I’ve been running a terribly unscientific survey to find out if advertising for lead generation is dead for todays financial advisers. Basically the deeply analytical process has consisted of me asking advisers continually for the last couple of years whether they are doing any advertising, and what results in the way of new enquiries (or prospects) from it.
Sadly the answers are mixed….but a clear trend has been emerging based on the collective experiences of a decent number of advisers.
The trend appears to be” traditional advertising is dying in effectiveness”.
The “mixed” part of the answer is that for most advisers there are generally poor results from traditional advertising methods – but there is a clear exception. The old Yellow Pages, leaflets in the neighbourhood letterboxes, advertising and running a complementary seminar for strangers, direct mail….that sort of stuff has lost its oomph. So have the advisers trying to use it. They’ve lost their oomph too.
The exception is when they are choosing to compete on price.
When advisers have an authentic offer based upon price, such as guaranteed cheapest insurance, or lowest cost investment fund then traditional advertising appears to have some impact. An authentic offer based upon price does have its catch however: it is a transaction based upon a product sale. It is not selling the adviser or the value of advice. It is not selling the continued relationship or future benefits that an adviser might be able to deliver. It is getting someone something that they think they want now, and offering it at what they perceive as the best price. Highly transactional in other words. But that is ok if your business model business model is based upon moving productsa in volume to consumers. In that case then there certainly appears to still be some merit in traditional advertising methods.
It is possible of course that there is still merit in those methods because the transactional price-driven consumers who purchase an insurance policy or retirement plan on the basis of an unsolicited direct mail piece or advert in the paper are the same people who have three miracle ab-maker machines under the bed, and 17 sets of free steak knives that came with various vacuum cleaners, blenders, and “massagers” via the infomercial channel.
Perhaps this type of advertising attracts the consumers who will buy anything just because it seemed like a good deal – whether it was something they needed or not. More significantly though, I suspect the majority of the consumers who are moved to purchase a product on price will just as quickly move on to another vendor and another product when they perceive a price advantage to themselves. So I think the transactional customers will by and large remain transactional – easy come, easy go.
However, I am increasingly seeing advisers who are generating successful enquiries that convert into good clients paying fees from digital of advertising tactics. Advisers are definitely picking up clients from Facebook and LinkedIn advertising, and generating enquiries from blogs and websites. And they are definitely getting leads and enquiries of substance via local search and Google advertising.
When it comes to advertising for lead generation then it seems pretty clear to me that “online is where it is at”. That is even more true when one compares the costs of the different advertising mediums.
So what do these newer advertising methods do, or have, which is different to the the old direct mail in the letterbox?
There are a number of things of course, but the most relevant ones I believe are:
Traditional is disruptive – it is an intrusion – whereas the digital is often a barely noticeable thing on the periphery or, even better, it is one where the consumer is actively looking for answers.
Traditional is literally a “one-off” piece of awareness whereas the digital tends to be a more constant presence. The direct mail piece arrives with great fanfare and relatively high expense, and typically has little or no follow up. The digital advertising remains in view repeatedly for the same budget as the traditional advertising.
Traditional advertising and marekting methods don’t seem to get shared. They tend to make a one-way trip to the recycling bin whereas digital gets further circulation via likes, shares, interactions and so on.
The Big One: digital puts control of the buying journey in the hands of the consumer. It is effectively a “pull” strategy that taps into modern consumer behaviour. Consumers do a LOT of searching now. We (as consumers) use Google to settle debates, find a parking spot, see what’s on in the area, or find out about setting up a will. Consumers use search for nearly everything that they need information on – including finding professionals or getting financial solutions.
My completely scientific research suggests to me that advertising is not actually dead as a way of generating new leads or enquiries. It It can’t be dead because people are buying more and more stuff than ever before, and they are finding out about it through advertising and advertorials, through testimonials and recommendations, and through constant repetition of brands and messages that are on the periphery of their digital world.
Advertising works. Just not that advertising that financial advisers used to do – that is decreasing in effectiveness by the day. Advertising in the places where people are looking for their information and entertainment, where they are searching for answers to everything, well that seems to be working just fine as far as I can tell.
So for any advisers wanting to generate more leads then it seems that advertising can help – but go online. That’s where the discerning consumers are who are more likely to become good advice clients.