Prospects Rely on Internet to Find an Advisor

Clients have come to expect that finding a financial advisor should be as simple as ordering something from Amazon.

According to research from digital wealth management platform AdvisorEngine, more prospective clients are turning to the internet to find a financial advisor.

ThinkAdvisor spoke with Matt Kress, product manager and marketing consultant for advisors at AdvisorEngine, about how outside industries are affecting how prospects expect to find an advisor online.

“Newspapers aren’t a thing anymore,” Kress said. “People are looking at hundreds of reviews for every product on Amazon. There’s customer testimonials. We’re even finding spouses online, or software and apps.”

So, how are prospects finding an advisor today? According to Kress, there’s usually a trigger event that causes the prospect to want to talk to an advisor — whether it’s a certain age milestone, marriage, divorce, a business exit or inheritance.

Most of the time, prospects are still starting their advisor search with a referral from a friend, family member or co-worker, AdvisorEngine’s research finds.

Kress explained that 66% of the prospects in AdvisorEngine’s research started their search with a referral.

However, Kress noted that these prospects aren’t getting just one referral and then contacting that advisor.

“The prospect is getting on average 2.6 referrals and then looking up those advisors online,” Kress explained. “So even if they start with their referral they’re still typing into Google … the name and firm or name and location. And then starting to evaluate all those different advisors.”

Based on what shows up in that Google search, the large majority of time the prospect is only picking one of those advisors to then start a conversation, according to Kress.

“Unless there’s some big red flag in person or on that first conversation, then advisors tell us that they do a pretty good job turning prospects that start the conversation into clients,” he added.

While most prospects start their advisor search with a referral, AdvisorEngine’s research finds that the remaining 34% start with a “cold” online search.

“[These] prospects were going online and just searching on search results — typing in Google words like ‘retirement financial advisor Atlanta’ or ‘top financial advisor New York,’” Kress explained.

According to Kress, more people over the past three years are starting with cold searches rather than referrals.