Established financial advisors who aim to accelerate the growth of their firms often look to increase their marketing efforts to attract more prospects and bring in additional new clients. In practice, this is often done by taking the main components of a firm’s brand – value, verbal messaging, and visual design – and refining, in particular, the firm’s visual design, with a new website and new marketing materials designed to instill new and faster growth. Yet, in reality, the biggest driver of accelerated growth is often to improve verbal messaging first… and upon doing so, many advisory firms discover that it’s even more appealing to leverage that new messaging as internal marketing to generate more referrals from existing clients instead!
In this guest post, Angie Herbers – Chief Executive and Senior Consultant at Herbers & Company, an independent management and growth consultancy for financial advisory firms – talks about the core components of a brand, and why these components are important to drive firm growth. As while the value of a firm lies in its services offered, the client experience as a whole, and how the firm delivers on both, many advisory firms make the mistake of investing too early and heavily in visual design upon recognizing the value they provide, without first working out the verbal messaging which defines and communicates their own identity and values. The end result of this disconnect between the value and the messaging about it is lackluster lead flow; accordingly, the visual design should actually be defined by the verbal messaging and will be most impactful when it can serve to communicate the firm’s values and convey its identity. Which is only possible when the firm’s verbal messaging has been clearly defined in the first place.
The two primary modes of marketing communication are internal and external. All new firms must start out with external marketing efforts to grow their client base in the first place – in other words, they need to target strangers, website visitors, and prospects to simply convey that the firm exists and to identify the services available. In addition to prioritizing the main components of a firm’s brand, understanding the firm’s different audiences and knowing how to effectively communicate with each are paramount to effective external marketing to increase lead generation.
However, for existing firms, especially those with well-established client bases, internal marketing can be a much more valuable marketing approach, if done correctly. Internal marketing targets existing clients exclusively, providing not only updates about the firm’s growth and progress, but also reminders of the firm’s value through educational content and the ongoing provision of outstanding client service. In fact, ideally, internal marketing strategies should provide exclusive marketing value and messaging that is only available to existing clients. If done right, internal marketing can leverage clients themselves as promoters who generate referrals for the firm. Because with the right branding, client service experience, and exclusive internal marketing outreach efforts, clients will be enthusiastic about telling other people they know about the firm and will eventually become the firm’s own best marketers!
Ultimately, the key point is that firms who are just starting out will need to rely on external marketing efforts to cultivate clients in the first place, but firms with a well-established client base can leverage their own clients as effective promoters of the firm by using an internal marketing strategy that targets clients exclusively. However, this is only effective if the firm has invested in creating a well-defined brand with verbal messaging that clearly conveys their identity and values (which is then communicated consistently with internal scripts for client review meetings), developing employees as part of the brand, and specializing their marketing communications… all available only to existing clients who may then refer the advisory firm (even more often than they did before!).
When you think about your advisory firm’s marketing, what is the first thing that comes to your mind? For most independent advisory firm owners, their ‘stuff’ comes to mind – their podcast, email campaigns, brochures, blog, website, social media, etc.
Let’s be clear: This ‘stuff’ is the ‘how’. It is how you deliver your marketing message; it is not the message itself. It is simply the delivery service to ‘get the word out’. But none of it works if you do not know ‘what’ you are trying to say. How you deliver your message is only 20% of developing a great marketing program.
The remaining 80% of your ability to grow your firm is what you are saying, and if you get the ‘what’ right, you will have articulated your brand. In doing so, you will illustrate ‘why’ you exist.
No, your brand is not just your logo, tagline, or whatever. Your brand is a representation of ‘why’ you do ‘what’ you do, and the combination of these integrated parts make up who you are as a company and communicate clearly what you represent and why you exist. To develop your marketing programs effectively, you must begin with your brand.
The three elements of a brand are your Value, which communicates what you do through client service, your Verbal message, which says what you do for your clients, and your Visual appearance, which illustrates what you look like and how people identify you through pictures.
If you want to be more successful at growing your company, you need to focus your time and energy on building, enhancing, and protecting these three communication methods—value, verbal and visual—which comprise the elements of your brand.
