During the first several years of running his own financial advisory business, Jim Dew relied on what he describes as the "Oh, by the way" marketing strategy. This usually consisted of an occasional referral from a client or getting invited to talk at a seminar sponsored by a company or a community group. A couple of years ago, he tried putting together an organized marketing effort, but in the end, it was a big frustration. Dew says that finally he admitted to himself that he wasn't trained to do marketing.
"I was building my business, I think, the way most advisors do-in a haphazard fashion," says Dew, owner of Dew Wealth Management in Phoenix. "You get clients without thinking about what clients you get and how you go about getting them."
Looking to put some polish on the way he promoted his business, Dew hired a public relations and marketing specialist two months ago. He expects to pay between $20,000 and $30,000 this year for its services, and it already has brought him surprisingly good returns. A couple of months ago, he was quoted in the Arizona Business Journal in a story about charitable giving-the first time he ever had been quoted in any publication. He's adopted a focused marketing campaign for a continuing-education program he offers to CPAs, and he's brought in about $1 million in new assets.
"It's the best single thing I've ever done for my practice," says Dew, who hired Patty Briguglio of MMI Associates Inc. in Phoenix. "All the other stuff was much more time-consuming."
Michael Kresh of M.D. Kresh Financial Services Inc. in Hauppauge, N.Y., says it serves little purpose to run a quality business if nobody notices. This is particularly true when competition is as rife as it is in financial advising. "Credibility is very, very important for clients," he says, adding that visibility through media and marketing exposure are two key channels for winning their respect. "There are so many different advisors out there, how else can they distinguish one from the other?"
Kresh started laying a foundation of credibility in 1986, when he was one of a number of financial advisors polled and quoted by Newsday, a Long Island daily newspaper, in an article about how to take an early retirement. After that, without the help of a public relations or marketing specialist, Kresh was able to capitalize on the quote, using it as leverage to get the attention of other publications, radio stations and television programs. "I've discovered that if you're quoted once, it's much easier to be quoted twice. And if you're quoted twice, it's much easier to be quoted four times," he says.
Kresh is a regular commentator on CNBC and periodically is quoted in magazines such as Business Week, Fortune and Worth and in the Wall Street Journal. He also makes sure his clients know about it: His waiting room contains a book of all his press clippings, and a television constantly runs videos of his television appearances. "By the time a client walks into my office, they have an extremely high perception of my credibility," he says.
Scott Kays of Kays Financial Advisory Corp. in Atlanta says one woman was so impressed with the dÈcor in his office that she signed on as a client and remains one today. But the look and feel of his office is no accident. Shortly after he started his business in 1985, Kays decided to follow advice he heard from a speaker at a marketing seminar. "He said, 'When you decorate your office, don't hire an office decorator. Hire a home decorator,'" Kays says.
So for his conference room, instead of sterile lighting and a long wooden table, he put in lamps, a sofa and a loveseat. The waiting area is furnished in a similar fashion and is decorated with Kays' family photos. "When you come into our office, you think you're in a living room."
Redecorating the office wasn't a make-or-break decision on Kays' part. But he still feels it's important because of one thing he's learned about selling his business: Every bit counts. "It all ties together," Kays says. "I don't think there is a silver bullet to marketing ... There is a comprehensive program you have to institute that involves internal and external marketing. It's the whole package."
Shortly after he started his own fee-based business 19 years ago, Chris Cooper of Chris Cooper & Co. in Toledo, Ohio, says he had a no-frills marketing plan that mostly meant he gave talks at churches and community groups that invited him. Soon, however, he tried hosting personal-finance seminars. One of his early talks was titled, "The Psychological, Legal and Financial Aspects of Pre-retirement Planning." It was a perfect fit for Cooper, whose business was situated in a blue-collar area where the largest employers were downsizing. The seminars typically drew about 30 people, and it wasn't unusual for half to become clients. He'd run two three-hour seminars a week and advertise them on the radio at $3,000 a pop.
Cooper feels the fact that he recorded his own radio ads was crucial in attracting people. "At least people became aware that this was a 'nice guy' that people could talk to," he says. At a time when most financial advisors were centered on selling products, Cooper feels he was one of the few selling himself purely as an advice giver. "It helped that no one else was speaking about the other issues of retirement other than the financial part," he says.
In much the same way that downsizing made people hungry for retirement advice back then, the downturn in the stock market has made conditions ripe for financial advisors now, says Kathleen Parks, chief manager of Greenbrier Capital Management PLLC in Knoxville, Tenn. "The downturn has helped folks to recognize that the volatility is real and present and that looking through a magazine and choosing mutual funds is not managing money," she says.
Seminars continue to be one of the bread-and-butter components of Kays' marketing efforts, which also have included the publication of a personal finance book, "Achieving Your Financial Potential," and national television appearances.
Kays says his typical seminar will consist of about 15 to 20 people, which is what he typically gets from a mailing of 4,000 invitations. The invitations are sent to households with annual incomes of $75,000 or more and in zip codes within a 10-mile, and sometimes up to 15-mile, radius of the firm.
The seminars include a dinner, and are focused on what the firm has to offer. They are held 10 to 18 times a year, usually at a private club or restaurant. "These seminars are very direct. They're all about us and how we think we can help them," Kays says.
The seminars, on average, result in the firm picking up one or two clients. The number, he notes, is down from five years ago, when the typical seminar attracted about 50 people and led to the firm signing up three to five clients. The difference now, Kays says, is that so many more firms, both large and small, are holding similar events.
"It's not uncommon for someone to tell me at one of our events that this is the fifth seminar they've been to," Kays says. Yet, by the firm's measure of success-finding a client whose annual expenses will equal one half the cost of the seminar-the events continue to pay for off, he says.
The average seminar costs about $5,000, including advertising. The firm has a minimum account requirement of $250,000, which means Kays is shooting for at least two new clients, with minimum accounts, with each seminar.
There's another payoff from the seminars, he says: They stimulate referrals. Out of 270 total clients, he says, "maybe half of those have come in by referrals from people who probably came in from seminars to begin with."
In addition to the seminars, the firm holds an annual golf tournament and periodic education seminars. Clients also are invited to bring guests to each of the events, Kays says. "Hopefully, we've touched people in some fashion at least five times by the time they've walked into our office," he says.
Cooper also does corporate seminars, is a regular commentator on the news broadcast of his local ABC affiliate, and he does a weekly radio call-in show. He has appeared periodically on various national network news programs. Exposure, he says, breeds more exposure. He was once quoted in a Wall Street Journal article about financial scams that target the elderly. The next morning he was on the Today Show.
Parks adds that advisors also need to find their focus. In her case, she tends to work with women who are in some type of transition, or "an entrepreneurial type person who appreciates good advice."
"The niche, I think, really has to relate to your personality," she says. "I don't think you can set out to pick up a niche and have it be inherently different from your attitude."
Kays says the aspect of marketing that's probably most important right now is the internal marketing-keeping current clients happy, which involves communicating with them often, particularly when the market is going through rough times.
Sometimes, he says, the results of all the work can be surprising. Kays says he's still amazed at the reaction his office's home dÈcor can get. He recounts one recent incident in which a prospective client walked into his conference room for an initial visit. Starting out, the prospective client was acting "kind of stiff." But then, he seemed to get more comfortable. "Within an hour and a half, he was lying down on the loveseat," Kays says. "I just sat there and said to myself, 'Well, he's relaxed.'"