Why would an adviser choose to pay for advertising when getting your name out there through traditional PR channels is free? Although I encourage you to try a traditional PR approach before spending money to create and place an ad, there may be times when paying for placement makes sense.

Consider the potential mix of marketing activities in the chart I've created for how, in general, advisers should spend their marketing capital (see "The Ideal Marketing Porfolio" below). Notice that 80% of the marketing effort is dedicated to activities that will either put you in front of people in person (speaking, networking, volunteering, hosting events) or through a traditional PR approach (media coverage via radio, television, internet or print publications). As you develop and refine your marketing plan, you will want to create a portfolio of marketing activities that, just like the investments in a portfolio, work together to produce results over time. Since this is a people business, you should not rely on advertising or direct mail alone--you've got to get out to meet, greet and mix with the right people. However, if you have the proper foundation in place, you can use paid advertising and targeted direct-mail pieces to build name recognition and create a familiar brand.

A good example of why you shouldn't rely primarily on advertising comes from Jim Ludwick (www.adviceonly.net), a fee-only financial planner with dual offices in Maryland and California. He was sure that targeted advertising coupled with seminars would create new business. "My first year in business was 2003," he says. "I spent several thousand dollars on a campaign with a quarter-page ad trying to attract the attention of 25,000 civilians and 4,500 military who read a weekly newspaper in my town. After 13 weeks, I had not received a single telephone call from the ad. This was the most money I ever wasted. Think of how many attorneys and accountants I could have taken to breakfast, lunch or dinner for those kinds of dollars. Even worse, I signed up for three different yellow page ads, totaling over a thousand dollars for the year. After one year, I received only one call--a wrong number. The second year I spent my time and money taking attorneys, accountants and other referring advisers out to breakfast and lunch. I spent less and the results were staggering in comparison."

Bert Whitehead (www.bertwhitehead.com), founder of the Alliance of Cambridge Advisors, and the Alliance in general eschew advertising. "General advertising is not the mark of a real professional," he says. "The best doctors, lawyers and therapists don't resort to advertising for this reason. I have never heard a success story from any professional financial planner who has advertised--not including directory listings--and every adviser I know who has tried it found it to be a waste of money." On the other hand, good PR can generate a landslide of inquiries. "About 10 years ago the Detroit News ran an article about our firm and fee-only planners," says Whitehead. "We were so swamped with inquiries, our clients complained about not being able to reach us."

Many advisers who are struggling to generate new business would embrace such a problem. But planners who've had trouble working traditional PR channels may feel compelled to advertise. This is the case for one new planner who said, "If you can't manage to get your name out into your community and gain recognition free through press releases, event announcements or articles, paying is the only other thing you can do. Unless you have tons of contacts who will pass on your name, the fastest way to get your name out there is advertise." This planner is doing the right things: She has a website, networks within the business community, speaks on financial matters and has an ad in the yellow pages. She's been quoted in national publications four times in the past six months, but she has failed to garner any local media interest, even though she's tried.

She asked if I thought it would be a good idea to spend $1,000 a month (with a four-month minimum commitment) to participate in a local ValPak mailing, a coupon package that would go out to 160,000 people in her area. "I know I always check the coupons," she says. "And it's cheaper than if I bought a list and did my own mail-outs." My advice: Don't do it. Discounting your services alongside plumbers and carpet cleaners will not create the professional image you need. Keep building relationships and network like crazy. Use that $4,000 to begin a drip-marketing campaign, and ask a PR professional to help you fine-tune your media pitch.

THINK LOCAL AND LONG TERM

My overriding message is that you should be utilizing all the other PR methods such as peer networking through professional organizations, giving advice through local publications and radio stations, hosting seminars for the public and events for clients, sending out regular emails and literature to clients and potential clients and volunteering with local charities or social organizations. If you still aren't getting enough business, you might add targeted advertising to the mix. But there are right and wrong ways to advertise.

Neil Collins (www.collinsfinancialadvisors.com), an East Coast newspaper executive who transitioned to a career in financial planning three years ago, says that print advertising can actually work--especially in newspapers. But there are some important caveats. You have to choose your market carefully and have realistic expectations.

For most advisers, that means thinking local and long term. Unless you serve a national, regional or statewide clientele, it doesn't make sense to do anything other than advertise locally. Bigger publications with larger distribution will cost more, and it's less likely that your target clients will see and remember you. Even local advertising can be expensive; depending on the publication, ad size and frequency, a campaign can cost $5,000 or more per year.

"You don't need to run big ads--just the opposite," Collins says. "Running smaller ads more frequently works better. I'll run a series of ads for eight to 10 weeks, then go dark for the same period. In my town of 30,000, the local newspaper is looked forward to every week and very well read. With good placement--typically my ads are on pages two to six--I get a lot of prominence."

If I were in a metro area, I wouldn't advertise in the daily paper; there is too much clutter to be seen, and it is way too expensive to get the accumulated exposures you need to be successful. Even planners who work in large metropolitan areas should look for smaller, more targeted publications such as a weekly newspaper, local business journal, community-specific magazine or association newsletter. Inquire about special sections: For instance, The Washington Post has customized sections and inserts created for specific neighborhoods.

Jamie Milne, the immediate past chairman of NAPFA's board and owner of Milne Financial Planning (www.milnefeeonly.com) in Barre, Vt., agrees. "For newspaper advertising to work, it has to be continuous," he says. "I run ads six to nine months of the year. People will tell me, I saw your ad in the paper' even when I stop running it for awhile. I think when it is seen month after month and year after year, the reader begins to realize you are serious about your practice and will be around for awhile. I also think it serves as a reminder to other professionals that you are out there."

