H & R Block isn’t just about filing taxes anymore – or at least that’s the message the Calgary, Alta.-based company is trying to spread.
Having recently come under attack from competitors Softron and The Liberty Group, as well as new software programs and a slew of tax-return mom and pops, the largest tax-filing firm in Canada is determined to win back its market share after losing 200,000 customers since 1999. How? By making itself visible long after the April 30 tax deadline via the introduction of a new flagship store in downtown Toronto and a push on other financial services like RESPs.
Strategy caught up with H & R Block veteran Cor Verbeek, the managing director of the company’s newly formed Central Ontario Market Group, based in St. Catherines, Ont., to discuss how the new division plans to overcome its competition and reposition the company for growth.
What will the flagship Toronto location do for the H & R Block brand?
By situating ourselves in the financial district, we’re sending out the message that we’re more than a tax partner – we’re a financial partner. The permanent location demonstrates that we’re here beyond tax season.
Where do you see growth opportunities outside of tax returns?
We’re focusing on the RESPs. Since most of our revenue is generated during the tax-filing period, we market at this time. However, we will consider year-round advertising as the business grows.
Why did you form the Central Ontario Market Group (COMG)?
We created this unit in August 2003 to create greater cohesion throughout stores in the region. The COMG is working to achieve a more effective positioning in the market place.
What tactics are you using to achieve this?
We’re shifting our focus from the institutional to the relational. We’ve created a new position, that of the client service manager (CSM), at each location, to enhance connections with clients. We have also introduced the H & R Block Advantage. Customers do not pay for returns until they’re satisfied with the services, and they know service fees upfront.
What research led to the implementation of these changes?
In focus groups, we asked clients what they see as the best tax preparation services. Cash-back customers want the return done quickly and want to leave with a cheque. In contrast, the regular business wants the return done correctly and to get the biggest refund. The customers’ objectives result in a different service slant.
What is your marketing message?
The COMG’s ad spend this season comes close to $2 million, and included in that sum is the advertising for the cash-back service. Our theme this year was, ‘Walk in with your taxes, walk out with your money.’ We’ve sped up the process, largely due to electronic developments and a partnership with Western Union.
What other strategies have you introduced?
We’ve established a tiered pricing structure [which is being tested in Regina and Kitchener, Ont.] We don’t want pricing to be too high or too low, since each sends out a message that can result in a market share loss. Pricing that is too low can lead to clients questioning credibility. And pricing that is too high drives customers to competitors.
