It’s that time of the year again…
Nothing is certain but death and taxes, and most people face both of these with roughly the same level of excitement. This year, around 96M Americans expect a tax refund, and they have up to April 15th to file their returns. But in spite of the pressure and tension of tax season, there’s a growing share of optimists (29%) within taxpayers getting a refund in 2019 who expected it to be higher than the previous year… 🤔
Luckily, more and more apps have picked up on their users’ pain points, and are starting to develop solutions to make the whole tax preparation process simpler. The rise of Fintech app technology, specially tailored to aid users in the hassle of tax season, is increasingly playing a key role in the way Americans prepare their taxes, with great results.
Kicking off tax season 📅
There are two kinds of tax preparers in this world: the ones who file early, and the ones that wait until the last-minute. Each group has specific behavior patterns when addressing how to deal with taxes, so it’s important to keep those in mind when coming up with an effective tax season app strategy.
Most Americans prefer to file early… but not that early. In 2019, only 12% submitted in January, while the majority (54%) filed them between February-March. That said, 19% of taxpayers filed their taxes “at the last minute” (that is either the day before Tax Day, on the due date itself, or even after the date by requesting an extension).
This data suggests that March offers marketers a great opportunity to attract new users who are still looking for an easy solution to file their taxes. Advertisers can also leverage app retargeting to re-engage users that have already filed their taxes. An easy way of achieving this is to highlight some of the other services the app offers, such as acquiring a new credit card, applying for a loan, or browsing investment options, to ensure users stick around for the long term.
How are Americans filing their taxes?
The answer is d i g i t a l l y ✨. In 2020, 41% of taxpayers plan to file using tax software. This proves digital’s great impact on Fintech tools, and especially with regards to taxation. While last year the expected usage of tax software equaled that of accountants or finance professionals, this year online tools stand as the #1 option.
Leveraging User Acquisition and App Retargeting during Tax Season
Stay relevant by delivering the right message at the right time based on date proximity to Tax Day and where each user stands within the funnel.
#1 Drive app growth throughout the season
Don’t wait until April, start in advance. Last year, 66% of taxpayers filed their taxes before Tax Day. By boosting their Tax Season strategy well in advance, app marketers can reach early planners as well as last-minute preparers, growing the impact of their marketing efforts.
Each moment before the big day needs to be addressed differently:
- Use the early planning months to educate users on the benefits your app can offer for Tax Season.
- As Tax Day approaches and the sense of urgency rises, make sure to remind users of the event, showcasing new offers and deals that drive them to use the app.
- Remember your strategy doesn’t end on April 25th: once you have successfully led taxpayers to install, it’s a great moment to re-engage users by offering other in-app products they might be interested in.
#2 Build machine-powered creatives to improve performance
Yes, it’s important to deliver the right message at the right time with an eye-catching creative… but it’s equally important to know which ads work best. When using different ad sets to inform, educate & re-engage, it’s hard to determine which units resonate the most with users’ interests—but when adding technology to the mix, things get easier.
Using Dynamic Ads app marketers can automatically develop and test hundreds of ad variations in little to no time. By using each design asset as a unique data point, this tool can identify top performing combinations and optimize head-on.
Here’s an User Acquisition example to illustrate how it works:
In the example below, there are three different variations for the headline, the copy, the call to action and the image.
The highlighted variations are the ones that the delivered the best performance:
- Headline: Ready for Tax Season
- Copy: The easiest way to tackle your taxes
- Call To Action: Install App
- Image: Woman smiling
Using machine learning, it’s possible to mix and match the different copy and image variations to find the combination of ad elements that successfully engages users and drives incremental growth.
#3 Leverage App Retargeting after Tax Season
Any campaign around special dates and holidays should always contemplate what happens after the peak seasonality period. Tax Season comes around once a year, but a successful strategy should ensure that users stick around. You can engage your newly acquired users by introducing other app features they can access (not necessarily related to taxes!). Leverage App Retargeting to keep users engaged: Why should they keep coming back?
Fintech apps are becoming the ideal companion for taxpayers. Users are increasingly opting for practical and cost-efficient (or event free) tax software platforms instead of personally hiring an accountant. But Tax Season does not only call for the preparation of taxes… app marketers need to be prepared as well 😲.
If you want to learn more about User Acquisition, App Retargeting or Dynamic Ads get in touch.
“2020 Tax Season Survey: When and How Americans Will File,” Offers.com, 2020.
“2019 Tax Return Study,” NRF & Prosper Insights & Analytics, 2019.
“Tax season 2020: Most Americans don’t understand how tax refunds work, and it might cost them,” USA Today, 2019.
“IRS opens 2020 filing season for individual filers on Jan. 27,” IRS, 2020.