How to Tell Your Own Story
Most advisory firms are not systematically creating public awareness of their services. That’s a big mistake.
Most advisory firm aren’t systematically spreading public awareness of their services. That’s a big mistake.
It’s easy to learn from success, but you can achieve much more by learning from failure. I, for one, learned quite a bit from a project that did not turn out the way I’d expected. Recently, I worked with a marketing consulting firm to poll subscribers to my newsletter. We asked how advisors market themselves, among other topics. Are they using advanced techniques like targeted Google or Facebook ads? How much are they spending on marketing overall? Do they employ a dedicated marketing professional? Other questions related to return on investment. We envisioned great things, like learning the true dollar cost of obtaining a client, the profession’s return from its marketing expenditures and which strategies were most effective. So how was this a failure? By the time we ended the survey, we had gotten back only about 200 responses, by far the lowest response rate I’ve ever experienced. A previous survey had netted 1,554 responses, and the one before that garnered even more. What we learned — and I think this is significant — is that most advisory firms are not systematically marketing themselves. And even if they are, they aren’t tracking their expenditures and the results. So they didn’t feel comfortable filling out a survey. Megan Carpenter, co-founder of Ficomm Partners, the marketing firm that worked with me on this project, was not especially surprised. By her estimate, wealth management and planning firms spend, on average, just 1.7% of their top-line revenue on marketing. To put that in perspective, the next lowest marketing spending in the entire U.S. economic landscape comes from manufacturing firms, which on average spend about 4% of top-line revenue. Tech companies fall in the middle of the overall spectrum, spending 12% to 25% of revenue on marketing. At the high end, the CRM company Salesforce devotes upward of 40% of its revenue toward making the public aware of its existence. More to the point, advisor marketing tends to be scattershot. It may include taking a center of influence to lunch, or posting interesting stuff on a website. There may be a client appreciation dinner thrown in, where current clients are invited to bring a guest or two who might be impressed enough with an advisor’s thank you speech to make an appointment and explore a business relationship. If this represents the typical advisor’s marketing activities, and those expenses are not tracked as a line item on the annual budget, and the results are not tracked either, then filling out the survey would be a waste of everybody’s time. I’m hoping that this will change — for several reasons. First, I (perhaps selfishly) want fiduciary advisors to do a better job of taking market share from their brokerage competition. The brokerage firms are devoting huge advertising budgets for 30- and 60-second ads on the most popular TV networks and sporting
Write about the most important changes you want to bring about in your clients’ lives. This resonates with staff and with potential clients.
events, telling the public they can be trusted (or, in the case of Wells Fargo, that they are working to earn back trust). They are effectively deploying howitzers while planners are deploying the equivalent of peashooters. A more focused effort to tell the world about your services would accelerate the shift in market share from brokers and sales agents to advisors and fiduciary advice.
That Less Conflicted Advice
Second, and related to the first, I think the public is better served by receiving advice from somebody who is on their side of the table, rather than somebody who is motivated to win an incentive sales award trip to Tahiti. But for people to get that less conflicted advice, they need to know you’re out there and available to provide it. Finally, I suspect that the return on investment is pretty high for firms that actually track their marketing spending and results. Carpenter points out that most advisory firms expect to grow their revenue by 10% a year above the “raise” they get from positive market returns. No other profession would dare expect to grow at that rate without putting marketing dollars on the table. I asked Carpenter how advisors could build a solid marketing program from scratch, and she offered some very basic advice. First, ask yourself, why are you in this business? What makes you passionate about financial planning? Tell your story succinctly and powerfully in writing, and write about the most important changes you want to bring about in the lives of your clients. This simple exercise not only helps prospects relate to your value proposition; it also helps your staff understand the point of the work that they do — and gets them passionate about delivering the services that you’re passionate about. Second, define why clients would want to work with you. What benefits do they get from your services? What are the real-world, human outcomes that you try to bring about? If you look at most advisor websites, the focus is on the firm, not on the client — which is the opposite of what you see in just about every other industry or profession. The typical wealth management website provides basic information about the firm and its credentials, along with the process that it follows and a map of how to get to the office. But there’s a better approach. Tell client stories (anonymous, of course, so you don’t run afoul of the testimonial prohibitions), where you describe the presenting symptoms, the type of advice given to solve the problem, the resolution of the problem and the (hopefully positive) outcome. This does several things: it communicates the value of your advice in real-world terms, and it also helps prospects relate to how they can benefit from your services. The prospect might be facing similar challenges, and would understand that he or she happens to be the type of person you work with. If you can make your story compelling, you’ve completed what Carpenter calls the “brand infrastructure.” Once you’ve articulated your “why” and the actual real-world value of your services, you can move on to stage two: content creation. This might include white papers that prospects can download from your website or videos where you answer questions that clients have asked you about the new tax law, recent market volatility or 529 plans and college saving strategies. If you develop a regular habit of responding to questions on video every couple of weeks, you’ll have a wealth of information on your site in six short months. Carpenter also suggests some advanced marketing techniques, like gaining a clearer view of your target market by using Facebook analytics, using promoted posts that reach a very specific target audience (for example, people with more than $2 million in assets who own their own businesses and live within 25 miles of your office), and building an audience that wants to subscribe to your content. Those strategies fall a mile or two outside of most advisors’ comfort zones, but they aren’t as hard to implement as most have come to believe.
A Little More Effort
The interesting thing about these marketing processes is how inexpensive they all are. You don’t need to spend 40% of top-line revenues to make the community aware of your services. With a little more effort, you could be generating two, three, five or 10 times as much awareness as you do now and enjoying a return on your marketing investment much greater than anything in the investment markets. The result would be even faster annexation of market share from the brand-name firms that have dominated financial services with a sales model. And even more important, it would get more of you interested in filling out the next survey.
Communicate your advice’s value in real-world terms. It helps prospects relate to how they can benefit from your services.