that’s a big marshmallow.