The mistake many advisory firms make is spending most of their time trying to determine the delivery service—the ‘stuff’—(i.e., podcast, blog, video, etc.) and hardly any of their time developing the brand. The “stuff” only works when you get the brand right, first. And the cool thing is if the brand communication is right, most all the “stuff” usually works, assuming you do it consistently.
Let’s take a deeper look at the components of building your company brand and how they work together to develop effective marketing programs.
Three Elements of Brand As The Foundation Of Good Marketing Programs
The Value you deliver is your client experience in total. It is the process of what you do, how you do it, and how you deliver it. Without clarity on what you do and how you do it, adding more marketing ‘stuff’ to an organization is like pouring water into a leaking bucket. Without great client service and a great client experience, you will have little to sell no matter how much stuff you add in the marketing department.
Now, most advisory firms can and do figure out the Value element of their brand enough to get their firms off the ground and establish incoming leads for new client relationships. But often, to increase the lead flow after they develop into more mature firms, firm leaders will jump to the Visual component of their brand and begin to enhance what they look like. In other words, they spend a lot of money on design. This means they will update a website, brochure, etc. to ‘feel’ better about how they look to those on the outside.
The problem is that enhanced design alone, while fun and exciting, does not increase lead flow. The design of any product or service must communicate your value; otherwise, you can end up spending a lot of money on a design that does nothing to generate new clients. Instead, where most advisory firms need to move after they have clarified their value (through mapping their client experience) is not to their visual image, but to the Verbal component that makes up the words you use – it is what you say about the value you provide.
Marketing at its core, is communication. And, what you communicate through words is at the core of all great marketing programs. If you don’t know what you are trying to say, there is no visual picture that will resonate.
In other words, after you have developed and enhanced your value you move to writing, not design. The verbal messaging of your brand is about knowing who you are, knowing what you will and will not do for a client, knowing what type of person you want to attract, and knowing that person’s problem and how to solve it. To write the words to make your brand’s verbal message stand out, you must own your words – you cannot be shy about saying who you are and why you exist. Only then can convincing (and successful) visual imaging be designed.
Your brand and how you talk about it is a comprehensive description of why your firm exists and who you exist to serve; if every single person in your firm has the same idea of your firm messaging and repeats it through their words and actions, then you’ll be able to provide consistent communication to everyone who interacts with you. If different people in your firm have competing ideas about what to say about your firm and/or who you really are, then so will your clients, and thus, so will your marketing efforts and marketing design.
No different than life, if you don’t know who you are and you cannot own your identity with clarity, it’s pretty hard to attract the people you want to be surrounded by. Deciding on and refining your verbal brand—what you say—may be only one-third of your brand enhancement, but it is 80% of the effectiveness of your marketing programs – that is how important it is to growing your firm.
Assuming you have done the hard work of fixing your brand strategy by first prioritizing verbal messaging to make clear who your organization really is before worrying about your visual image, let us now talk about how you are going to communicate to spread your message.
Understanding Marketing Audiences And The Importance Of Intentionally Targeting The Right Groups
There are two major types of marketing processes and programs: external and internal. Whereas external marketing programs go outside of your organization and try to build awareness about your organization to an audience within your target market, internal marketing programs target existing clients and serve primarily as a means of promoting new client referrals.
The three audiences of external marketing programs are strangers, visitors, and prospects. For example, if you are targeting women who need wealth management, you may start with one marketing program that is targeting women who need wealth management, who are strangers to the firm, and who don’t know you exist.
In an ideal marketing plan, you would build programs, one block at a time, for your audiences within your target market, and you would have a program catered specifically to each of these audiences.
In other words, how you communicate your message to a stranger would be different than how you communicate your message to a prospect, and the type of communication method for a stranger may and often will be different than the type of communication method used for a prospect.
When your firm is just starting out, you have no choice but to focus on external marketing programs, because you have no clients. You must start by helping people know you exist, and then convincing them that you are the right person to handle their financial concerns, moving them from stranger to visitor and then to prospect. By necessity, external marketing is every firm’s first entrance into marketing.
