Why Most Tax Accountants and CPA Firms Underspend on Marketing—And How It Hurts Their Business Valuation

Most accounting firm owners readily invest in software, staff, and continuing education. But when it comes to marketing, the industry consistently lags behind other professional services. Study after study confirms what many observers already know: the typical CPA firm spends far less on marketing than the amount required to grow, differentiate, and maximize firm value.

This chronic underinvestment doesn’t just weaken lead flow today—it directly reduces firm valuation, shrinks deal multiples, and hurts succession outcomes for retiring partners.

Below is a deep dive into why this happens, how it shows up in the financials, and what forward-thinking firms are doing to reverse the trend.

1. The Accounting Mindset: Conservatism That Works Against Growth

Accounting is built on risk mitigation: accuracy, compliance, stability, and control. These traits are strengths inside the work, but they become weaknesses in marketing.

Key mindset barriers include:

• Fear of waste: Many partners assume marketing will burn cash without guaranteed returns.

• Preference for referrals: Firms believe referrals are “free”—ignoring lost opportunity cost.

• A belief that good work markets itself: True in 1995; not true in 2026.

• Underestimation of competition: Every niche now has 5–10 aggressive digital competitors.

This mindset keeps firms safe in the short term but stagnant in the long term.

2. The Referral Trap: A Hidden Obstacle to Valuation

Firms that rely on referrals experience:

• Unpredictable lead flow

• Concentration risk (a few referral sources)

• No scalable marketing engine

• A client base shaped by randomness, not strategy

When valuation experts analyze a CPA firm, one of the first questions they ask is:

“How do you generate leads?”

If the answer is “referrals,” deal multiples drop because:

• Referrals disappear after ownership changes

• Referral partners rarely transfer between owners

• There is no proprietary growth engine

• Buyer risk increases significantly

A firm without a predictable marketing pipeline becomes a high-risk acquisition, which reduces offers, reduces demand, and reduces price.

3. Lack of Specialization Means Weak Messaging and Low Conversion

Most CPA firms claim to be “full service.” But generalist messaging blends in, making marketing harder and more expensive.

Underspending keeps firms from:

• Building niche websites

• Producing targeted content

• Creating vertical-specific case studies

• Running specialized ads

• Standing out in search results

When a firm fails to specialize—and then fails to communicate specialization—their conversion rate suffers, forcing even more marketing effort that they never fund.

This cycle leads to small pipelines, lower revenue growth, and ultimately a lower valuation.

4. Outdated Websites and Weak SEO = Invisible Firm

A surprising number of accounting firms still use:

• One-page websites

• Poor mobile experience

• Homepages that look like 2010

• No ranking for buyer-intent keywords

• No lead magnets or automation

• No Google review strategy

Because most prospects research online first, a weak digital presence creates:

• Fewer inbound leads

• Lower perceived value

• Brand distrust

• Reduced pricing power

Buyers look at web presence as a proxy for firm health and scalability. Underinvestment here directly hurts multiples.

5. Underspending Creates Talent Problems—Which Also Reduce Valuation

Modern staff—especially younger accountants—want:

• A firm with growth

• A recognizable brand

• A clear identity

• Technology adoption

• A proactive reputation

Firms that underspend on marketing look stagnant and old-school.

The result:

• Difficulty recruiting

• Difficulty retaining

• Lower morale

• Limited pipeline for future partners

Talented staff want to join winners—firms with forward momentum. If marketing is nonexistent, momentum is nonexistent. Buyers see that and discount the firm accordingly.

6. Most CPA Firms Don’t Know Their Numbers (Ironically)

When you ask partners, “How much does your firm spend on marketing?” the answer is often:

• “Almost nothing.”

• “Whatever we need at the time.”

• “We don’t really track it.”

Meanwhile, high-growth professional firms (law, financial advisory, consulting) regularly invest 5–12% of revenue into marketing.

Typical CPA firms invest:

• 0.5% to 1.5% of revenue (often less)

The result is predictable:

• Slow growth

• Low brand awareness

• Weak differentiation

• Limited enterprise value

Marketing is the engine that turns services into a scalable business. Without it, a firm remains dependent on its owners—another value killer.

7. Underspending Keeps Firms From Building Recurring Lead Assets

Marketing builds assets, not just one-time wins. These include:

• SEO authority

• Google reviews

• Niche landing pages

• Lead magnets

• Email lists

• Automations

• Educational video libraries

• Content libraries

These assets attract leads 24/7, independent of the partner’s involvement.

Firms that don’t invest never build these assets—and the firm becomes worth less because its growth engine relies entirely on human effort rather than systems.

8. Buyers Pay Premiums for Firms with Predictable Lead Pipelines

In today’s market—especially with private equity entering accounting—acquirers measure firms on:

• Lead pipeline

• Pricing power

• Client concentration

• Growth trajectory

• Digital presence

• Scalability

• Profit margins

• Transferability

Marketing influences every one of these.

When a firm shows:

• A niche speciality

• A constant flow of high-quality inbound leads

• Well-built digital assets

• Strong brand authority

buyers pay a premium.

But when a firm has:

• Weak digital footprint

• No niche

• Referral-only growth

• No marketing engine

buyers see risk, volatility, and uncertainty.

The valuation drops—sometimes 30% to 50% lower than a comparable firm with a strong marketing system.

9. The Multiples Gap: What Marketing-Strong Firms Sell For

Across the industry, the valuation trend is clear:

Firms with strong marketing systems often command:

• 1.0x – 1.3x revenue (sometimes higher with niche authority)

Generalist, referral-based firms often command:

• 0.5x – 0.85x revenue

Marketing strength alone can shift a firm one full tier higher in valuation.

For a $3M revenue firm, that’s the difference between:

• Selling for $1.8M vs. $3.9M

Underspending on marketing is not a budget issue—it’s a retirement-impact issue.

10. Competitive Pressure is Rising Faster Than CPA Firms Are Adapting

Every vertical is seeing more aggressive competition:

• Remote accounting firms

• Niche specialists

• AI-powered bookkeeping platforms

• PE-backed roll-ups

• Digital-first tax providers

• National firms entering niche markets

These competitors are investing heavily in SEO, content, video, social media, and paid ads.

When everyone else is playing offense, staying on defense becomes expensive.

Conclusion: Underspending on Marketing is the Silent Valuation Killer

Most CPA firms genuinely believe they are being prudent or financially responsible by keeping marketing budgets low. But the data shows the opposite:

• Firms with predictable marketing engines grow faster.

• Growing firms command higher multiples.

• Niche-focused firms close more ideal clients.

• Digitally strong firms attract better staff.

• Marketing investments compound.

In short: marketing increases firm value more than almost any other investment a CPA can make.

Firms that fail to invest face slow growth, weak positioning, and lower exit valuations. Firms that do invest gain momentum, pricing power, and long-term enterprise value.

Marketing is no longer optional—it’s a core driver of business valuation in the modern accounting landscape.