Is there a mismatch between advisor marketing and consumer preferences?

There is a critical disconnect between how financial advisory firms market themselves and how consumers choose their advisors, according to a recent study by Ficomm Partners.

The Great Marketing Mismatch: 2024 Financial Advisor Growth Marketing Study surveyed 437 financial advisory firms and built on Ficomm’s July 2024 consumer research, which highlighted shifts in what most influences how investors choose advisors.

The findings underscore a stark misalignment, the survey said. While 45% of investors in the consumer study selected their advisors through digital marketing, only 29% of firms prioritize digital marketing as a client acquisition strategy. Conversely, 47% of firms rely primarily on referrals, despite only 29% of consumers requiring a referral when hiring an advisor.

“Referrals will always be an important channel for growth,” said Ficomm CEO and co-founder, Meg Carpenter, “but as the consumer’s buying practices change, financial advisory firms must adapt by integrating strategies that meet consumers where they are.”

“Advisory firms can continue to maximize their referrals from clients and COIs while also diversifying their lead sources to focus on their future ideal client,” added Carpenter. “The key is a documented marketing strategy that allocates tactics and resources appropriately for your growth goals.”

Consumers choosing via digital marketing

So why are an increasing number of consumers selecting their advisors through digital marketing rather than referrals? “Demographic shifts in the population are making referrals less valuable than ever,” said Carpenter. “The referral cliff is coming. “

Carpenter added that according to their research:

• Among clients age 60 and over, 60% still rely on referrals to hire an advisor, making it the last age group where this is the majority preference.
• For those nearing retirement within the next five years, advisors will encounter a new cohort where only 29% require a referral, while 45% hire advisors based on digital marketing.
• For consumers under the age of 44, the change is even more pronounced, Carpenter said. “Only 17% need a referral, and 57% select advisors through digital marketing,” she said.

“This shift reflects a growing preference for transparency and accessibility,” Carpenter added. “Younger generations prefer the convenience of researching advisors through online content, testimonials, reviews, and social media before making contact. Digital marketing meets these needs by allowing advisors to build trust and establish their expertise across multiple channels, aligning with how modern consumers make decisions.”

Increasing importance of digital marketing

And why is digital marketing becoming so important in gaining prospects? “Digital marketing is essential because it aligns with how consumers are now discovering and vetting advisors. The consumer today is online,” Carpenter said

Carpenter added that their research highlights the following:

• 64% of effective marketing tactics are digital, and prospects typically require at least two digital interactions—ideally five or more—before taking action.
• Digital platforms enable advisors to showcase their expertise, communicate their value proposition, and engage potential clients in meaningful ways, ultimately creating warmer leads with higher intent to convert.

Top-performing advisory firms are leveraging multi-channel strategies, including social media, videos, and educational content, to drive growth beyond traditional referrals.

Aligning with consumer preferences

Carpenter then shared some insights from the Ficomm roadmap for aligning with consumer preferences. This roadmap, she said, offers actionable steps for advisors to better meet consumer expectations and increase their organic growth. Among the actionable steps shared by Carpenter:

• Know Your Ideal Client Profile (ICP): Define not only demographics like assets and occupation, but also psychographics such as values, goals, and interests. ” Build a detailed ICP to attract more ideal clients,” she said.
• Document Your Strategy: Create a growth marketing plan focused on reaching your ICP. “This should include a differentiated value proposition and targeted messaging across chosen digital channels,” she said.
• Elevate Your Digital Presence: Develop an engaging website and maintain active profiles on platforms where prospects spend their time. “Use educational content, testimonials, and case studies to build trust,” she said.
• Diversify Lead Sources: Incorporate paid lead generation, content marketing, and partnerships to expand reach. “Success in these areas hinges on having a robust foundational strategy,” she pointed out.
• Empower Advisors as Growth Channels: Equip individual advisors with tools and training to share firm-aligned content on their personal networks, creating scalable, authentic connections with prospects.

The Ficomm study surveyed 437 financial advisory firms at the end of 2024, examining their marketing strategies and practices. Findings were contextualized with consumer data from Ficomm’s 2024 Consumer Insights Study: Digital Marketing in Wealth Management and Schwab’s 2024 RIA Benchmarking Study. Ficomm Partners is an embedded growth partner for RIAs and wealth management platforms.

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