The CFP Board’s Public Awareness campaign has been underway for over 4 years now, investing a cumulative total of over $40M of “dues” from CFP certificants with an 80% increase in CFP registration fees that began in 2011, plus almost $10M of additional funds from the CFP Board’s own reserves. And after almost $50M, what does the CFP Board have to show for it?
As it turns out, a lot. The latest Ipsos brand tracking study for the CFP Board shows it is making very significant progress in building awareness with mass affluent investors who might seek out a financial advisor. In just four years, intent to seek out a CFP certificant is up from 30% to 52%, and overall trust in CFP certificants is up from 23% to 49%. Even more significant, top-of-mind awareness for CFP certification has leapt from 13% to 29%, passing the CPA license (only 12%), and dwarfing other designations like CFA, CLU, ChFC, and PFS (all scoring under 5%).
In fact, for the first time ever, the Ipsos study shows that consumers seeking financial advice are most likely to insist their financial planner have CFP certification, more than any other designation, certification, or license. The CFP marks even outrank the CPA license (as well as all other designations) when it comes to what a ‘professional financial planner’ is expected to hold.
These significant results mean the CFP Board remains committed to the public awareness campaign in the coming years – so CFP dues will not be going down anytime soon. But arguably, the real news is that the CFP Board’s efforts in public awareness are continuing to set the roots for financial planning to finally be recognized as a bona fide profession of its own, with the CFP marks at its core. Perhaps someday, the profession will eventually reach the point where consumers don’t even have to ask!
CFP Board Public Awareness Campaign (PAC)
The CFP Board’s public awareness campaign was first proposed by its Board of Directors back in 2010, as what would potentially be a multi-year campaign to help boost consumer awareness of the CFP marks. The goals were to improve for the CFP marks both “top-of-mind” awareness (when thinking about financial planning services, which designation comes to mind first?), “unaided awareness” (which other designations come to mind for consumers without being prompted?), and “total awareness” (when prompted, does the consumer recognize the CFP marks?).
Recognizing the difficult scope of trying to reach “every” American, the campaign was targeted in particular towards the “mass affluent initiator” group, defined as “an adult between the ages of 35 and 64 with investable assets between $100k and $1M and a mindset that makes them likely to seek out financial advice.”
At the time, the campaign was controversial, because it entailed an effective increase in the CFP registration fees of 80%, lifting the cost from $360 every 2 years to $324 per year. All of the additional revenue from the dues increase – which amounted to nearly $10M per year, given the number of CFP certificants paying the higher dues – was earmarked for the public awareness campaign, along with an almost equal amount (approximately $9M) that would come from the CFP Board’s own reserves in the first two years.
Ultimately, the Public Awareness Campaign (PAC) was tentatively scheduled to run for two years, and at that time the Board of Directors would assess the results on the aforementioned awareness metrics, to decide whether to renew for an additional two years – thus targeting a total run of $40M over 4 years. Though as it turns out, the public awareness campaign results have been so good, the Board of Directors apparently had little trouble deciding that they should continue to renew it.
Latest Ipsos Brand Tracking Shows Progress On CFP Board’s PAC
When the CFP Board began its public awareness campaign, there was undoubtedly significant room for improvement. Top-of-mind brand awareness was only 13%, and total unaided awareness was only 17%. Only 30% of consumers who intended to seek out financial planning advice intended to use a CFP professional, and only 25% stated that they would recommend a friend seek out a CFP certificant. Only 23% of consumers thought CFP certificants were trustworthy in the first place.
Five years later, the progress has been significant, as tracked by outside market research firm Ipsos. Top-of-mind awareness for CFP certificant has leapt to 29%, and total unaided awareness is up to 34%. Intent to seek out a CFP certificant is up to 52%, and 49% stated they would recommend a friend seek out a CFP certificant. Trust in CFP certificants is also up to 49%.
In a world where brand improvements are typically measured in small-single-digit changes over many years, CFP Board’s progress in its public awareness campaign is significant.
Public Awareness Of CFP Certification Vs CPA License (Vs Other Designations Like CFA, CLU, ChFC, and ChFC)
As a part of the brand tracking results, Ipsos also tracks awareness of the other popular designations and licenses that overlap with CFP certification, including the CPA license, the CFA charterholder, and the CLU, ChFC, and PFS designations – again, scored on the basis of top-of-mind awareness, total unaided brand awareness, and overall total brand awareness.
As the results reveal, the CFP certification leads most other ‘popular’ designations, and by a very large margin. When consumers are simply prompted to come up with designations for financial advisors, 1-in-3 thinks of a CFP, but only 1-in-20 has the CFA as top-of-mind, and not even 1-in-100 thinks first of the CLU, ChFC, or PFS. Even when prompted with the name of the designation and asked if they’re familiar with it, not more than about 1/3rd of consumers have even heard of the CFA or CLU (and only 1/4th know the PFS and fewer than 1/5th know the ChFC)… whereas 85% of consumers (at least, the mass affluent initiators being targeted and surveyed) are familiar with the CFP marks.
