Prep Firms Taking the Groan Out of Tax Season

H&R Block, Jackson Hewitt, Others Lure Consumers With Positive Spins, Incentives, Big-Event Strategies

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It's tax time. Rejoice.

Big tax-prep providers such as H&R Block and Jackson Hewitt are looking to put a positive spin on the annual ritual, given that many of their customers look forward to refunds at this time.

"Our target is hard-working mainstream American families," said Debra Dowd, senior VP-CMO at Jackson Hewitt. "What is overlooked, with so much focus on the stress of tax time, is that it's actually a happy time for many because over 70% get a refund."

It's also a happy time for the media, given that the blitz of tax-prep-services advertising at this time of year is predictable as, well, taxes. It's a necessity given the intermittent nature of the business -- this is an industry where companies interact closely with consumers typically only once a year, and usually complete just one transaction.

Last year, some of the top tax-prep firms spent more than $225 million in the first six months of 2010, according to Kantar, led by H&R Block ($123 million), Intuit's TurboTax ($100 million) and Jackson Hewitt Tax Service ($12 million). Smaller firms such as Liberty Tax Service and even the IRS itself, which spent $1.6 million to get the word out to consumers about its digital capabilities, added several millions more to that total. Still, 2010 represented a drop in spending from 2009, when the total for the largest three was more than $250 million.

Jackson Hewitt CMO Debra Dowd
Jackson Hewitt CMO Debra Dowd

H&R Block CMO Robert Turtledove
H&R Block CMO Robert Turtledove

H&R Block's "Never Settle for Less" marketing theme this year, created by Publicis Groupe's Fallon, Minneapolis, shows real people in small-town Greenback, Tenn., and at the Nickel Diner in Los Angeles, who brought their taxes in for a second look. Many received money back they didn't know about. "We can't forget that for a lot of consumers and taxpayers, it is the single biggest check they may get all year," said H&R Block CMO Robert Turtledove. "In a cautious economy, you can't afford to take any chances. This is real money and real income, or a real out-of-pocket expense if you do it wrong."

H&R Block is also promoting its "At Home" online software with a memorable national TV ad from Fallon, seen during the Grammys and in other prime time, with a giant pink stuffed bunny at the end of a crane trying to knock down a building, with the theme that you need the right tools for the job.

Jackson Hewitt is taking a similar, albeit smaller, approach with its "Get Every Dollar You Deserve" multimedia ad campaign. Like H&R Block, it employs tax professionals at retail locations, and like H&R Block and TurboTax, it has an online-only at-home software option.*

A general national TV ad campaign serves as "air cover" and complements its local efforts, said Debra Dowd, senior VP-CMO at Jackson Hewitt, such as tax-prep service offices inside Walmart, branded entertainment deals with local radio disc jockeys and co-op advertising in local media with franchisee owners. Jackson Hewitt agencies are Omnicom Group's Zimmerman Advertising, Fort Lauderdale.

That exclusive Walmart partnership expanded from 1,800 to 2,000 retail shops (one-third of the company's storefronts are in Walmart), offering tax prep for as low as $38 at Walmart, backed by a co-branded with-TV ad that garnered a lot of interest, Ms. Dowd said.

TurboTax, the big online tax software and filing service, also maintains an economy-minded theme of guiding consumers to get their maximum refund while they "Choose Easy." TurboTax is using a big-event strategy that included the Grammys, which it has participated in the past, but blew it out this year with five media partners including YouTube, Twitter, and Westwood One; along with the creation of its own prime-time event on NBC, where it took over all the TV commercials during the airing of the movie "National Treasure." The total 35 minutes of TV spots were strung together like a "show within a show" called All Star Celebrity Treasure Hunt. TurboTax also bought out the home pages of Yahoo, AOL and MSN during the Super Bowl.

"The decision to do that is not just to align with the Super Bowl, or the Grammys, but that it's the right timing," said Seth Greenberg, VP of Intuit's media and digital marketing. "It's what you do with that timing that matters."

TurboTax also promoted its addition to its digital portfolio, SnapTax, a mobile tax-filing app for iPhone and Android users. It licensed singer B.o.B.'s hit song "Magic" for a TV and online ad that began the day after the Grammys. Interpublic Group's Dailey, Los Angeles, is TurboTax's agency of record, while Collier Simon, Los Angeles, created the SnapTax work.

And while taxes may not be the most exciting category, marketing professionals can learn a lot from them, said Rohit Bhargava, senior VP-global strategy and marketing at Ogilvy 360 Digital Influence, particularly from the social-media savvy of H&R Block and TurboTax. Both firms have aggressive social-media presences where they not only answer customer questions in real time, but also actively monitor and respond to general tax conversations.

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CORRECTION: An earlier version of this story incorrectly reported that Jackson Hewitt did not offer an at-home online tax-prep software.

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