Marketing Strategies for Wealth Management Firms

Would you advise your clients to manage their own portfolios? Of course, some of them could figure out how to do it—but how effective would their strategies be? And how much time would "figuring out the nuances" carve away from their primary responsibilities? Similarly, financial advisors should consider the drawbacks of executing their own marketing without proper support and expertise.

Deloitte’s annual CMO Survey states that marketing will comprise 13.6% of a company’s total budget in 2023—up 3.9% from the two previous years, and RIAs will spend about 4% of their total revenue.¹ This data suggests that RIA leaders increasingly recognize the value of investing in marketing. Yet, it still often seems to remain an afterthought, despite knowing that the average RIA-client relationship lasts between 15 to 20 years and the long-term return on investment can be substantial.

Across the industry, we see four general approaches: DIY marketing, Platform or Marketing-as-a-Service, In-house Marketing Specialist or CMO, and Outsourced CMO.

Sticking with the analogy of clients managing their own portfolios, we classify DIY marketing advisors as the equivalent of individuals managing their own investments. We can all agree that the consequences of someone without experience, methodology, or the right tools picking their own stocks can be disastrous.

The second category would be Marketing Platforms or Marketing-as-a-Service. These are the equivalents of a robo-advisor designed to “help” the DIY advisor with their marketing efforts. These marketing platforms are basically tech companies that developed pre-built campaigns with canned content to provide advisors with automated marketing. The upside of these platforms is that they give the budget-conscious advisor a “good enough” option for the job.

The downside is that thousands of advisors across the US also use the same platforms, which means everyone is sending out the same canned content. Therefore, clients and prospects nationwide receive the same emails, blogs, and posts from everyone, preventing firms from standing out from their competitors.

Another downside is that these tools don’t solve the “lack of expertise” problem nor provide the level of personalization that highlights a practice’s unique value proposition, brand identity, and message. Given their limited impact, one could argue that these platforms are not necessarily cost-effective but simply low-cost. 

The third category is having an in-house marketing specialist or CMO; this is the equivalent of an individual having their own full-time, full-service family office—which is, in most cases, unnecessary. An in-house CMO could have the right tools, knowledge, and expertise but can be very costly and hard to justify for most RIAs.

The fourth category, which seems to be the trending choice for most RIAs, is outsourcing a specialized Chief Marketing Officer (OCMO) rather than insourcing; this is the equivalent of someone hiring a fee-based advisor. An experienced professional with the tools and time to provide a goal-based approach focused on driving returns for their clients.

The reason for the latter trend is simple: the positive impact on these firms' bottom lines without compromising the quality of their marketing and brand.

¹The CMO Survey, September 2022. Sponsored by Deloitte LLP, Duke University’s Fuqua School of Business, and the American Marketing Association.