May 10, 2013

Advisors Mulling a Move Should Check the Elephant in the Room

Cetera launches campaign acknowledging fears of losing clients and revenue; new Fidelity research also highlights loss aversion as key factor

Cetera Financial Group has launched a new recruiting campaign this week that the 6,500-advisor network regards as unique for addressing the emotional aspects of changing firms.

Susan Theder, chief marketing officer for the El Segundo, Calif.-based broker-dealer network, says conversations about career transitions tend to focus on the advantages of making a move while ignoring the elephant standing in the room: the risks of making the move.

Susan Theder“What our campaign is capitalizing on is research we’ve conducted that shows the greatest common denominator for advisors in making a move,” Theder (left) tells AdvisorOne in an interview.

That common denominator, she says, is a strong emotional response revolving around fears of loss—specifically, the loss of clients and loss of revenue as the advisor is getting up to speed in his or her new broker-dealer home.

“That loss aversion weighs far more heavily than their anticipated gains from the shiny objects dangled by firms,” Theder says.

Cetera, which wants to assuage those fears by acknowledging these emotional truths, has launched a “truth campaign,” centered on an interactive website that use simple relationship-based metaphors for the emotions the firm’s research shows advisors are feeling.

“Breaking up is hard do,” is the message of one of its pages meant to address fears that current clients won’t make the transition with the advisor. “It’s not you, it’s me” is another that deals with advisors’ inhibitions about leaving their current firm.

The insights behind the campaign are consonant with research conducted separately by Fidelity Investments, also released this week, which shows that a focus on the financial aspects of advisor transitions may be less effective than the family and emotional dynamic behind the decision.

The Fidelity study found that encouragement and discouragement from family members played a significant role in transition decisions and that risk-avoidant motivations, including fear of the unknown and stress of the move, were dominant factors in keeping fence sitters from moving.

Broker-dealers that focus on their technology platform or product offerings are therefore talking past advisors’ key concerns, Cetera’s Theder says.

“We believe that relationships underlie this industry, whether firm relationships or family relationships. Truth and integrity weigh more than financial benefits,” she adds.

Cetera, which runs four broker-dealers, is reaching out to advisors through channels including digital advertising, email blasts, print advertising and through its Elite Advisor newsletter.

Theder says the firm determines its content strategy through a “client or spouse test,” including only information the firm believes an advisors would tell their clients, wives or husbands.

“So much of marketing is ‘download this whitepaper,’” Theder says. But it’s really “all about engaging people. We all want to be engaged and entertained. We want [our truth campaign website] to be like a Pinterest page. We have a passion for thinking of advisors as people.”

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