As a longtime investment advisor, I have never walked into my office and thought, “Finding clients is so easy.”

Our industry is competitive, and clients are difficult both to engage and to retain. A good client stays with his or her financial advisor for approximately four years, according to my conversations with custodians — and that’s not very long. In order to get that client and keep him takes frequent, active engagement and re-engagement.

As a result, for advisors, marketing is a central problem. How do I get to Jane, get her to trust me, and get her to ask me to manage her money? Making that happen at a reasonable cost is problem number one, and keeping Jane happy is problem number two. There’s always another advisor whispering in the clients’ ears, who’s going to make you feel like you could be doing better.

To increase retention, advisors need all the help we can get — and that’s where technology comes into play.

DATA FOR CREDIBILITY
Traditionally, we think of two ways technology enhances engagement: through 24/7 access and through aggregation of data.

Of the two, the most common vehicle for enhancing client engagement is data aggregation. In practice, that can translate to integrating your CRM with your portfolio management function or aggregating multiple accounts into a single report in order to facilitate unified advice.

These types of aggregation work well with traditional forms of client communication. Say, for example, your client calls with a question about her portfolio. If daily performance data is integrated with your CRM, you have all the information you need at your fingertips, from the value of her investments and your previous conversations about asset selection, to the name of her new grandson (and her plans to start a college account for him). This instant access to integrated information makes an advisor’s life much more streamlined, once the initial effort to input information is complete.

Equally important is enabling end clients’ to have 24/7 access to their portfolio data. This is old as the hills — day traders could check their online portfolios back in the 90s — but new again, as more people turn to digital advisors and client portals.

What’s more, with increased processing power now ubiquitous, innovative ways to aggregate data have emerged and with them, new intelligence. At this point, big data is new enough that it’s hard to tell what’s real and what’s vaporware. But soon enough, analytics will help advisors figure out who needs extra attention, who may be able to provide a new referral, and more.

SOCIAL LISTENING
Social media listening promises to help you identify moments of opportunity. Say Harry, a longtime client, announces the birth of a grandchild on social media. Now you can say, hey, congratulations, want to set up a college account? Instead of a client calling you, you can call the client and be proactive. Little Bob is going to college, Julie is getting married, etc.

Today, only early adopters are using this strategy. You have to balance being on the cutting edge with being a “creepy” client stalker. Several software providers enable you to set up ongoing keyword searches that will help you tract people announcing a child, grandchild, new job, or even a divorce.

To succeed with a social approach you need to be diligent about collecting the flows. Announcements are made, then buried in the stream, so you have to listen daily. Ten years from now, it’s likely that we’ll all be doing this — at least if you believe the predictions by IBM and Schwab Institutional.

Social listening will change the industry, but only marginally. Maybe a widget will get into my dashboard and suggest action that goes straight into my calendar. That will make marketing operations easier, and client acquisition and retention more competitive. Once these tools are universal, it may become more difficult to find money in motion from unsatisfied clients. The early adopters will benefit for a few years, then it’s game over.

CLIENT ACQUISITION AT SCALE
Advisors meet tons of people — it’s part of our job. The difficult thing is to create a system that lets you harness the power of these relationships. It’s hard to talk to Joe about a portfolio idea at your kids’ soccer game, but you can email your prospects and track responses.

Attracting younger clients requires a different playbook than you used for the baby boomers who make up the majority of today’s clients. They are native to online communications and can play with data. But you have to hit them at the right time. Joe at age 22 doesn’t even know how to compare portfolios. He wants something easy, like a robo advisor.

But by the time he reaches age 40, Joe does care. He has more money and less time, and his life is probably more complex. Now Joe wants to think about a more nuanced investing strategy, and he can look at your ideas without disclosing his assets. I can use a platform like Emotomy to create a pro forma of Joe’s brokerage account and track it against my portfolio, other clients’ portfolios. We want the end investor to feel like he can discover without pressure, see what people are doing.

Your prospects don’t need to be data scientists — but for these tools to work, they do need to be interested in their money, to understand that financial planning is more like going to the doctor than going to the car mechanic. Clients attracted by these tools tend to be attuned to their investments, to be involved and to take care. They are not looking for a simplistic solution. This helps you attract qualified prospects who appreciate your value and are willing to pay for it.

If you’re looking to expand your outreach, and make your marketing more efficient, in addition to investing in Google Adwords and sponsored Facebook posts it’s helpful to look within your office and see how you can improve communication through the tools you already have. Creative uses of data aggregation and social listening should accessible. If they’re not, it may be time to start looking for some new tools.

Patrick Beaudan

Patrick Beaudan

Patrick Beaudan is CEO of Emotomy, an investment and robo platform based in Tiburon, California, and CEO of Belvedere Advisors.