To increase their assets under management, registered investment advisors might want to spend less time pressing the flesh and more time pressing buttons.

Referrals are typically seen as the best way to grow an advisory practice, but a newly revealed data set reveals that technology is key to business development.

Graig Norden, president of San Francisco-based Freewheel Marketing, developed the data set after establishing a new scoring regime for how RIAs are implementing technology, finding that the fastest-growing firms are taking a more holistic approach to digital marketing.

“There’s now evidence to show that technology is really going to help improve RIA’s businesses,” Norden says. “Financial services is a relationship-oriented business. The report suggests that the way in which consumers buy financial advice has changed – we argue that the way in which advisors sell their services should change as well.”

Norden and his co-researcher, Annalisa Alden, Freewheel’s head of operations, isolated 35 different pieces of technology connected to financial firms’ marketing strategies, grouping them into nine categories and then weighting them based on projected impact to develop a “Freewheel Score” that reflects a firm’s level of technological adoption and sophistication.

The Freewheel scoring considers nine technological categories: marketing automation, blogging, programmatic ad buying, retargeting campaigns, lead-conversion tools, social media widgets and sharing, HubSpot marketing grades, enhanced website analytics and Google Analytics. Marketing automation and blogging are given the highest weight in the Freewheel scoring scheme (20 and 15 points, respectively) while Google Analytics, at 5 points, was given the lowest scoring.

Norden first applied his methodology to what he deems as the 106 “largest” RIAs, culled from Discovery Data’s list of “Best RIAs”. These firms are non-dually registered and manage at least $2 billion in AUM, more than 50 percent of which are from retail clients.

For comparison, Norden then applied Freewheel scores to “fast-growing” RIAs and large asset managers.

“Our thesis was that those using technology, who are actually strategically implementing technology in their marketing efforts, are going to be better prepared to grow AUM,” Norden says.

It turns out Norden and his co-authors were right. When Norden’s scoring methodology was applied to Financial Advisor’s 2016 list of 50 Fastest Growing RIAs and compared to the larger cohort of RIAs, the fastest growing firms had scores 28 percent higher than the greater universe of RIAs.

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