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Marketing 101: Answers to 10 Common Questions

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For many independent advisors, getting started with marketing can be intimidating. Where to begin? Which tactics are most effective? How do you know if your plan is working? Here, we discuss 10 of the most common questions advisors face as they develop and execute marketing strategies.

1. Why do I need to select a target market? “Select a target market” is often the first piece of advice advisors hear as they delve into marketing. Why? Because marketing isn’t effective unless you know whom you’re marketing to. To get results, your marketing needs to push the “hot buttons” of a defined group of people—that is, your ideal clients. To capture your audience’s attention, your marketing messages must address their specific needs and concerns. If you try to market to everyone with a generic message, there’s a good chance it will end up in the circular file.

For some advisors, the idea of shutting the door to some potential clients, even while opening it wide for others, can be scary. In the beginning of your career, you may have been willing to take anyone who came knocking, and it can be challenging to narrow your focus to a smaller segment of clients. From a marketing perspective, however, it pays to be strategic, targeting the clients you really want to attract.

2. How do I communicate the firm’s essence to the marketplace? Communicating with the marketplace requires positioning—the art of creating a firm identity in the minds of your target audience. How do you want to be known? As the largest firm in your area? The most elite? The friendliest? Perhaps you want to cultivate an image as a local, community-based practice, or define yourself with a particular specialty, like socially responsible investing.

Of course, no matter how you want to be known, you can’t just invent an image out of thin air. Your marketing message must be supported by real facts. For example, having an office in the center of a small town contributes to the image of a community-based firm, while being named to Barron’s Top 100 Financial Advisors supports the image of an elite, nationally recognized practice.

3. Which marketing tactics work best? When it comes to marketing, there are no guarantees about what works. A strategy that’s really effective for one advisor may not be so successful for another. While it can be helpful to compare marketing tactics with other advisors, don’t lose sight of your target market and how you are positioning your firm. Just because 30 people showed up for a Social Security seminar another advisor held doesn’t mean that approach would yield similar results for you. A number of variables come into play, including overall execution, the ideal client targeted, the time and financial commitment required, and the advisor’s own strengths and weaknesses.

And don’t forget: life happens. A freak snowstorm in May could sabotage even the most carefully planned client appreciation event. That’s why it’s best not to put all your marketing efforts in any one basket.

4. How can I create a professional image? Many advisors want the look and feel of professional marketing materials, but they don’t always want to pay for them. As a result, they may get sucked into marketing details better left to the pros. If you want the highest-quality materials, your best bet is to ignore any do-it-yourself impulses and hire professionals to take charge of copywriting, proofreading, graphic design and the other elements that go into creating a high-end image. Your office printer (even a really good one) simply can’t create the same four-color brochure you’d get by outsourcing the job. Remember, appreciating good marketing and being a marketing professional are two different things.

5. Are there inexpensive ways to market my firm? Asking existing clients for introductions is one of the fastest, least expensive and most effective ways of gaining new contacts and potential clients. But many advisors find it challenging to ask for referrals. In fact, if it means avoiding the referral conversation, some advisors are willing to spend considerably more time, money and resources on marketing. Advisors who master asking for referrals, on the other hand, may be able to cut back significantly on marketing expenditures.

Public relations might seem like a free strategy. Yet, when you factor in the time it takes to deploy a successful PR campaign, it’s usually not. A reputable PR firm can usually deliver the best results, but hiring one requires a financial commitment.

Finally, don’t forget about the marketing resources and support that your broker-dealer or sponsors may offer. Rather than reinvent the marketing wheel, see if you can take advantage of customizable brochure templates or other marketing materials that may be available to you.

6. Should I adopt social media? Think back to before 2000, when the concept of creating a website was new. Advisors asked, “Do I really need a website?” A decade later, we know the answer is yes. Now, advisors are asking similar questions about adopting social media. While the jury may still be out on the most effective ways to harness this new tool, it seems likely that most advisors will tap into social media marketing at some point in the future. Marketing-savvy advisors will want to stay abreast of developments in social media to ensure that they don’t fall behind the curve.

7. Should I hire someone to implement my marketing plan? Once you’ve identified your target market, determined how to position your firm, selected tactics that suit your resources and personality, and created a written marketing plan, it’s time to execute the strategy. At this point, many advisors wonder whether it makes sense to hire a marketing coordinator to carry out their plans. Say that the cost for an hour of your time versus a staff person’s time is 10:1—would that justify the salary of a marketing staff person? If executing your plan will require three or four hours of work per week, you’re probably ready to hire a part-time employee dedicated to marketing.

8. How do I quantify marketing results? Just as clients want to know how their investments performed, advisors who pursue marketing want data on what worked (and what didn’t). It’s important to realize that quantifying marketing results is an imperfect science. While you can count how many recipients opened your emails, the number of birthday cards you sent out, or the number of people who attended a seminar or event, it’s difficult to assign cause and effect. For example, if someone becomes a client, you may never be sure if it was because of your monthly email messages, the articles you published in the local paper, or the market update seminar the client attended.

In short, while gathering data is important, don’t expect to find the secret to future marketing success. Remember, it costs money to measure, so right-size your expectations when it comes to quantifying your marketing results.

9. How can I get marketing results fast? Advisors frequently underestimate the long-term commitment a successful marketing strategy requires. When you’re new to marketing, hosting a single client appreciation event may seem like a major undertaking. In fact, no one event is likely to have a long-term impact, and even a short-term impact isn’t a given. Marketing involves repeatedly keeping the name of the firm in front of your target market over an extended period of time. Take marketing to strategic alliances: A single lunch with a CPA isn’t likely to yield a referral relationship right off the bat. It takes work and persistence. If you’re serious about gaining real results, it’s wise to think of your marketing investment in terms of years rather than months.

10. I don’t need to market my firm, do I? In general, advisors are doing more—and more sophisticated—marketing than they did a decade ago. Consider the medical and legal industries, which shunned marketing at one point. Now, it’s not uncommon to see billboards, TV commercials and radio ads for doctors and attorneys. The financial services industry may never go that far, but avoiding marketing entirely is naive.

At a minimum, every advisor needs to brand his or her firm with signage, stationery, business cards and a website. Beyond that, how far you take your marketing efforts is up to you. A basic marketing plan is a great way to ensure that your marketing efforts—as simple or as sophisticated as they may be—align with the firm’s vision and resources. As you embrace marketing, you’re bound to confront a few tough questions, including many not addressed here. But stick it out, and you may well find that the long-term rewards of a solid marketing strategy more than make up for the initial challenges.