Too many asset management firms continue to hold an outdated view of their advisers, defining them as either a "prospect" or a "producer." Producers are courted; prospects are bombarded with sales literature. Both approaches are less than optimal for attracting and retaining new assets in the current market environment and need to be replaced with a more effective framework for communicating with this customer base.
According to a recent kasina survey of more than 1,500 advisers, only one in four indicate that asset management marketing affects how they decide to invest client assets. The situation is only marginally better when it comes to producers. That's why it is now time for asset managers to re-characterize advisers and develop a deeper understanding of how to engage them in a conversation about the firm and what it has to offer. Rather than prospects and producers, we believe that advisers would be more profitably defined using one of the following four categories:
* Strangers, who are either unknown to the firm, or who have no real familiarity with the firm.
* Friends, who have been initially identified and are willing to engage in a conversation with the firm.
* Customers, who are currently doing business with the firm.
* Salespeople, whose relationship with the firm is so strong that they are willing to be advocates for it and engage their peers.
This is not simply a matter of semantics. By re-characterizing the adviser relationship, firms create the opportunity to more clearly differentiate among prospects and to establish a more important top-level relationship beyond that of top producer. At the same time, management can use this new structure to provide the marketing team with a more tightly focused directive for supporting the firm's overall sales goals.
The somewhat infelicitously named Word of Mouth Marketing Association of Chicago has said that 76% of consumers are highly skeptical of what they hear from businesses that are trying to market to them. Clearly, this applies equally well to asset managers marketing to advisers.
In engaging strangers, marketing teams currently commit two important mistakes. First, firms bombard these individuals with materials they don't want and will not pay attention to, including direct mail, advertising and e-mail solicitations. Less than one-third of advisers find any of these activities even somewhat effective. Second, marketers have the mentality that strangers will morph directly into customers, that a switch simply flips and a prospect becomes a producer.
Addressing these issues requires zeroing in on the task of creating friends. This means crafting unique, targeted messages that offer the adviser a reason to enter into a dialogue. Without a two-way conversation, there is no relationship. This is the key first step in developing new customers.
No matter how hard working, the sales force can neither open nor walk through the doors of all the advisers a firm wants to reach. With hundreds of thousands of advisers out there, even the largest wholesaling organizations will be lucky to reach even 5% of the target audience directly in a given year. Therefore, marketing must rethink how it approaches strangers, seeking out unique messaging strategies and other points of leverage that will allow them to "touch" the broader audience with both greater frequency and more emotional impact.
Advisers definitely do listen to and trust other advisers. Thus, develop salespeople who can bring the firm's messages to more strangers, friends and customers.
Unfortunately, few organizations are working today to turn customers into salespeople. In fact, financial services is one of the worst industries in the world when it comes to employing customer advocacy in support of a marketing program. While there's no doubt that creating salespeople requires extra effort, first to engage customers and then to link them in a productive way to prospects, exclusive access to value-added content and personnel such as portfolio managers, and the regular solicitation of client feedback are just a few of the ways that businesses can create true fans. Salespeople can then be utilized to spread the messages of the firm via printed marketing collateral, the website, conferences and a variety of other mechanisms.
Barclays Global Investors, with its iShares website, is one firm that understands the power of salespeople. An entire online section is dedicated to "Adviser Stories," with first-person adviser accounts of how iShares help them address key client needs. This isn't Barclay's telling advisers to buy its products; this is a peer-to-peer communication, leveraging the power of word-of-mouth marketing.
A new relationship model can ultimately help the marketing team redefine its strategy and execute better from a tactical standpoint. By helping the firm make new friends and create and leverage the goodwill of its salespeople, marketing can increase the reach and effectiveness of the firm when it comes to finding new advisers, expanding existing adviser relationships and, ultimately, bringing in new assets.
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