H&R Block and TurboTax brawl for customers

TurboTax fired the first shot earlier this tax season by suggesting that not only were tax preparers at H&R Block and other shops part-timers who aren't dedicated to their customers, but moonlighting plumbers with no background in financial planning whatsoever.

H&R Block turned around and sued Intuit, alleging the ads infringed its trademarks and falsely asserted that its tax preparers aren't real experts. Its motion to withdraw the commercials was denied, so now the battle's gone online.

H&R Block chief executive Bill Cobb fired off a rebuttal letter about as dry as you might expect a piece of corporate correspondence to be, but its marketing team responded by putting its tax preparers in front of the camera and listing their credentials. Cobb also mentioned, in a memo obtained by PR Daily, that more commercials explicitly targeting TurboTax are on the way.

As AdAge discovered, the two companies' commercials are just the latest escalation of their pitched battle for the hearts and minds of America's mathematically challenged taxpayers. H&R Block's ad spending increased 14.7% to $278.7 million in its 2012 compared to the year before. Intuit, meanwhile, decreased advertising expenses from $177 million in fiscal 2011 to $151 million in 2012 fiscal year. However, it poured more money into marketing TurboTax while trimming spending in other areas.

With even the Internal Revenue Service jumping on social media this tax season -- launching a Tumblr account and beefing up its Facebook page, multiple YouTube channels and Twitter feed -- tax prep companies are feeling the pressure to step up and avoid getting shoved out of the way.

Going after some of the very plumbers and store sales clerks that use your service may not be the best way to gain new customers, but the small pool of folks who need their taxes done by these companies isn't getting much larger. Gaining new business means taking some away from your competitors, and that tends to get ugly -- even by tax season standards.

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