Digital marketing fundamentals - empower advisors to succeed

How can I position my Advisors for digital marketing success? This is the number one question asked by most Financial Institutions I have had the honour to talk to.

With many Broker-Dealers, custodians and Advisory firms already looking ahead to Robo Technology, most have yet to put the essential pieces in place to position their financial advisors competitively in the digital world. What it means for the firms and financial advisors; and what it will take to compete for next-generation clients.

Why Digital Marketing Success Matters

Sitting at the threshold of the greatest intergenerational transfer of wealth, in which an estimated $30 trillion dollars will pass from baby boomers to the next generations over the next three or four decades, financial advisors could be looking at an unprecedented opportunity for growth or they could be facing the greatest threat to their survival.

Why the disparity in outlook? Some financial advisors will be better positioned to capture the attention and trust of the next generations; while others will be all but invisible in a digitally-wired world. The financial advisors that fail to connect with the children of their baby boomer clients stand a better than even chance they will lose the assets upon their transfer.

Although many factors can contribute to the heirs’ decision to take the money and run, it is the inability to relate to the next generations in a manner compatible with their preferences and expectations for social interaction and communication that can weigh the heaviest. Generations X and Y are anchored in a technologically-driven mores that must be understood and fully embraced by anyone who hopes to gain their favor and, in the case of financial advisors, their trust.

The Digitally Elusive Generation

Financial advisors won’t have to wait until the Great Wealth Transfer to feel the effects of Gen X and Y unresponsiveness because it’s happening right now. According to Fidelity research, the emerging affluent are twice as likely as their millionaire, baby boomer parents to find their financial advisor through Internet research and social media.

The Fidelity study revealed even more about the preferences of the emerging affluent investor (age 21 to 49, $50,000 to $250,000+ of assets; $100,000+ income)

  • Nearly 60% of emerging affluent investors have a significantly more positive impression of advisors with a good website
  • 38% follow their advisor on social media sites

  • 30% say they are more likely to relate to a financial advisor who has a social media presence

The study’s authors fully expect these percentages to increase as more advisors make themselves digitally available. The conclusion drawn by the study is that, if advisors don’t have a strong digital marketing presence and don’t demonstrate an ability or desire to communicate with next generation clients and prospects through social media and other forms of digital interaction, they risk irrelevance.

Don’t Forget the Boomers

While most of the financial services industry has been laser focused on the baby boomer generation for the last decade, it may have missed a technological transformation that has occurred in that same timeframe; which is that boomer is not only online en masse, they now comprise more than half of all Facebook users. More than 65 percent of adults ages 50 to 65 and nearly half over the age of 65 use some form of social media. In that group, women, who will control half of the nation’s wealth by the year 2020, are online the most.

Financial Services Industry Challenges

Unless you’ve been living under a rock for the last four or five years, the trend has been undeniable, and its trajectory grows steeper with every passing year. Although very few firms are fighting the trend, the chasm between where clients are, regarding technology, and where many advisory firms are is as wide as ever with most financial advisors languishing in technological mediocrity, or worse, when it comes to establishing an effective online presence.

…the chasm between where clients are, regarding technology, and where many advisory firms are is as wide as ever with most financial advisors languishing in technological mediocrity, or worse when it comes to establishing an effective online presence.”

Some firms are currently undertaking major initiatives to catch up, while others continue to struggle with the same fundamental issues that have slowed their entry into the digital world from the beginning. For many firms, compliance issues continue to be a drag on efforts to fully embrace the potential of web marketing for their advisors; however, other issues may be slowing the march forward:

  • Slow adoption: Financial advisors tend to be slow adopters of any technology. However, the transformation from traditional marketing practices to web marketing has been especially slow, hampered in part by compliance issues, but primarily from reluctance.
  • Aging advisor population: Financial advisors have been slow adopters as a whole; however, older financial advisors have avoided the transformation like the plague. Their excuse? Their clients are older as well and happy with the traditional advisory relationship. The reality? As the research indicates, at least half of their clients are online and using social media.
  • Compliance: For some firms, compliance issues continue to slow progress; although many firms have worked through the compliance issues by fully adopting the FINRA guidelines and investing in new technology that aids in oversight and review of web content.
  • Inadequate technology and resources: Many independent advisory firms have been able to react more quickly to the technology needs of their financial advisors due to their nimbleness and their ability to control compliance issues at a local level. Although they’re gradually progressing, larger firms with centralized marketing and compliance departments have been limited in their ability to respond except on a mass scale which limits the ability of financial advisors to personalize their websites or actively engage in social media. Although it may satisfy the need to have a website, it does very little to create the critical online presence today’s advisors need.

Unquestionably, advisory firms face numerous challenges in moving to the forefront of the type of technology that will keep their financial advisors competitive in the quest for next-generation clients. The larger challenge, however, will be retaining financial advisors who fear the deep descent into obscurity that will occur without the means to market themselves. Numerous surveys have identified marketing as the top concern for financial advisors who have little appetite for old-school approaches, yet the vast majority of financial advisors are still sitting on the outside of the digital world looking in.

Numerous surveys have identified marketing as the top concern for financial advisors who have little appetite for old-school approaches, yet the vast majority of financial advisors are still sitting on the outside of the digital world looking in.

In a digital world, in which financial advisors must be able to raise their visibility, establish their authority build influence, and communicate effectively with their clients and target markets, broker-dealers and advisory firms must find ways to help them create an online presence using the best practices of advisor web marketing.

What Financial Advisors Need Just to Compete in this Digital Marketing World

What we all know to be true is that having a web presence is critical, if for no other reason than to validate one’s existence to the market. At a minimum, a website is today’s business card, without which there is no legitimacy. Recognizing this, many financial advisors or their firms rushed to create static websites, which sufficed as a business card but were largely unimaginative and technologically lacking.

For the more discerning, tech-savvy next generation client, these templated websites don’t instill a high level of confidence. Anything less than a modern digital strategy is very likely to render a financial advisor invisible to a market that is poised to control $30 trillion of assets

For the more discerning, tech-savvy next generation client, these templated websites don’t instill a high level of confidence. Anything less than a modern strategy is very likely to render a financial advisor invisible to a market that is poised to control $30 trillion of assets.

The Key Elements of a Modern Digital Marketing Strategy for your Financial Advisors

At its core, a modern digital marketing strategy must include certain key elements for positioning a financial advisor in the market, identifying the target market, conveying a core message, and a method of cultivating contacts and relationships. The basic components of an advisor digital marketing presence, or web apparatus, should include a website, a blog, email marketing, and a social media presence on relevant networks, all integrated into a comprehensive strategy.

With that as the structure, the key elements that are essential to a turn-key strategy include:

  1. Fresh, compelling, original Digital Content
  2. Integrated Social Media
  3. Responsive Design

My next article will cover the Content portion of any sound Digital Marketing Solutions, stay tuned!!

Content - the foundation of your advisors' digital marketing footprint

Please Note: this article is for informational purposes only. We strongly encourage you to verify any content and information you use with your own compliance department or legal counsel.

Written by Loic Jeanjean
Loic is the Head of Sales and Marketing at Advisor Websites where he is responsible for continuous refinement, testing, and execution of the company’s go to market strategy. This includes optimizing the company’s sales approach (direct sales, partner based, web-based, etc.) and its implementation. He is a member of the Financial Planning Association® (FPA®).