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Is Your Marketing Plan Working?

Marketing activities involve a commitment of time and financial resources, so it's important to monitor how they are paying off.

Helen Modly and Sandra Atkins, CPA/PFS, 12/13/2012

It's time to create your marketing plan for 2013. Hopefully you had one for 2012 that you actually implemented. This month we'll share what was included in our marketing plan and how we evaluate its effectiveness.

An effective marketing plan targets the audiences that are most likely to become your clients or provide referrals to prospective clients. In the past, our firm's growth was mainly attributable to referrals from centers of influence (COIs: other connected professionals who can refer their clients to us) and our existing clients, so they were the primary targets for our mostly one-on-one marketing activities. We rarely did any real print media advertising until 2009 when the stock market was just beginning to recover from the meltdown.

This past year, we noticed an increasing number of new prospects reaching out to us after doing a search on the Internet. In many cases, they saw us mentioned in an ad and then looked up our website. These potential clients reviewed our site and basically prequalified themselves based on what they read. We coined this new marketing technique "answer the phone" after we had a rash of unsolicited phone calls that resulted in us gaining some terrific new clients. It wasn't until really analyzing where these new clients first heard of us that we realized the effect of running regular print ads.

Marketing Materials
Our marketing plan focuses on three main areas: centers of influence, existing clients, and identified prospective clients. For all three groups, we have created or purchased marketing materials that we use as part of our "drip" plan, so that we can have something in front of our target markets at least quarterly.

Examples of our marketing materials include:

--Announcements of milestones in our firm, such as when one of our advisors was named Planner of the Year or when another advisor celebrated 10 years with the firm and became an owner

--Brochures tailored to specific groups: retirees, women, etc.

--Purchased materials that address specific issues, such as Social Security and Medicare information

--E-blasts with timely investment information or commentary

Centers of Influence
This year we created a marketing brochure offering a complimentary investment portfolio review, called the Second Opinion Service. This is offered to our centers of influence as a benefit they can provide for their clients who have expressed a concern about their investments. They need to provide us only with some very basic information along with their existing account statements, and we will prepare a written analysis of their client's portfolio. It is not necessary for them to provide the identity of their client.

We have set up a streamlined process for doing these reviews. We realize we may not gain many new clients by offering this service (and some will likely be under our minimums). Our main goal is to support our referral sources by providing an excellent value-add service for their clients. Within days of introducing this service to our COIs, we received calls from both an attorney and a CPA asking for a second opinion review.

We have a list of attorneys and CPAs who are on our quarterly drip list. This group is composed of professionals that we know personally, and many have referred clients to us. Our goal is to have one face-to-face meeting each year, usually over lunch. At the first meeting with a new COI, we learn about their business and the type of clients they are seeking. We then share stories about our firm, talk about our new initiatives like the Second Opinion Service, and leave behind a packet of our new materials.

In addition to keeping in touch with our existing list of COIs, each advisor is responsible for identifying and meeting with one new attorney or CPA each quarter and adding them to our drip list.

Existing Clients
We rarely make direct requests for referrals from our existing clients. However, we send them our marketing materials, such as the Second Opinion brochure, on a regular basis and ask them to pass the materials on to friends or family who might be interested. In spite of our lack of specific requests for referrals, our high level of personal service results in frequent referrals from clients, particularly of their family members.

New Prospects
In order to reach out beyond those we know, we have several ongoing marketing initiatives designed to keep the phone ringing. Some of these are:

Website: We have spent a significant amount of time and money tailoring our website to our firm. We want it to have the look and feel of who we are, so we have written the copy ourselves and have been very thoughtful about the photographs and content. We regularly have articles published online and in local publications, which pushes traffic to our website and increases our presence in search results for advisors in our area.

Print marketing: We now advertise in a few select publications--very local newspapers and regional lifestyle magazines. Some of these name "top financial advisors" on a periodic basis. When we learn that we will be named, we run an ad in that issue as well as one to three other issues for the same magazine that year. We have had a surprising number of prospects call in after seeing our name in a listing or our ad in one of the publications.

Participation in professional organizations: Our advisors are active in the local FPA chapter and frequently have the opportunity to respond to media requests. This gets their names in print in various national professional and consumer publications. We also belong to NAPFA, which allows prospects to find us through the search feature on the NAPFA website.

Participation in referral programs offered by custodians: Several custodians have referral programs for qualified advisors. These programs require an investment of time and resources. The referrals are not as "warm" as those coming from COIs and clients, so they take longer to convert, and you have to kiss a lot more frogs before you meet any princes.

Figuring Out What Works
All of these marketing activities involve a commitment of time and financial resources, so it's important to monitor how they are paying off. We keep a summary of prospects by source using the following categories:

--Centers of influence referrals
--Client referrals
--Our custodian's referral program
--Prospects from positioning efforts: ads, website, articles, Internet search, etc.
--Other: prospects who know an advisor personally, referrals from other sources

We track the total prospects we meet in each category and which ones became clients, so we have a close ratio for each effort. This year we have received almost an equal number of clients from each activity, although the close ratios are very different. For instance, we had eight referrals from clients. We are still working on three of them, but of the other five, four became clients, so our close ratio is 80%. For those prospects who "find" us through their own efforts such as a web search or seeing our ads, we have a closing ratio of about 50%. We also obtained four clients from our custodian referral program, which we just joined, but that required meeting or speaking with 23 prospects, so the close ratio was only 17%.

This information tells us that we need to continue our print advertising as well as our quarterly drip program. It will require us to plan in advance what marketing collateral needs to be created or purchased, who will receive it, and when it will go out. Our marketing budget within the firm has had to be increased, but we believe the results prove that it is money well spent. With more prospective client activity, we have also learned how important it is to have a comprehensive initial phone interview to disqualify those who are not likely to be a good fit with our firm.

Make the Plan and Stick to It
This year we have really seen results from sticking with our marketing plan, even when we get busy, so we will continue our efforts into 2013. It's important not to let your marketing activities slump just because the pipeline begins to fill. To keep track of where we stand, we review our new business pipeline weekly. Only by setting specific marketing activities and holding your staff accountable for meeting them can you avoid the feast or famine cycle so common with small firms.

Helen Modly, CFP, ChFC, is executive vice president and director of investment services for Focus Wealth Management, a fee-only registered investment advisor in Middleburg, Va. Modly has more than 20 years of experience providing wealth-management services. She is a member of NAPFA and FPA. She can be reached at info@focus-wealth.com.

The author is not an employee of Morningstar, Inc. The views expressed in this article are the author's. They do not necessarily reflect the views of Morningstar. The author is a freelance contributor to MorningstarAdvisor.com. The views expressed in this article may or may not reflect the views of Morningstar.

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