Client expectations about you and your practice don't suddenly kick into high gear after you've added an individual or firm to your book. They start way before you've even made your first contact, since prospective clients assume you have an online presence.
Establishing that digital presence and being available online means you must fully embrace technology. Fortunately, there are many new ways to accomplish this, thanks to an array of resources offered by broker-dealers and a variety of other financial firms and third parties.
Plus, by employing digital technology you can track and measure in real time which marketing strategies are producing the results you want and where you need to make adjustments.
"People are expecting to interact with technology in all aspects of their lives. The best advisors have incorporated it into their offerings — and marketing is no different," said Jessica Liberi, vice president of product development for financial software maker eMoney Advisor.
While traditionally, advisors have relied on referrals and seminars to get new clients, "That's a [relatively] passive approach," Liberi explained. She adds that eMoney Advisor aims "to enable digital-marketing methods to help advisors really go after specific segments of the market, so that when prospects are ready to make a decision, they know who the advisors are, and the advisors are able to see how they interacted with their content."
The move to digital marketing by FAs has been evolutionary and continues at a steady but relatively slow pace. "Financial advisors have been looking into online marketing, including social media, to target younger prospects, and we've seen a lot of advisors adopting tools like video," said Isabella Fonseca, a senior research analyst at Aite Group, an industry research firm. "More and more have been made available. But the adoption [of them] isn't as mature" as the technology itself.
It is clear, though, that if more advisors do not soon start applying digital technology to their marketing efforts, they will be at a competitive disadvantage. "Clients are telling us they want to communicate in different ways. Even our older clients are expecting this today, so we have to be more responsive," said Mike White, chief marketing officer of Raymond James.
In fact, "If advisors don't have a strong digital presence and automation that people have come to expect, [their] firm may not be seen as modern or as capable as a competing one," said Marie Swift, president and CEO of Impact Communications.
In other words, "You can't be a Luddite advisory service competing with all the technology-minded ones out there," said Evan LaHuta, head of client experience at Pershing Advisor Solutions.
Online Options
Digital marketing starts on advisor websites. Interactivity gives clients and prospects a sense of the firm's value and personality.
Websites also help the firm operate as a paperless office. In July, for instance, advisor Ron Carson — whose Carson Group has more than $10 billion in assets under advisement — launched a new client onboarding system on Carsonwealth.com.
Designed and built by his firm and eMoney, the Client Experience Optimizer (or CEO) is like a game. At the end of a brief questionnaire, prospects get a reward — the suggestion of a risk-level-appropriate investment portfolio. Once prospects become clients, they do not need to retype this information.
"We consider this a holy grail for client experience and advisory productivity. I'm guessing that it could double or triple our number of leads because of the new engagement level that gamifies the experience," Carson said.
The Omaha-based advisor is spreading the word on his new radio show, available as a podcast and on iHeartRadio and traditional radio. All of Carson's 54 partner offices will have CEO capability this summer. Since 2010, his firm has invested more than $40 million in technology to drive prospecting and productivity, as well as to differentiate it from the competition.
Other advisory firms are investing millions in digital marketing, too, but they need to be systematic about it, according to Scott MacKillop, CEO of First Ascent Asset Management, which relies on high-quality videos produced by its director of communications to give its website a user-friendly approach.
"Advisors have to figure out, before they put money into marketing technology, what goals they're trying to accomplish and how they expect to see a return on their investment," MacKillop said.
Employing technology for marketing is "a little bit art and a little bit science," he explains. "Most advisors don't have a skill set yet for all the techniques. But advisory firms that know how to do online marketing really well will experience great growth."
There's little doubt that state-of-the-art tech can boost practice productivity and performance. In fact, a 2015 study of over 400 advisors done by Pershing and the Aite Group ("The Emerging Digital Advisor"), revealed that "more than 90% of digitally enabled advisors increased their AUM, with more than a third of the practices growing by more than 10%."
"Over the last 12 months, firms using technology have nearly doubled revenue growth, our research found," Pershing's LaHuta said. "Those that don't use it are going to have a different ending to their story."
Being Social Savvy
Social media is at the heart of most advisors' digital-marketing efforts. By picking up information posted by investors on their social networks (Facebook, Twitter and the like), advisors can find out what's happening in prospects' and clients' lives.
In partnership with Hearsay Systems, Raymond James is even providing dozens of "Social Signals" to its independent and employee FAs to keep them up to date on important personal events that have financial implications for their clients — a new marriage, job change, relocation, birth of a grandchild, etc.
Advisors receive alerts about such happenings when they're posted by members of their social network. "All these represent money in motion and an opportunity for advisors to educate people on [investments] they might consider that [could] come with the change," White explained.