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It's Tax Day: H&R Block vs. TurboTax

Optimedia CEO Antony Young on Who Had a Better Media Strategy

By Published on .

Antony Young
Antony Young

April 15 is forever logged into our consciousness as Tax Day. Tomorrow some 140 million Americans will have filed their tax returns to the IRS, a chore I personally put just slightly ahead of a tooth extraction. But for two companies -- H&R Block, the country's largest tax-preparation service, and Intuit, marketer of leading software service TurboTax -- this date remains a highly anticipated event on their marketing calendars.

We looked at the two tax services' media strategies to ascertain who could rightfully claim bragging rights as best-in-market. OK, each company is selling a different product, but both are targeting the same group: consumers looking for help with their taxes. In the U.S., some 84 million employees use a professional tax preparer each year, and H&R Block is the lead player. However, computer software is the fastest-growing segment of the tax-preparation business, and according to NPD Group, TurboTax owns that market, with some 82% of the federal-tax-return software sold at retailers last year.

H&R Block's print campaign had the message 'Are you sure you're getting your full refund?'
H&R Block's print campaign had the message 'Are you sure you're getting your full refund?'
Messaging strategy
Overall, the messaging strategies were very different. TurboTax creative espouses the benefits of an easy, cost-effective solution. It heavily promoted its Federal Free Edition, hoping to trade people up to its deluxe product, which retails for $49.95. In one of its TV ads, a woman at a supermarket checkout watches as the scanner reads zero; the line: "Free is better." H&R Block's messaging played on the anxiety of completing tax returns. H&R Block also initiated a promotion around "Second Look," offering to review 2006, 2007 and 2008 tax returns to check if deductions had been missed. That promotion was featured in the company's Super Bowl spot, as well as a print campaign with the message "Are you sure you're getting your full refund?"

So how well did they perform at activating their communications plans?


5 stars Outstanding/innovative
4 stars Highly effective
3 stars Good
2 stars Disappointing
1 star A disaster

Social media

H&R Block 4 stars
TurboTax 5 stars

H&R Block's 2008 marketing effort was recognized for social-media components that included viral videos on blogs, YouTube and social networks featuring a fictional character singing about his love of taxes. H&R Block stepped up its social-media efforts in 2009 by utilizing more social networks and scored high marks by integrating these efforts extensively with traditional marketing efforts.

TurboTax's 2009 social-media approach involved Twitter, Facebook and MySpace. Two notable programs were Freeloader Nation and Super Status.

TurboTax's Freeloader Nation MySpace page.
TurboTax's Freeloader Nation MySpace page.
Freeloader Nation was a site within MySpace that provided users with free tax-filing help and opportunities to win prizes ranging from cash to concert tickets. It also offered a community Q&A space for very detailed tax questions and a link to the TurboTax Twitter account -- where brand reps are resolving issues with individual returns and receiving praise and complaints about the company's software.

Super Status was a weekly contest that challenged users to update their social-network statuses with answers to tax-related questions, luring them with sweepstakes and prizes. They had to use the TurboTax name in their answers. Intuit's director-marketing, Seth Greenberg, explained that users' "friends may or may not know that they're entering a contest, but they can see that they're talking about TurboTax in a positive way and hopefully becoming influencers to their networks."

Online display

H&R Block 3 stars
TurboTax 4 stars

Both companies ran strong online-display campaigns.

TurboTax's online advertising focused on promoting its Federal Free Edition and Internet Explorer tool bar. It also developed a wide-ranging promotional campaign across AOL properties including AOL.com, AIM, AOL Money & Finance, WalletPop and Platform-A's network, creating a TurboTax Live Community widget that helped answer tax questions. TurboTax was the first advertiser to use ad units throughout Google's AdSense network to send clicks to its Twitter page.

The TurboTax Live Community widget helped answer tax questions.
The TurboTax Live Community widget helped answer tax questions.

H&R Block's online ads focused on its "People" campaign and emphasized that the company was able to find errors in 87% of the tax reviews it did on already-prepared returns. Its ads ran on sites such as About.com, Ancestry.com, Apartments.com, BigSoccer, Box Office Mojo, Expedia, Forbes, MSN and Yahoo. It created six different widgets to help with the tax process. The widgets provided summary tax information, news, deduction tips, a Q&A and a poll. In addition to these internet efforts, H&R Block ran a $10,000 sweepstakes that could be entered by filing a tax return with H&R Block or by mail.


