Expectations for a return to pre-pandemic business models in wealth management are rapidly evaporating. Some of the changes we’ve seen in 2020 are here to stay. Virtual meetings, online networking and remote client service are now embedded in our culture.
That poses some new challenges for advisor marketing programs. In 2021, competition in the wealth management space will continue to intensify, particularly when it comes to online client acquisition and retention. Without face-to-face interaction, how will firms differentiate from each other?
Finding a solution begins with understanding the underlying obstacles that are preventing some firms from thriving in this new environment. Resistance to change is one of the most prevalent of these. Failure to modernize technology is another. Let’s begin there.
Embracing Evolution and Overcoming Digital Disorientation
The digital evolution of wealth management has been underway for over a decade. Lockdowns and quarantines didn’t initiate it. They simply accelerated an already existing process. Financial advisors who have resisted that have struggled in recent years.
A number of financial advisors have been frustrated in 2020 by a condition known as “digital disorientation.” They have difficulty running Zoom meetings or setting up cameras and backgrounds. Many of them have been hoping these actions won’t be necessary next year.
There’s a popular prayer that asks for the serenity to accept the things you cannot change and courage to change the things you can. Think of that as a business mantra for this next phase of wealth management evolution. It’s happening. You can’t change it. Focus on innovation.
Differentiation Strategies in a Virtual Environment
The movement towards virtual advising and remote practice management necessitates the development of new differentiation strategies. This goes beyond posting mission and values statements. Landing pages need prominent branding. Social media is your storyboard.
Wealth management is a relationship business. Advisors have become accustomed to establishing and building those relationships in person. How do you grow your practice when in-person meetings are limited? Start by setting yourself apart from competitors.
One of the key differentiators for financial advisors in a virtual environment is the quality of the online client experience. Where once we worked on polishing our personal presentation, today it’s all about user experience, online reporting and remote client service.
Implementing new processes in these areas may require modification to your analytics and a rethinking of which Key Performance Indicators (KPIs) you want to pay attention to. Close rate is always important, but the sales funnel deepens considerably when you’re prospecting almost exclusively online.
Narrowing Your Niche Market Messaging
Disseminating educational content and engaging in social media conversations are great ways to establish yourself as a thought leader. Unfortunately, everyone will be doing that next year. Narrowing your niche market messaging is the only way to differentiate in this area.
Let’s say your preferred niche market is airline pilots. Granted, a lot of planes aren’t flying right now, but this profession pays well, and pilots are typically great clients who leave financial decisions in the hands of their financial advisors. You manage money. They fly the plane.
Under pre-pandemic conditions, you could market to this niche with some general content and a lot of word-of-mouth referrals. Chances are, you were the only advisor in your circle who serviced airline pilots. That is no longer the case.
Online marketing widens the prospect pool. That’s not just for you. Every wealth management firm in the country is now targeting certain niche markets and flooding them with content and conversation threads. To compete, you’ll need to narrow your niche market.
Start mentioning specific airlines in your content. Another option would be to talk about the development of certain technologies used in airplane operations or development. Target certain groups within your niche with content they want to read. That’s how you stand out.
Expressing Personality and Values with Online Engagement
This is an area where traditionalists tend to struggle. If you model your website after what you see online from established players in our industry, you’ll look like everyone else. There’s no personality in those websites. To truly differentiate, you need to be different.
Professional website designers will tell you that every element on your home page can either make or break a company online. In 2021, prospective clients won’t come to your office, meet you in person and sit for a chat. They’re coming in online. Will your website convert them?
Start with branding and colors. If you have no experience with this, hire a professional to do it for you. Online users are attracted to images and have short attention spans. Make your logo stand out and use colors that entice them to stay on the page for a while.
There’s real science behind this. Certain colors instill joy in people. Others make them gloomy or depressed. Which do you think you should use? There are also colors that project trust and an outgoing personality. Design your home page with the right combination of these.
Mission and values statements are important and should be included on your website, but don’t lead with them. The home page, or landing page, should be concise, understandable, and designed to capture the visitor. It should also be different from everything else they see.
Accelerated Growth to Outpace Your Competitors
By embracing our industry’s evolution and overcoming digital disorientation, you open the door to accelerated growth for your firm. Each of the suggestions I’ve made in this article can help you do that, but not until you’ve accepted this new direction for wealth management.
Differentiating your firm from others online is the key. Creating a great user experience, implementing new technology, and building a unique digital footprint is how you accomplish that. Targeting specific niche groups and sub-groups will give you an edge over competitors.
Mourning the glorious days of yesteryear is human nature, but there’s truly no reason to be saddened by what lies in front of us in 2021. Wealth management has been heading in this direction for a while. Embrace it now and you’ll grow faster than ever before.
Dan Sondhelm is CEO of Sondhelm Partners, a firm that helps asset managers, mutual funds, ETFs, wealth managers and fintech companies grow through marketing, public relations and sales programs. Click to read Dan’s latest Insight articles and to schedule a complimentary consultation.