Financial advisor firms are still growing, but not as fast as in recent years. You can buck the trend towards slower growth — and keep expanding revenues and profits — through market marketing strategies that focus on your largest, highest quality clients and prospects.
Revenue growth at independent advisor firms has moderated significantly, says a 2016 Financial Performance Study sponsored by Pershing Advisor Solutions and the Ensemble Practice Group. Revenues increased by 8% in 2015, about a third of the growth rate in 2011 (24%) and down by half since the year previously (15% in 2014).
As a result, more than half (54%) of the firms participating in the study missed their growth targets in 2015, largely, because of poor marketing habits, the survey says.
The survey found intriguing results:
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A surprising 62% of firms never tracked the leads they generated. They had no idea how many leads they had had in the previous year, or where those leads originated.
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Nearly half of the leads they did generate (46%) never became prospects. No phone calls, no appointments, and no email outreach – these leads were outright squandered.
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Of the ones that firms did engage with, only about one third (33%) ever became clients.
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In total, one of every five leads became a client.
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Only 21% of firms set individual business development goals for their partners (a step that can greatly enhance accountability).
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Of all marketing methods used, from community involvement to social media, no single method was scored “very successful” or “extremely successful” by more than 35% of firms. The majority of methods were only considered “moderately successful.”
The good news, however, is that a sizeable minority of high performing firms significantly outperformed the average by focusing their marketing efforts on their largest, most profitable clients and prospects. These top performing firms averaged 11.6% in revenue growth versus 7.0% for all others. They also had nearly double the operating margins and almost twice the assets under management per professional as other firms.
You can learn how to increase the power of your marketing activities by downloading “Mission Accomplish: 8 Strategies to Help Your Business Take Off,” a new sponsored white paper from Premier Trust. Click here for more information.