However, most existing firms should not spend all their time on external marketing programs; instead, they should also be developing and building their internal marketing programs.
When an existing firm comes to Herbers & Co. with the attitude that their marketing isn’t working for them, it’s usually because they are putting all their dollars into reaching externally for people who have never heard of them and are often trying to increase awareness among people who don’t know they exist. And the worst investment an existing, successful advisory firm can make in growing their firm is to begin with a focus on external targets. Instead, you need to go a different way and put your efforts into internal marketing.
Most marketing consultants do not address internal marketing for a simple reason: it is a hard sell. What if I said to you, I could grow you quickly by focusing all your resources on your client referral rate, and we are going to forget about your lead rate altogether? Exactly.
Another reason you do not see internal marketing out in the open is that it is a function of the ‘internal’ strategy that is intended to provide unique and specifically targeted messaging for clients. Not surprisingly, the companies using internal marketing do not want to be copied, so they keep their processes to themselves. And frankly, if you aren’t a client, you’d never see what they are doing. Internal marketing is what happens behind a curtain that most do not want anyone outside the firm to know about.
Your Greatest Marketing Assets Are Your Existing Clients
You have an opportunity to turn a client into a promoter of your firm every single time you are in front of them, whether that interaction is online or in-person. As you think about the interactions you have with clients, the question your firm needs to answer is this: “How are we going to create more promoters among our client base?” This is the question at the heart of internal marketing strategies… and one that the best firms have answers to.
Creating promoters begins with developing a marketing program that increases assertive communication to your existing clients only. Many firms make the mistake of sending all their communication as external marketing messages to all their audiences. The first step in internal marketing, then, is to give your clients something that external audiences don’t get.
Some might do a client newsletter or a report. I know one larger firm who sends their clients a magazine. But in today’s rapidly changing marketing environment, quick communications to clients letting them know the value of your services work the best. These quick communications can be as creative and relevant as you want them to be.
As an example, here is one we have found wildly effective in COVID-19 in generating referrals:
Subject: Client Digital Technology: Do you know?
During uncertain times, it might be helpful for you to know what digital tools our company has available to you. Here is a list:
- If you would like to review your financial plan, you can log in here.
- If you would like to look at your investment reports, you can log in here.
- If you would like to login to your custodian platform, you can go here.
Herbers & Company could not have ever guessed telling advisory firm clients during COVID-19 what digital tools are available would strike the client to act in sending referrals. It’s certainly not logical. In this case, my guess is it gave the client something to talk about (e.g., the tools their financial advisor has to help them).
The point is, you never know with internal marketing campaigns what will motivate the clients to share with their friends. You simply keep sharing, and in the consistent sharing of information, you continue to provide opportunities to be discovered by new referrals.
Accordingly, the goal is to keep communicating, not simply to communicate with clients when times are hard, or when markets are falling. If you do, your promoter network will give you the highest lead flow through client referrals.
In fact, some of the largest advisory firms I have ever worked with use only internal marketing programs. In other words, they give communication exclusively to their clients, consistently, and by prioritizing client communication, instead of external communication, the clients begin to communicate with their external networks, and this word of mouth marketing is the best marketing of all.
Internal Marketing Is The Power Of Client Referrals
Throughout the history of independent advice, top firms have seen their biggest growth come from referrals. Even today, top-performing advisory firms use client referrals as a standout strategy; for those top advisors, referrals generate almost 19 times their new revenue as the cost to acquire them.
Over the last decade, the narrative has been that referral growth has gone down, and some benchmarking studies have supported that trend. But a slowdown in referrals industry-wide has less to do with clients no longer referring business, and more to do with fewer firms understanding how to structure an internal marketing program correctly, most especially as they get larger.
Now, let’s look at exactly what you can do immediately to begin creating an internal marketing program that works.
A Two-Step Process to Generating Better Referrals
As you grow, your focus will inevitably change with the shifting priorities of a growing firm. Existing firms need to be consistently and constantly communicating with existing clients as their top priority. By doing this, you illustrate to your clients how you are growing. And by showing them your growth, you create confidence in your firm and greater investment and belief in what you are doing. The more your clients believe in you, the more likely they will talk about that belief with others.