H&R Block 4 stars
TurboTax 2 stars

H&R Block officially kicked off its tax season marketing on Jan. 15 with National Tax Advice Day. This year H&R Block marked the occasion by sending thousands of its tax professionals into malls, post offices and grocery stores, as well as onto social-messaging site Twitter and Yahoo's question-and-answer hub, to answer tax-related questions. It provided free tax advice for two weeks to consumers who submitted questions via its website. On April 7, it offered 24 hours of tax advice for free, available by calling its toll-free line or e-mailing questions.

TurboTax gave away several prizes of free products to various websites in exchange for promotions online. That helped to build buzz and promote product information in editorial. It also ran a promotion to pay triple the refund.


H&R Block 3 stars
TurboTax 4 1/2 stars

TurboTax ran ads for its Federal Free Edition with the tagline 'Free is better.'
TurboTax ran ads for its Federal Free Edition with the tagline 'Free is better.'
According to TNS, in 2009 H&R Block increased the share of its media budget allocated to TV to 85% from 81% as the company returned to the Super Bowl after a five-year absence. It bought five pre-game spots, sponsored the pre-game show and spent $3 million on a 30-second spot just before halftime, featuring Abe Vigoda as the "Grim Reaper" touting its Second Look product. Immediately after the commercial, H&R Block ran a contest on Twitter where the first five respondents who guessed the voice of the Grim Reaper won copies of its TaxCut software. The spot ranked 10th in terms of views on YouTube.

In February TurboTax teamed up with NBC Universal to deliver one of the most innovative broadcast-partnership programs of the year. The unique deal, worth an estimated $20 million, integrated NBC programs and talent into TurboTax commercials and gave NBC Universal creative ownership. It developed custom TV spots for nine different TV shows on six different NBCU networks. In one TurboTax ad within Sci-Fi's "Ghost Hunters," NFL Network host Rich Eisen tells a couple watching "Ghost Hunters International" that their ghost-hunting experiment will be "a write-off" and that TurboTax can help. Another spot that ran in NBC's "Heroes" shows Mr. Eisen walking into a comic-book shop as the shop assistant watches the program on TV. They remark that one of the show's characters could deduct his flying if he claimed his profession as "hero" and that the assistant could claim a trip to a comic convention as a business expense. That delivered powerful engagement by integrating relevant creative and the programming environment.


H&R Block 3 1/2 stars
TurboTax 3 stars
H&R Block widget

H&R Block widget

H&R Block's 2009 campaign also featured a foray into mobile marketing. H&R Block teamed with ChaCha, a mobile search service, for the tax preparer's first SMS campaign, giving H&R Block exposure to ChaCha's million-plus subscribers. ChaCha users who texted a tax-related search received SMS ads from H&R Block directing them to its WAP site, where they could learn more about H&R Block's Free Online Tax Prep service.

TurboTax joined forces with leading product-rating and -review service Bazaarvoice to make ratings and reviews of TurboTax available to in-store shoppers on their cellphones.


H&R Block 4 stars
TurboTax 3 stars

H&R Block significantly increased its investment in magazines in 2009, tripling its spend in consumer magazines. Its creative focused on a theme of showing half of an item tailored to each magazine, asking, "Are you sure you're getting your full refund?"

TurboTax promoted customized ads to specialist titles encouraging people to do their taxes for free at TurboTax.


H&R Block 3 1/2 stars
TurboTax 3 1/2 stars

Both brands were competitive in search, appearing in all the major search engines and targeting each others' brand names on Google. According to ComScore, in the period from December 2008 to February 2009, TurboTax generated about 840,000 more click-throughs via organic search, but H&R Block generated more than 670,000 clicks in paid. I call it a tie.

Antony Young is CEO of Optimedia U.S., a Publicis Groupe company headquartered in New York. He is author of "Strategies in a Downturn."

In summary

H&R Block 4 stars
TurboTax 4 1/2 stars

Both marketers developed exceptional campaigns, but in my estimation TurboTax had the slight edge. Both developed innovative social-media platforms that felt both strategic and scalable. TurboTax, given its base of e-commerce sales and history as a heavy online user, showed a lot of digital savvy in social media, online display and search. Its TV strategy with NBC Universal was a highlight. H&R Block was able to integrate social media much more organically through its other media programs. It was also stronger in the way it managed its public relations and promotions. A return to the Super Bowl was well-executed.

H&R Block reported last month that retail returns prepared this year through March 15, 2009, fell 6.2% compared with the same period least year, but net average retail fees increased 7.9% due to more-complex tax returns and a shift in client mix. Total digital returns for the same period were up 5.1% over the prior year. TurboTax said in February that sales were up 10% year on year, reflecting a strong performance.

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