When Kevin Keller took the top spot at the Certified Financial Planner Board of Standards in 2007, the organization, then based in Denver, was facing a crisis of confidence among many planners throughout the industry.
It didn't help that when Keller arrived, the organization was on its seventh CEO in as many years.
Now, nearly five years after relocating to Washington with a staff of just five, the CFP Board now carries an employee count of about 60, the number of certificants has soared, and the organization is actively engaged in the policy debates that figure to shape the regulatory landscape of the industry.
In an exclusive interview with Financial Planning, Keller talks about how far the organization has come, where it's going, and how it plans to further the professional stature of the financial-planning industry.
Read Part One of this interview, CFP Board’s CEO Discusses Group’s Continuing Evolution
Financial Planning: What are your biggest public policy priorities heading into 2013?
Keller: As we look ahead we would point out a couple areas. One we've been working on is a fiduciary standard for broker-dealers. We continue to work in the area of investment advisor oversight. And one of the real priorities of the Financial Planning Coalition and built right into our work that we do with the Financial Planning Association and NAPFA (the National Association of Personal Financial Planners) continues to be the regulation and recognition of financial planning as a profession.
Turning to your marketing campaign, last April, you launched a four-year, multichannel public-awareness campaign to raise the profile of the CFP professional. Is that campaign entirely an effort to educate the public about the credential itself and to draw a contrast between the advisors who have it and those that don't, or is it also serving as something of a recruitment tool for your own organization in an effort to bring more financial professionals into the fold?
Keller: I'm not sure if it's an either/or, but maybe if we take a step back. Remember I said there was a deficit in the trust bank? One of the first things we did was start going out and talking to CPF certificants in town-hall meetings, and so the origin of the campaign came from the certificant community. And what they told us when we went out on the road was that they wanted more awareness of CFP certification. And the conversations would come up organically, kind of in a free-form, town-hall-style meeting. It was surprisingly consistent from city to city: "I've worked really hard to earn my CFP certification. I feel good that I've accomplished the task. I feel like I can provide my clients better service." And then they'd say, "I just wish more people knew about it." And so there was a real clamoring for CFP certification [awareness].
The primary objective of the campaign is to increase awareness of CFP certification among the public. To your question, though, to be direct, is it designed to recruit? I think that we would suggest that with nearly 67,000 CFP professionals, and a mission that is large -- of benefiting the public -- 67,000 is not enough to serve the public. And so we think that in order to achieve that mission we need more CFP professionals. That is not the primary mission of the campaign, but interest in CFP certification has increased noticeably since the campaign launched.
As you are certainly aware, there are some critics that have received the certification and pay the annual certificate fees and complained that the ad blitz isn't worth the increase in fees. How would you respond?
Keller: Well, the additional $145 a year -- that's what folks are paying -- we think is a small price. And that $145 would not go very far if it was just one person. But 67,000 people coming together spending $145 makes a big difference. The data point I will share with you is that our retention rate, in other words the percentage of people who are invoiced and pay on an annual basis, is 96 to 97%. We knew from the initial research that we did that there were 3 to 5% of the folks who would be opposed. We understand that. But the board of directors felt that for financial planning in general and CFP certification to become more well known, that this was a modest additional fee to help achieve that effort.
Do you anticipate any major change in the course that the campaign is taking after the two-year review?
Keller: I don't know. We've been pleased with some preliminary results that show the increase in unaided awareness among our target market. The numbers have gone up.
Keller: Right. We said the goal of the campaign is increasing awareness, so "How?" would be the question that I got when I was out on the road selling this concept. "Well, how are you going to measure effectiveness?" And I understand that concern. Going right to the goal, the goal is to increase awareness so we have a baseline measure of awareness before the campaign began. And it's not awareness of 340 million Americans; it's awareness of our target market. And the baseline awareness is a combination of unaided awareness and aided awareness. So if you think about it, if you were part of the sample that we surveyed, we would say, "Kenneth, tell me when you think of financial planning designations, which ones do you know of?" And let's say you were an enlightened individual and you said, "Well, I know of the CFP or the certified financial planner."
The people who could unaided say either CFP or certified financial planner, we count those as unaided. I think those are the most important people, and we've seen an increase in that. And then the total awareness is when we'd show CFP, PFS, CLU, CHFC, CFA, and we'd get a total picture: "Oh yes, I know CFP," or maybe, "I've heard of PFS" or one of the others. We've had good increases in the unaided awareness after one year of the campaign. I do not anticipate major changes in the positioning of the message for CFP certification.
And the complaints about the fees?
Keller: Ninety-seven percent are renewing. People can complain and I understand it. It is a lot of money and these are tough times. But in the end, when you look at the perception of value -- is CFP certification worth renewing and maintaining? -- 97% of the people are saying yes.
Since I arrived, we've grown from 54,000 and change to almost 67,000. We're up 22% in five years. Think about that. That's in the toughest economy in three generations, we've grown the number of CFP certificants over that period. And I think that speaks to the value perceived.
Check out Part Three: Attracting the Next Generation of CFPs