To put it simply: If you are an existing firm and you do not begin with internal marketing, you are leaving easy money on the table. Developing an internal marketing program that generates better referrals happens in two initial steps that serve not only to communicate the brand but also to enhance it.
Using A Consistent Message To Identify The Firm’s Value – Internal Marketing Program Step 1
Your program begins by telling each client who you are, who you serve, and the process through which you will deliver your service. In practice, this means your internal marketing begins with your annual client review.
The annual client review meeting gives you a regular opportunity to repeat the script of why you exist, who you exist for, and how you serve your clients. You want to reiterate your message each time you meet with a client, and you also want them to understand how you have changed since the last time you met.
This is the problem you need to solve. As firms evolve and grow, their earlier clients often do not understand how the firm has changed. By narrating that evolution to your clients, you help them see the additional value you are now creating, and you put that communication into your annual review meeting.
As a result, you begin each annual meeting with an update of where your firm is, who you are today, and the types of clients you work with. The repetition of your story makes it simple for them to explain it to others better.
The process here is critical; you must design a repeatable process and script, and you and all your financial advisors will use this process and script in the annual review. At the beginning of the annual meeting, you’ll explain your services and your value to the client. After that is done, you talk about the client and their situation.
A sample of such script that we have seen work tremendously well would be:
We have five primary areas we would like to cover in today’s review meeting.
- First, we will begin with an overview of our firm. We think it is important to remind our clients each year of our mission, our core client philosophies, and who we work with;
- Second, we are going to talk about how we serve you, our process, and where you are in the process;
- Third, we will then talk about you and your financial situation, get updates to your goals, etc.;
- Fourth, we will interactively work through your financial plan and updates to your plan; and
- Finally, we will discuss your investment portfolio.
Before we get started, would you like to add anything to this agenda?
You must have this conversation and follow your script for every review meeting you hold with a client. Whenever you add a new service, change a process, or add a target market, your script should be updated as well.
In my experience, most advisors will not embrace this process even though we’ve proven it to work. They resist it for two reasons:
- One reason is that advisors are taught that client relationships should be all about listening and servicing the client. But when the conversation is one-sided, a true relationship and trust cannot be developed. You must tell your story, in addition to listening to theirs, so your stories can merge into one.
- The second reason is that it all sounds too simple, and people put value on processes and advice that sound complex.
As you integrate this process into your culture, everyone involved in your business will begin to share the same narrative and message. Employees will begin to live it as they repeat it, clients will learn it and repeat it, and then those clients will start to repeat it to other people outside your firm as they become believers and promoters.
Developing A Pool Of Experts To Lift The Firm’s Brand – Internal Marketing Program Step 2
The second step within your internal marketing program is to create and leverage known experts within your company. If you think about it, all the biggest advisory firms in the country are built around a personality. There is a real, human face connected to the brand.
Creating experts in your firm starts with identifying talent in your firm and having them participate in activities that make them comfortable. If you have an advisor who is a great speaker, put them on a webinar or film video for your clients only. People like to talk about people, and when you put your face and other experts in your firm in front of your clients more, the clients talk about those people.
One of the top reasons financial advisory firms do not create a pool of known experts is fear of turnover. What if one of your ‘star’ experts leaves the company? Will the brand suffer?
This is a common fear; however, internal marketing was born out of human capital departments. It was originally used to create marketing programs and brand loyalty targeting employees of companies. Its foundation and principles are rooted in employee management, and the side benefit is a deeper connection between employee and company.
As internal marketing programs grew beyond employee-only marketing programs and into client-only marketing programs and communities, the connection with the brand gets even deeper. As these programs expand, brand loyalty expands with it.
Accordingly, when creating known experts, you must first understand that the goal is to develop a deeper connection with an employee to your brand. As their star power increases, so does your brand power. As your brand power increases, so does the employee’s brand loyalty.
