Traditionally, RIAs (Registered Investment Advisors) and FAs (financial advisors) have worked in a face-to-face business. They get together. They look clients in the eye. They shake hands. They even build a personal level of trust with prospects before turning them into Clients.
Their marketing efforts traditionally have reflected this approach. FAs and RIAs have relied on networking, cold-calling, in-person seminars, workshops, and referrals from other advisors to get new leads.
What do those marketing activities all have in common? None exist today.
If there is anything investment and financial advisors know, it’s numbers. But when it comes to the traditional channels, we’ve never seen numbers like these.
The digital environment had changed the way people wanted to meet their RIAs and FAs already. But with the COVID-19 pandemic shutting down much of the economy and forcing people to work from home, expect everything to go into overdrive. Traditional marketing methods that RIAs and FAs have relied on no longer work the way they used to. It’s time to evolve or get left behind.
How Everything is Changing: The Stats
You only have to look in your local community to see how things have changed. But once you see some of the statistics, one thing becomes clear: RIAs and FAs are going to have to quickly change the way they approach lead generation.
Cold-Calling: Be Careful When More People are Working From Home
Cold-calling is a time-honored tradition for some businesses, and they can’t think of attracting leads any other way. It’s also going out the window.
The problem? Fewer workers are there to answer their office phones. Many of them have migrated to a work-from-home setup, which means that any time you call them now, it means you’re likely reaching a personal line. That changes the entire context of how you handle lead generation in a more digital world.
According to Statista, in late March, 62% of all workers reported that they had been asked to work from home.
One important thing to keep in mind when it comes to cold-calling: the trends were headed this way in the first place. In the last five years, remote work has increased by 44%. 82% of companies were already using some sort of remote and in-person balance before COVID ever hit.
Don’t expect this trend to change any time soon. A Staples Workers Survey found that two-thirds of employees would start thinking about another job if they lost the flexibility to work from home. The trends before COVID-19 were already pointing us toward a future of less cold-calling and more emphasis on digital solutions. COVID-19 threw that process into fast-forward.
Direct Mail: A Mode of Investor Recruiting, or a Dead Art?
A pandemic doesn’t mean we don’t mail each other anymore. But when it comes to direct mail as a form of generating leads, results can be mixed.
Yes, effective direct mail marketing is better than no marketing at all. But pay attention to the statistics. Total mail volume—that’s every piece of mail across the entire nation—has decreased over a quarter since 2006, according to the USPS. As with cold-calling, many forms of direct mail offers are now met with skepticism. Anything that appears to be a sales pitch or a lead generation tool gets tossed in the recycling along with the other “junk mail.”
One problem—or, depending on your perspective, one solution—is that email marketing has essentially replaced direct mail. And it’s done that job extraordinarily well. Return on investment with email marketing can be as high as $42 for every marketing dollar spent. We now view our email inbox as our true “mailbox,” and given the sophistication of email over direct mail, customers expect more. That includes:
In-Person Networking and Conferences
More than 83 million people were affected as conferences were canceled this year. Many RIAs and FAs rely on in-person networking to find new leads. But conferences have been canceled this year, affecting almost the entire working force in the United States. It’s going to hit RIAs and FAs particularly hard unless they can learn to adapt their strategies.
How do you reach people when no one is going out to be reached? How do you network when all of the networking events are canceled?
Once again, you have digital options:
Recommendations for Updating Your Lead Generation Strategies
Given these changes, are FAs and RIAs out of luck? Not remotely. All that’s required is that you understand the shift in the nature of lead generation. Learn how to market to today’s customers on their terms, and you’ll create as personal an experience as you ever have.
Here are some essentials to get you started:
COVID-19 might feel like the end of the world, but it’s not. It’s a transition to a new way of doing things. And the world for RIAs and FAs may be forever changed. Stay ahead of it and build a brand that relies on new modes of lead generation Client engagement. The changes are happening anyway—it’s up to you to decide whether you’ll stay on top of them.