Charles Schwab CEO Rick Wurster recently stood by the company’s “Carl” ad campaign, which has drawn criticism from advisors and competitors who suggest it’s disrespectful to independent advisors.
An actor appears in the ads as stockbroker Carl, who can’t match Schwab’s services and expertise. In one ad from 2021, Carl’s former clients compare him unfavorably to Schwab consultants. In another from last year, he’s recording an apparent podcast when his crew looks online and finds superior offerings from Schwab.
“It confounds me how we tolerate this,” William Capuzzi, CEO of Apex Fintech Solutions, which offers custody and clearing services, recently commented on a post containing an AdvisorHub article about Wurster’s comments.
“Like many out there, I have CNBC playing in our offices throughout the day and cringe at the ‘Carl’ commercials," he wrote. They are a slap in the face of the advisors that use them for custody.”
Josh Jalinski, CEO of Wealth Quarterback and Jalinski Advisory Group, added, “Schwab, do better. They should pull the Carl ads.”
Schwab’s CEO, now finishing his first year in the job, fielded a question about the commercials at the company’s Impact conference in Denver last week, which hosted thousands of independent advisors. He said the Carl ads aren’t a knock on advisors and noted Schwab has invested in marketing for RIAs.
“Well first, in financial services advertising, it's really hard to stand out. Things often sound the same. And so the benefit of Carl has been it's funny, he draws attention, he's memorable. And so people remember Schwab and then they might come into Schwab and ask about what we do and why we're different,” Wurster said.
“The Carl ads are about creating that opportunity to think of Schwab and remember Schwab,” he added, noting Carl is meant to contrast with RIAs and Schwab itself.
“We positioned Carl as a full-commission broker. You look at the mug he's got on his desk, it says ‘Number One Broker.’ Every reference to him is as a broker. ... We are creating this image of the full-commission broker against whom you also compete with every day as being an outdated model that's conflicting.
“And we want to open people's eyes to the idea that there's different ways of doing business, whether that's working with an independent advisor, which is far different than a full commission-broker, or coming and working with Schwab where we think we'll put the client, the best interest of the clients, at the forefront,” Wurster said.
“If in some ways you think we're making fun of advisors, we're not, and you should use the opportunity of Carl to have a conversation with prospects and clients about how you're different than Carl and different than full-commission brokers,” the president and CEO said.
“And while we're advertising about Carl, we're also supporting you through big commitments to advertising as well. We've had the ‘Find Your Independent Advisor’ advertising campaign for a while,” which has led to many click-throughs to RIAs, Wurster said.
“That advertising and that campaign has supported people finding all of you. More recently, we've launched a new campaign called Schwabvious. ... It’s all around us being the obvious choice for the RIA community,” he added.
“But we spend a lot of dollars every year to support all of you, to draw attention to the RIAs," he said. "And at the same time we believe in Carl as a way of creating interest in a different way of doing business.”
While not commenting on Schwab’s Carl ads, financial services marketing expert April Rudin, The Rudin Group CEO, told ThinkAdvisor on Wednesday that “it’s just always important to consider how the industry is portrayed to both end investors and to potential new recruits.”
But not everyone sees the campaign as a dig on RIAs.
“If the broker ‘Carl’ in the Schwab ads offends you then you should either lighten up or do some self reflection,” securities lawyer Kristian Kraszewski posted on LinkedIn. “The ads clearly are poking fun at the old school broker that charges high commissions. If you feel attacked, maybe you are charging too much for the services you are providing.”
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