I was inspired to write this article after discussing with a few prospective clients in the wealth management industry. There are a couple things I noticed across the board when it came to their prospecting strategies: the use of traditional marketing or just the lack of use of any sort of marketing for those already comfortable with their inflow of inbound leads.
Whether you are at a point in which you are blessed with inbound leads or looking to take your business to the next level through aggressive prospecting, you must always be looking to use the most time and cost efficient way to scale and grow your business.
There are two types of marketing that are used to help you grow. Traditional “traditional” marketing and traditional "digital" marketing. One of which is cost-free but is inconsistent and time consuming while the latter is perhaps consistent but very expensive.
One must use an multi-channel approach to the way you connect with people you may potentially collaborate with.
BUT... what if you could use what is currently the most efficient way to prospect at the moment?
In this article I will cover the most common prospecting and lead generation strategies and discuss why they may be inefficient to grow your business.
More importantly, I will provide a very powerful alternative that I feel is still overshadowed in the world of wealth management business growth strategies.
Traditional “Traditional” Marketing
Relying On Referrals
Word of mouth or referrals has you depending on your customers to spread the word about your business puts the control of your lead generation in someone else’s hands.
- They provide a limited pool of potential customers for you; and on top of that, referral business won’t last forever. It simply is not sustainable long term.
- Your prospective customers are searching for your products and services online, therefore you cannot rely solely on word of mouth.
- Furthermore, it brings you more of the same. So relying on them is fine to the extent that you want more of the same. Referral-heavy firms stay busy, often struggling to focus on on their niche clients.
- Referrals are not a reliable source of business if your firm is oriented around a horizontal positioning (practice area, demographic, etc.). They are more so if your firm is positioned vertically because clients – when they change jobs – typically move to a new employer in the same vertical.
When I used to "network", I often felt like I had to talk to certain people because I thought they would need what I had to offer. My conversations were always stunted, however, because I was trying to connect with a selfish approach. Instead, I found that connecting with people on a friendship level really made the new connections I had more meaningful.
- Networking should be to create relationships and build meaningful conversations. When prospecting for new clients you should NOT shy away from the prospecting side and must be unapologetic about how you come across wanting to work with someone. Networking isn’t the place for that type of aggressive strategy.
- There’s a lot of “I” and “me” in those statements. Where’s the benefit to the person you’re meeting? Unless they have an immediate, unmet need for the services you provide (hint: low probability), there’s likely little benefit to their connection with you.
How many of you approach a "networking event" with that sort of mindset: “I’m going to meet people who I might be able to get some business from” or “There will be a lot of potential business opportunities at this event,” etc?
That mindset is wrong. It’s inherently selfish. That’s why your networking attempts are failing and fruitless. Focus on quality over quantity when at a networking event.
Traditional "Digital" Marketing
In the wealth management industry, digital marketing strategies are used by big and small firms alike. Again, it is a good idea to have an online presence and an authority on Facebook and other platforms. Unfortunately it has been proven that consistently having a solid exposure on these platforms can be expensive.
Now I'm not saying Facebook marketing is bad. Quite on the contrary, it can be very powerful if used right. But somethings to keep in mind if you are already using Facebook marketing but it's not giving you the results you're looking for.
- Facebook Ads can result in a lot of poor quality leads. Many people may sign-up because it’s so easy and they simply followed the directions. They may not be interested enough to attend or even remember that they signed up. Those people are likely not going to be great leads for your business.
- Organic growth of content is becoming harder and harder. Unless you are paying Facebook for ads, no one sees your content and this is a big con to Facebook advertising. Many marketers who are not interested in paying to share their content on Facebook will not be able to benefit from the platform.
- "In fact, research shows that in 2018 the cost of CPM advertising on Facebook and Instagram’s ad platform went up 122%. Just by the third quarter of 2019, social media advertising CPM was up to $5.35, with trends showing CPMs typically increase towards the end of the calendar year as brands attempt to retain ad space. "
Ad spend is going up and up, so that doesn't help the narrative of trying to use something that is inexpensive. It can be consistent though.
Now, LinkedIn is not thought of as such a strong "marketing" outlet. It certainly is over-looked when individuals and businesses in the wealth management industry.
It is possibly the strongest tool to prospect, especially in the wealth management sphere. The fact that you can filter down exactly who you want to talk to makes it an extremely powerful way to consistently create new and meaningful conversations.
Not only is it consistent in the way it provide you a way to meet new prospects but it is also inexpensive. 0$ in ad spend! Here are some numbers for you:
- LinkedIn is 277% more effective for lead gen than Facebook (HubSpot 2019)
- LinkedIn Makes up 80.33% of ALL B2B lead gen on the internet vs Facebook only at 7%.
- 61 million LinkedIn users are senior level influencers and 40 million are in decision-making positions.
To conclude, if you are using the above traditional marketing strategies and not LinkedIn, then consider shifting your focus. If you are already using LinkedIn. I encourage you to double down on the time you spend on it to grow your business.