Adviser marketing should target existing clients
A marketing executive with a leading fund manager has recommended financial planners direct the majority of their marketing budget and activities toward existing clients and not prospective clients.
Perpetual marketing manager Meagan Knight said in doing so advisers could consolidate their already established relationships, which would in turn generate additional referrals for their practices.
The basis for the suggestion is recent research Perpetual conducted through Newspoll regarding the attitude of investors in the market who had a financial planner.
Speaking at the recent Financial Services Partners prestige partners conference, Knight said: “Twenty five per cent of these investors indicated they felt they were in a situation where they might leave their adviser.”
“I think the most telling result out of all of this is the percentage of clients who would actually recommend ... For endangered clients, practices are likely to see only 26 per cent of them referring, and for the committed clients 81 per cent were likely to make a referral,” she added.
Knight described these referrals as being “like gold” because they are coming from people who already understand the offer from the particular planning practice.
In terms of marketing spend, she suggested practitioners commit 5 per cent of their business revenue to it.
“The existing clients are going to generate the greatest amount of revenue for your business É so I’d suggest allocating 60 per cent of the budget to them,” Knight said.
She added that 30 per cent of the total spend should be allocated to targeting prospective clients, with the remaining 10 per cent assigned to general advertising.
Knight stressed that advisers’ marketing strategies had to be constantly developed and warned planners not to believe any of the myths surrounding marketing, including the belief that great work will speak for itself.
“Are you really capitalising on the relationships with the clients you do a great job for? What you can’t rely on is the assumption that great effort will produce those rewards [referrals] without asking for them,” she said.
As such, she proposed planners’ marketing campaigns attempt to ensure satisfied clients are making referrals to their family and friends on the strength of the success of the existing relationship.
Recommended for you
Compared to four years ago when the divide between boutique and large licensees were largely equal, adviser movements have seen this trend shift in light of new licensees commencing.
As ongoing market uncertainty sees advisers look beyond traditional equity exposure, Fidante has found adviser interest in small caps and emerging markets for portfolio returns has almost doubled since April.
CoreData has shared the top areas of demand for cryptocurrency advice but finds investors are seeking advisers who actively invest in the asset themselves.
With regulators ‘raising the bar’ on retirement planning, Lonsec Research and Ratings has urged advisers to place greater focus on sequencing and longevity risk as they navigate clients through the shifting landscape.
