Why (Traditional) Marketing Won’t Work in Wealth Management

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The best marketing advice is often the most obvious, at least once you’ve heard it. As a financial advisor, you probably already have solid instincts for what marketing strategies make the most sense for you and your community. The right ones just feel right, right from the beginning. The wrong ones make you want to take a shower after you’re through.

But, it’s also likely you’re unsure whether your instincts are correct. To help you decide, I am pleased to share some thoughtful commentary from Shubha K. Chakravarthy of THEWEALTHMARKETER.com (with permission). Thanks for your thoughts, Shubha! 

Why (Traditional) Marketing Won’t Work in Wealth Management

By Shubha K. Chakravarthy, THEWEALTHMARKETER.com

If you’ve ever tried to take a deep dive into marketing to shore up your business development efforts, you’ve probably run across a wealth of advice on how to get your marketing up to snuff. It’s all about creating a wide-mouthed marketing funnel that’s designed to capture as many possible prospects at the top to maximize your chances of getting paying clients at the other end:

  • Find and “capture” as many prospects as possible by casting a very wide net across your network or the internet, depending on your marketing method of choice
  • Work through all your prospects to figure out if they’ll fit your criteria or not
  • If they don’t, thank them for their time and move on to the next until you do succeed in signing up a qualified new client. Rinse and repeat.

I’ve concluded that this approach won’t work in wealth management.

The traditional thinking in marketing is based on a few fundamental assumptions that you’ll soon see don’t fit the world of financial advice. Conventional marketing wisdom assumes:

  1. A big, wide open and virtually limitless pool of possible prospects for your business – so if one doesn’t work, there’s always another possible one around the corner
  2. Closing a deal with the prospect is a binary proposition – you either do or you don’t
  3. The moment you talk to your prospect is the moment they’re ready and able to sign on the dotted line.

Your own experience and intuition will tell you why these assumptions don’t work in this business.

  1. You’re typically working with high-net-worth individuals in a specific niche. The pool is finite (you’ll soon see why this is a good thing). You can’t burn through a prospect list indefinitely without significant damage to your long-term growth potential.
  2. They’re not only a limited pool but also highly discerning buyers, even for a high “ticket” purchase like wealth management. A wealthy client may buy a luxury car or other purchase a lot faster than they’ll trust you with their big fears and worries. So the process from introduction to client relationship will necessarily be a long one, and should be designed to optimize for this.
  3. You’re selling a service they don’t think they want or need, no matter how much they may end up benefiting by it. And they typically hate to be sold to.
  4. Financial advice is a credence good, which means they have no objective yardstick by which to judge how good you are at what you do. Getting convinced that you are takes time, and a process that’s not sales-centric.
  5. The moment you meet them may be far away from the moment when they want to and will come to you for help.

“If it’s showing, then you’re not doing it right”

The better way to build a healthy and sustainable growth engine for your business is to take the view that you have to always make two sales with each potential client:

  • The first sale is convincing them that it’s worth their time to enter the community of people you’ve chosen to create through your specific offering.
  • The second sale, which may take months or maybe even years, is the moment when they decide they want to move from being merely a member of your tribe to a paying client.

Optimize this cycle without spending a fortune on marketing or burning up your limited time with these steps:

  1. Consciously design a community where the majority of members enjoy and get value from just being in it without cutting you a check every quarter. This step will force you to pick a niche in terms of audience and/or type of problem you help them solve – this will significantly enhance the productivity of revenue generation long-term
  2. Dial up your visibility in regular spurts by contributing knowledge and expertise of value to your community. For example, if you serve business owners, you can create a simple round up every quarter of the top 5 financial issues of concern for business owners you’ve heard from the community, and your views on how to solve them. Making it a mix of things you actively help them with in your service as well as others that you can’t possibly gain from will dramatically increase your credibility and trustworthiness.
  3. Show your human side by regularly sharing experiences, perspectives, thoughts and opinions so your community gets to see your human side as well as appreciate the integral parts of your personality in an authentic and low-pressure way. Chances are, these are the elements that drove your current clients to choose you in the first place, so you’ll be selling what’s best about you without even being aware of it.

Does this take effort? Absolutely yes. But I’m willing to bet it’s a lot less draining and a lot more attuned to who you already are and how you already do business than your current dreaded methods of marketing.

It will feel seamless and natural – to you, for sure, but most importantly, to those you seek to serve.

As a wise colleague of mine observed, “If it’s showing, you’re not doing it right”!

What community are you going to build?

Hat tip to Wendy J. Cook for the insightful observation on marketing.


Shubha K. Chakravarthy is founder and head of market engagement for THEWEALTHMARKETER.com. Based in Chicago, IL, she specializes in creating better marketing strategies, messaging platforms, and execution discipline for wealth management and financial planning firms. Shubha holds an MBA in finance and strategy from the University of Chicago Booth School of Business, and a master’s degree in financial markets from the Illinois Institute of Technology. She has served as a senior executive across strategy, risk management, and business development in the banking and insurance industries.