Therefore, we have found it is rare for a company to lose a known expert, and it is important to know that when a known expert does leave your company, it is not necessarily a bad thing. They first got ‘known’ through your brand, and this branding, of sorts, carries with them throughout their career.
Once you begin to develop known experts and as you and your other known experts create content, give webinars, etc. exclusively for clients, you will begin to create a client-only community. What happens when you have an exclusive community? People want to join it. And as you build your client community, your clients will start connecting with others to share your brand content on their own.
Most advisory firms think they need to share all their brand content and communication outside their firm or post it on their website, but clients are the best promoters of your brand if you make them feel like the content is exclusive and special to them.
In other words, when you create a community, people tell others about the community and generally want to share their ‘exclusivity’ with others. But, when the content is going to everyone already, what is the point in sharing? When it is clients-only, it feels more special, and this ‘specialness’ subconsciously encourages the client to share it.
Additionally, giving the client attention that only they receive adds value to the relationship and creates exclusivity that strengthens their connection with your brand. For example, when you sign up for a service like Hulu, you get access to exclusive content accessible only through that subscription.
The content you create should give your clients that kind of exclusive benefit, too. And the cool thing about it is, it doesn’t need to be limited to the target you are trying to attract with your external marketing programs.
There are endless ideas on how to position this content, but here are three of the most effective types of content we’ve seen in generating referrals. Often, this content is sent by email and is also downloadable in the client portal; two tools most all advisory firms already have available to use:
- Associate advisors have created ‘Millennials and Money’ one-page educational downloads for adult children of clients. You would think this would generate more Millennial clients, and in an external marketing program, it might. But in internal marketing programs, Boomer clients tell their friends about the resources you have for their children, as who doesn’t like to talk about what their kids are doing? The result, Boomer prospects call!
- Operations teams within large firms have created step-by-step articles and videos about how best to use the digital technology available exclusively to clients. These articles educate and inform clients on how to log in to portals and use financial planning software, portfolio management software, etc. They are often uploaded into the client document portals. In doing so, clients talk about the technology a firm has available to them with their friends.
- And finally, investment teams have produced assertive articles about investment education and asset allocation. Their pieces consist of bullet points… not paragraphs, predictions, or promises. These are short communications sent to clients by email, which are often forwarded to their friends and family members. Some have even been copied and pasted on client social media accounts. These often generate the most referrals.
As your firm invests in its people and your people create more of their own content for the client, your team will lift your brand, and your brand will lift your team. As it is shared exclusively to clients, your clients end out becoming your external marketing machine. In other words, when you target your clients to spread the message, they spread the message for you without massive external marketing programs.
As you build your internal marketing program, your clients will become your best marketers and your best rainmakers – but it all starts with you cultivating the communication that turns them into promoters. Once your internal marketing program to clients is robust, building, and adding to it each year, you can begin to add external marketing programs, similar to how you started marketing your firm. But you rarely need to return your focus on external marketing until your firm is quite large.
Herbers & Company often gets a blank stare when we explain internal marketing programs to advisory firm clients who have never used them or didn’t know about them. The goal is not to eliminate external marketing programs; instead, the goal is to build internal ones as you grow, in addition to the external programs that were originally in place.
But, if, for some reason, you are like many advisory firms who get busy with clients and your external marketing programs stopped along the growth curve, it’s far better to build internal programs before you spend the dollars on further developing the external ones.
If you want to gauge the potential impact that internal marketing can have on your firm and those around you, then think of it this way: Would you rather have your company post a link to a blog from your own Twitter page, or would you rather have clients taking your video and writings and sharing it on their personal social media accounts to all their friends?
One of these will clearly resonate more with the average person. When your message comes from your clients instead of you, it generates more power, more authenticity, and much more reach.
If you are posting everything you create to your social media and/or sending emails to everyone, before a client has a chance to share it, the client doesn’t feel the need to also share. If you wait for them to start talking and sharing, I promise, they will send you new clients. And when that happens, your client base becomes your marketing machine.
But to do that, you must first have the courage to look at your marketing efforts differently than you have before.