When I first joined Dynasty Financial Partners as a digital marketing specialist two years ago, with no background in financial services, I had a ton of questions for our network of 50-plus registered investment advisory firms.

Coming from the world of ultra-high-tech digital marketing in Silicon Valley, I had a lot to learn about my new industry.

At the top of my burning list of questions, shortly behind, “What exactly is an RIA?” was, “How do independent advisors identify new prospects for their business?”

Overwhelmingly, the responses I heard from our network of advisors was, “referrals!”

Although the source of these referrals ranged dramatically from centers of influence such as CPAs and lawyers to clients with specialized needs such as those going through a divorce or an initial public offering, pretty much all our advisors’ pipelines relied heavily on word-of-mouth referrals.

Although I was largely a stranger to this referral-centric world of high-net-worth and ultra-high-net-worth advisory, the concept of referrals certainly was not new. In the high-tech world, we did not rely on word-of-mouth referrals, as I had learned RIAs do, but we did depend on influencers (or advocates) to share feedback and opinions on products and experiences through digital channels.

Instead of talking to a friend about how their experiences with our products were, they would instead tweet their opinion or maybe post a review to their blog. We would track these “digital referrals” through web-browser cookies to determine the reach of this individual’s message and any relevant actions others may have taken in response to this influencer’s tweet or blog post.

Essentially, our goal was to put a relevant message in the digital hands of an advocate with the understanding that their trusted voice would amplify the message in a natural, trackable and highly scalable fashion. It would not be uncommon to generate millions of qualified views and engagements through these influencers on posts that maybe only took a few minutes to compose.

So how does this concept of digital referrals work in an industry that has relied on word of mouth via deep personal relationships for the past 200 or so years? The answer is that it is really not so different.

Let’s look at a real-life example (firm and client’s names changed for privacy):

Polar Advisory has broken away from a wirehouse environment and transitioned to an RIA. Prior to becoming independent, it hasn’t been able to market via social media beyond accepting and sending LinkedIn connection requests.

The firm has never used a corporate LinkedIn page before creating a brand-new business page for Polar Advisory. By adding a follow link to the LinkedIn page in its email signatures, two existing clients follow the page.

The Polar Advisory team decides to post a Financial Planning article that covers trends in the RIA space, as it reinforces some of the key reasons that the firm decided to go independent. At this point, the total reach of this LinkedIn post is a whopping two views (from the clients who initially followed the page).

One of these clients, Sharon Smith, comments, “Interesting!” on the post. She is a UHNW biotechnology entrepreneur in Boston and has 500-plus connections on LinkedIn consisting primarily of other biotech entrepreneurs or industry figures.

The moment Smith writes her comment, likely without realizing it, she has triggered LinkedIn’s algorithms, and immediately a portion of her many connections will see a post in their feeds that reads along the lines of “Sharon commented on Polar Advisory’s update.”

By commenting on the post, Smith just potentially exposed the Polar Advisory brand to her 500-plus peers. That whopping two views is now closer to 500 qualified views, and this was with a single client commenting on a single post.

Smith’s connections don’t just see that she is an advocate for the Polar Advisory brand but are also likely exposed to the brand for the first time.

After three months as a firm, Polar Advisory is able to scale up this process and has now exposed its brand to about 5,000 qualified unique visitors (second- and third-degree connections of clients, prospects, centers of influence, etc.). About 40 of these have walked through their front door for an in-person meeting, all without spending a cent.

The intention of the Polar Advisory case study is to draw parallels between a traditional referral and this new-school digital referral. By posting just once a week to the corporate LinkedIn page and analyzing the relevant data, an advisory firm will begin to expose its brand to relevant connections in a no-cost highly scalable model.

Digital marketing is not getting any less prominent, and by failing to adopt new prospecting techniques firms risk being left in the dust.

Justin Barish

Justin Barish

Justin Barish is assistant vice president of digital marketing and network development at Dynasty Financial Partners in New York.