Marketing leaders invest 33% more than other advisers, Fidelity survey finds

Apr 16, 2015 @ 1:47 pm

By Liz Skinner

Financial advisers serious about growth need to invest cash and time.

Advisers who are marketing leaders spend about 2.4% of revenue to marketing and business development, compared with 1.8% of other advisers, according to a Fidelity Clearing and Custody survey. In addition to spending 33% more on business development initiatives, such marketing leaders also prioritize growth, compared with other firms, and the results are apparent, the 2014 Fidelity RIA Benchmarking Survey found.

These leaders see 40% more client growth, 23% more asset growth and 20% more revenue growth than firms that have other priorities.

The commitment is something advisers sometimes overlook, said Gail Graham, chief marketing officer for United Capital.

“I've seen many advisers waste money on things like print advertising and sponsoring social events like the ballet, by doing nothing to follow-up on them,” she said. “It must be a disciplined approach.”

She also believes advisers who are committed to growth need to spend more than 3% of revenue on business development and need an overall marketing strategy.

Source: The 2014 Fidelity RIA Benchmarking Study

“It's about having the skills, tools and strategy to look at marketing as an investment area and then measuring it,” Ms. Graham said.


All advisers today should be spending on digital marketing, including investments in a great website and a client portal, she added.

In fact, InvestmentNews' 2014 Financial Performance Study of Advisory Firms found that investing in a great website is the No. 1 marketing tool for 65% of advisers.

(More: Upgrade your website or drive away business )

BakerAvenue Asset Management of San Francisco, one of the firms identified by Fidelity as a marketing leader, concentrates its efforts on telling a consistent firm story across all communications, including social media.

“We express who we are through everything we do — from our branding to the space we sit in to the people we hire,” said Jerry Luff, BakerAvenue's chief operating officer, in a written statement.

About 75% of marketing leaders have a clearly defined story that illustrates how their firms are different from others, according to the Fidelity data.


Ms. Graham said United Capital advisers have found “bring a friend” events targeted at women to be an especially effective business development tool.

“Women love to bring their friends, they don't want to go alone,” she said.

Such events should be planned with goals in mind, such as closing two prospects who attend the event, she said.

Using a disciplined approach to cultivate and win referrals from centers of influence also has been effective, she said. That can include hiring a coach who can hold the adviser accountable for following the plan.

Committing to formal strategies for garnering referrals has been an effective growth driver for advisers.

Of the top-performing firms in the 2014 InvestmentNews study, 42% of them had a formal referral process with clients and 37% had such a process with third-party professionals as well.


What's your best business development strategy?

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