Wealth Management Marketing's Blog: Presented by Kristen Luke

In April 2009, The Nielsen Company conducted a study of the most trusted forms of advertising.  Not surprisingly, the study found that most trusted source is recommendations from personal acquaintances.   A whopping 90% of people surveyed said they “completely” or “somewhat” trusted recommendations from people they know.¹  This study specifically surveyed internet consumers, but if consumers place such high importance on the recommendations of friends for some widget they buy online, you would have to assume the same must be true when choosing someone to manage their money. 

In my opinion, this study further emphasizes the importance of creating a marketing plan focused on relationships.  It amazes me when an advisor will spend money on advertising yet has no plan or process for nurturing existing relationships.  Clearly it seems like the advisor, in this case, is spending more time and effort on the campaign with the lower ROI. 

If you find that you are putting more effort into mass marketing or advertising than you are into your existing relationships, it is time to reexamine and possibly adjust your marketing plan.  While I have no objection to advertising or mass marketing, it is something you should implement once you have a plan in place for cultivating your existing relationships.  Of course there always are situations when you must focus on mass marketing.  For example, an advisor just starting out in the business will not have the existing relationships required to acquire new clients.  He or she must start from scratch and cannot rely on personal recommendations and referrals.   

The Nielsen study establishes that people trust recommendations from people they know.  This doesn’t mean you have to focus solely on your client relationships to provide recommendations.  Anyone in your network can provide a recommendation, so the more relationships you have in good standing, the better off you’ll be.   When you are sitting down this fall to write your 2010 marketing plan, think of ways in which you can utilize your personal and professional relationships and create campaigns that will enhance these relationships.  Here are ten questions to ask to help formulate a marketing plan centered on relationships. 

1. Do you have a plan for communicating with your clients throughout the year (ideally 24 times)?
2. Do you have a plan for meeting new centers of influence?
3. Do you have a plan for staying in touch with your centers of influence throughout the year?*
4. Do you have a plan for becoming/staying involved in the community?
5. Do you have a plan for staying in touch with your community contacts throughout the year?*
6. Do you have a plan for staying in touch with your personal contacts?*
7. Do you have a plan ensuring that you are networking on a regular basis?
8. Do you have a plan for staying in touch with your networking contacts?*
9. Do you have a plan to regularly participate on social networking sites (if your compliance department allows for it)?
10. Do you have a plan to reach out to your social media contacts in person, on the phone or via email (if participating in social media sites)?

(*Note: Social media sites like LinkedIn and Facebook are good options for this)

If you create a marketing plan that allows you to answer “yes” to all of these questions (or at least questions 1 -8), you’ll be on your way to developing strong word of mouth marketing.  Feel free to integrate other forms of marketing and advertising to supplement your relationship-based marketing efforts, but keep in mind that word of mouth marketing is the most effective form of marketing you can find.

Kristen Luke is the Principal of Wealth Management Marketing, a firm dedicated to providing marketing strategies and support for financial advisors. Kristen works with independent advisors to develop effective marketing plans and provides the back office support required to implement the strategies.  For more information visit www.wealthmanagementmarketing.net.

1 Global Advertising: Consumers Trust Real Friends and Virtual Strangers the Most