In fact, at this point the CFP certification lags only the CPA license in total brand awareness, and not by much as the gap continues to close with the CFP Board’s efforts. Perhaps even more notable is that when it comes to financial planning services, the CFP certification now has better top-of-mind awareness of the CPA license, even though they both have similar total unaided awareness. Which essentially means when consumers are asked about certifications/designations/licenses relevant for financial planning, their first answer is increasingly the CFP marks, and then their second answer is to be a CPA.
In fact, in a new survey tracking question Ipsos added this year - what designation(s) would you insist your financial planner have – the leading answer was CFP certification by almost 2/3rds of the surveyed consumers… followed then by a CPA license (at just under half of those surveyed), and then other alternatives.
This represents a remarkable shift in consumer perceptions and awareness, and a significant milestone for CFP certification – for the first time that it’s been measured, mass affluent consumers seeking an advisor are more likely to insist on the advisor having CFP certification than a CPA license.
If The CFP Board Public Awareness Campaign Is Working, Where Are All The Clients?
Notwithstanding the apparent success of the CFP Board’s public awareness campaign, the most common compliant I still hear about the campaign is that “prospects still don’t even ask me if I’m a CFP, so was this dues increase really worth it?”
First and foremost, it’s crucial to recognize that expecting a consumer to ask a prospective advisor to their face “are you a CFP?” will never be realistic for most – not because consumers do or don’t care about CFP certification, but simply because even if they do, asking that way is a confrontational approach that most just won’t be comfortable with. After all, if the consumer asks, and the answer is “No”, a very socially awkward silence quickly ensues!
Instead, the reality is that for consumers who do care about CFP certification – which as evidenced by the Ipsos brand tracking survey, is an increasing number of them! – they will simply find out if the advisor is a CFP certificant by other means. Perhaps the prospect will ask for (or just be handed) the advisor’s business card, and if that card doesn’t have “CFP” on it, the prospect will never follow up with a call. The advisor will never know that was the deal-breaker.
Alternatively, often the prospect already knows if the advisor is a CFP certificant, because he/she looked it up online beforehand. Remember, in the modern world, you are probably not your client’s first impression, your website is, so the prospect would know the answer to “are you a CFP [or not]” before the first meeting ever occurs anyway (which means even if it matters, no one will ask you about it to your face)!
What all of this really means is that, in the end, the benefit of the CFP certification and a consumer preferences for it will not be reflected in the questions consumers ask advisors, but instead in choices consumers make when selecting an advisor. In other words, the CFP certificants will get more clients than the non-CFPs, and the greater the public awareness of (and demand for) CFP certification, the more successful advisors with CFP certification will become over those without.
And here, there is some evidence that this is already the case; an Aite Group study in 2012 found that solo CFP professionals generate 40% - 100% more revenue than non-CFPs, and that amongst those with fewer than 10 years of experience CFPs were almost twice as likely to make above-average income as an advisor. An unrelated industry analysis by Angie Herbers of Kaleido also found that even entry-level advisors earn an average of $5,000 more in salary if they have CFP certification. If the public awareness campaign continues to succeed, the gap between the income of CFP and non-CFP certificants should only become even more pronounced in the coming years. The next (2015 or 2016?) version of these studies comparing CFP and non-CFP compensation (and growth rates) should be very interesting, to say the least.
CFP Awareness And Progress Towards A Real Profession
Overall, the available data certainly suggests that the CFP Board’s public awareness campaign is “working”, and making real progress. Which means CFP certification registration fees won’t likely be going back down anytime soon – the Board of Directors has indicated it intends to keep the campaign in place, as long as the results continue to have positive momentum.
But from the perspective of the profession overall, I still think the public awareness campaign is a good thing, and a ‘good investment’ for us collectively (especially given that the CFP Board appears to be producing real results).
In the end, It’s crucial for consumers to have a clear minimum professional standard when it comes to financial planning, to understand who is and is not a professional. Accordingly, I was a supporter of the CFP Board’s public awareness campaign from the beginning – and still am! – as the reality is that historically the CFP Board relied far too long on the membership associations like NAPFA and the FPA to do the public relations work on its behalf. In point of fact, the CFP Board owes a great deal of thanks to NAPFA and the FPA for putting the marks into a position where they could succeed in the eye of the public that they have. But it was about time that the CFP Board began to carry the ball for itself.
Of course, in the long run, I’m still hopeful that having CFP certification will actually become part of the fiduciary standard for the delivery of financial advice itself – after all, fiduciary is about more than just conflicts of interest and the duty of loyalty… competency matters, too, and our current competency standard for holding out as a financial advisor is just too low! And while that day where we lift the minimum competency standard for financial advisors may still be a ways off… continued progress on the value of CFP certification in the eyes of the public will help the profession to keep advancing towards that goal!
In the meantime, if you still hadn’t seen them, some of the recent public awareness aids that have been running on television via national cable networks like Fox, MSBC, AMC, HGTV, and via radio, can be seen/heard below. And remember, the CFP Board also has a public awareness toolkit you can use to get involved and support as well!