Milne says he gets enough calls from his ads to cover their cost. In fact, his highest-net-worth clients are divorce-related cases who found him from a local newspaper ad or through the yellow pages. He runs a small yellow pages ad in three phone books for $3,600 a year and a medium-sized ad in the Barre Montpelier Times Argus for $3,600 to $4,500 a year.

REALISTIC EXPECTATIONS

Having realistic expectations means you don't confuse yourself with a retailer and try offering 50% off. "A print ad campaign will drive business your way, but it's a slow process," says Collins. "Like the plans we make for our clients, newspaper ads involve longer-term investments. They're not quick hits." He stresses that print ads should be part of the total marketing campaign. "For people who have seen your news releases, heard about the public speaking engagements you've had, visited your website and talked to their friends about the services you've provided for them, that newspaper ad is just one more affirmation of your status as a serious, qualified financial planner," he says. "A realistic expectation is that your ads will give potential clients another way to think about financial planning and when they are ready, they will naturally think of you."

These ads should have a consistent look and feel so readers will begin to recognize them as yours, Collins says. He aims for headlines that pose thought-provoking questions/statements such as:

• What's the Right Day to Start Planning? How about Today?
• Don't Let Your Financial Plan Take a Vacation!
• Who's Working in 2020? You or Your Financial Plan?
• Afraid to Open Your 401(k) Statement?

Collins doesn't spend his money on ads in the yellow pages because he gets a number of inquiries each year from the free listing.

TRIGGER POINTS

Remember, financial planning is event-driven, so a good ad will mention specific situations that call for planning services. "People just don't wake up one morning and say, 'Gee, I think I'll call a financial planner,'" says Ron Kelemen, an Advisor Affiliate with The H Group in Salem, Ore. (www.planningvisionprocess.com). Something in a client's life--such as impending retirement, a sudden inheritance or the birth of a child--will trigger the call. People may also have had an unsatisfactory experience with another adviser, be subjected to family pressure or see an article or newscast that moves them to action. When that happens, you want top shelf space in their minds. A good ad can help trigger the need to see a financial planner, and it can help jog a potential client's memory when the triggering event occurs.

A 24-year planning veteran with $80 million under management, Kelemen has had plenty of time to test just about every marketing method. "In my earlier years, when I was doing seminars, ads worked well," he says. "Now, I design them so they are more image-based. I simply want to tie in with and reinforce our name recognition and branding."

Kelemen not only keeps the ads extremely local, but he targets them to a high-net-worth crowd. "I mostly do image ads in publications where I would enjoy having like-minded clients," he says. He advertises in the symphony program, the Assistance League (where his wife is highly and visibly involved) and the Medical Society Directory (in which a full-page tab section has worked nicely). "In my business, just one really good client pays for the ad for many years to come," he says. "I help sponsor local charitable events, which is a very tax-efficient way of helping local nonprofits and possibly getting clients in the process. The affluent are also involved with the arts and charities, and when they see the ad and you are at an event, it helps remind them of you and your services."

Kelemen has run yellow page ads in the past, with mixed results. "We probably won't continue them next year; however, you need to make it easy for people to find you, so I'll pay a little extra for the bold white-page listing with my name, as well as our company name, and at least a bold listing in the yellow pages."

SOCIALLY ACCEPTABLE ADS

Placing an ad in a local church or school directory also helps you avoid the social awkwardness of approaching people you know at your church or other nonbusiness organization. Minnesota sole practitioner Bob Davis (www.financialcompass.com) runs small ads in the community directory as part of a long-term, image-changing strategy. "In the past, people knew me as just Bob," he says. "Now people are getting to know me as Bob-the-financial-adviser in a subtle, socially acceptable way. Due to the low cost, I could run the ad for several years. It will take only one client to more than pay for it."

Advertising has helped Michael Potito and his partners at Singer Potito Associates (www.singerpotito.com) in East Longmeadow, Mass., to build a strong business. With $100 million under management and a fee-only structure, the firm maintains a website, pays for a small print ad every other week in the local weekly paper and advertises once a week on National Public Radio during fundraising drives. The firm also has yellow page ads under "financial planning consultants" and "investment advisory services" and helps the local Jaycees sponsor one of the largest fireworks displays in the area. The Jaycees put up signs at strategic locations announcing the sponsors. "Existing and prospective clients routinely say, 'We hear and see your ads all the time.'"

Advertorials, too, containing a story about you and your practice, a photo and a traditional display ad, can be effective. Rebecca Pace, with Pace Advisers in Cincinnati (www.paceadvisors.com), writes the stories with the help of a virtual marketing assistant and runs them once a month in the Community Press, a Cincinnati weekly. "They focus on different practice areas, depending on the newspaper's editorial calendar," she says. The stories are just 450 words, but it's not uncommon for prospective clients to bring the clipped-out advertorials along with their records to their first appointment.

There may be times you decide to provide advertising money just to support a friend, client or charitable organization, by placing a congratulatory ad in the event program or directory. "Some of my best clients ask me to sponsor events with which they're involved," says Kelemen. "They are good causes and I get some PR out of it, but it's also a wonderful way to support my clients. Sometimes I feel I just can't do enough for them. This is one way in which I can, by helping them meet their board-member commitments to get sponsors or advertisers."

Wherever you place your ad and whatever your motivation, remember that some of the benefit from an advertising campaign can't be tracked. The ad may be one of several reasons that a potential client picks up the phone to call.

Marie Swift is a marketing consultant and president of Impact Communications (www.impactcommunications.org). She writes frequently for Financial Planning.

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