Investopedia Advisor Insights: Why Most Financial Advisors Should Skip It

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#OfficeHours with @MichaelKitces Video Transcript

Welcome, everyone. Welcome to Office Hours with Michael Kitces. We're here today to talk about sites like NerdWallet, and in particular now Investopedia, which launched an interesting new platform last week called Advisor Insights.

What is Investopedia?

So just a little context in case most of you aren't familiar, I suspect many of you already are, just from your normal daily use of the Internet. This thing called Investopedia. As the name implies, it's an investment and finance encyclopedia. They're frankly a massive site. I believe there's something like 20 million unique visitors that show up every month to Investopedia.

I'm sure most of you have experienced this, right? You type pretty much any financial-related word, and up comes Investopedia. If you just type something like “alpha” or “beta” into Google, Investopedia is going to be one of the top two or three hits. They were founded back in the late '90s. They got sold to Forbes in 2007. And their business model, as with so many content sites, is pretty straightforward. Ultimately they're an advertising site. They take 20 million unique visitors that come through, all of which, almost by definition, have something to do with investment related stuff. And Investopedia sells ads. And even if you take a fairly moderate ad rate, when you multiply it by 20 million people that show up on the site every month, you've got a pretty decent looking business... which is why Forbes ultimately bought them!

So they've been in the content business for a long time. I know a number of advisers that actually write for Investopedia and produce articles for Investopedia. But from Investopedia's perspective, if you're a content machine like that, that just gets paid on advertising, the business model's actually really simple. Get as much content as possible, put it on the web, let people type in searches, have them show up on your site, and serve them ads. Investopedia is basically just a content machine, as are so many advertising driven content sites.

Investopedia Launches Advisor Insights

So Investopedia launched this new service last week that they're calling Advisor Insights. The idea of Advisor Insights is, "Hey, we've got all of this general investment knowledge information on our site, encyclopedia style articles. But some people have slightly more specific questions or questions that the article doesn't specifically cover. Let's give them advisors to answer their quetsions."

And so Investopedia launched this platform called Advisor Insights, where, as advisors, you can sign up on the platform, consumers ask questions, and you can type your answers. It's all public, your responses are out there and available.

Investopedia will actually have moderators to curate the questions, just to make sure they're like reasonable finance related questions, and that people aren't divulging personal information. which sadly, amazingly, people actually do. I've seen a couple of other sites where people say, "Hey, I got a problem with my account. The account number is blah, blah, blah, blah, blah, what should I do?" And they're typing their actual investment account information in a random website! So Investopedia will moderate all that, curate it down to real questions. And then advisors get to answer the questions. And there's even a little voting system, so readers can upvote if it was a good answer, or downvote if it was a bad answer. It kind of gamifies the process, so advisors will get scored and tracked.

In fact, if you go and look at the Advisor Insights page, one of the first things that you see [on the right] is who are the top advisers, which means their answers have gotten the most upvotes and not downvotes. And then the advisors also get a profile page where you can see the advisor, their basic contact information, phone number, email address, a link to their website, a picture of them, a little bio, and then all the questions that they've answered, and their answer ratings.

So Investopedia started out with about 75 advisors [in a beta phase]. They're now saying they're hoping to really ramp up. Investopedia wants to get 1000 advisors up on this service. You don't have to pay anything to be on it. Consumers don't pay to ask questions. The whole thing is free. And they're even going out of their way to try to vet the advisors to make sure they're good quality advisors, so evaluating things like whether you have your CFP certification, you've got to have at least 10 years of experience, etc.. I don't know if they are unequivocal requirements, maybe if you don't perfectly fit that you can still apply. But they're going through a formal vetting process to make sure that they're going to have people that actually are advisors who answer questions with substantive answers, and that you're not just there to schlock your products or pimp out your own marketing and not actually contribute meaningfully to the site.

Should Advisors Sign Up For Investopedia Advisor Insights?

So I started getting questions about this almost as soon as the announcement hit. Investopedia basically said, "Hey, here's a great opportunity for advisors to build out their digital marketing presence by answering questions on our site. So is this a good deal, is this something that advisors should do?"

So I'm going to make this really simple for all of you: No.

No, Investopedia Advisor Insights not a good deal for [most] advisors.

It's really not.

With the utmost due respect to Advisor Insights, it's not a good deal for advisors. And here's why... ultimately why do we do this? Even when we throw out benefits like, "You'll get exposure," why do we do it? We're doing it because we're hoping to get clients, right? That's why we go down this road of marketing and exposure.

But I'm going to ask you a pretty simple question here. Honestly, how realistic is it that a consumer who types their questions into Google, finds Investopedia as an answer, chooses to ask a follow-up question, and gets the most brilliant two paragraph answer from you to a fairly generic question where you have no ability to ask follow-ups... what does that really do to help you at the end of the day? I'm not sure. I'm not sure how much that really helps you.

What Kind of Business Does Investopedia Realistically Drive To You?

Austin is making some Periscope comments here. He's participated in a similar service on NerdWallet and I guess has gotten a couple of follow up, at least inquiries off of that. And I'm curious, have any of them done business with you? I guess that's even a general question to all of you. How many you, any of you, on here have actually gotten paying clients off of this?

Now strictly speaking, I'm going to guess that at least a few of you've gotten a single client at some point. If you do enough marketing things, you'll get some client from almost anything in sheer volume. But here's the challenge to it, particularly for most of us that do comprehensive financial planning... this is not how people find comprehensive financial planners. Right? [Even Investopedia's own CEO acknowledges that advisors aren't likely to get leads from the Advisor Insights platform!]

Why Exposure Alone Doesn't Pay

Imagine it from this perspective: You're a contractor, you do contracting. Someone comes along and says, "I got a great deal for you. You come and build my building for free, but since my building is right next to a major highway, millions of people who drive by the building will see that you're doing the contracting work on this building and you'll get tons of exposure from the fact that this building is being built in a really visible place. So you should do the contracting work for free."

What really ends up happening at the end of the day of that deal? You do a bunch of work for free, they get a building, and nobody who's driving by on the highway, seriously calls you and says, "You know, your contracting work on that building looks so awesome. Please build my dream home for me." That's just not really the dynamic!

And even from some of the comments that are coming through [on Periscope], for those of you who've gotten leads for this, you're noting that they tended to be hourly leads. Which makes sense to me, right? People ask specific questions because they're looking for specific answers. Now, if you have some hyper-focused in-depth area of expertise, I get this. If you're the country's leading Social Security expert and you want to answer a couple of Social Security questions on this thing to keep driving visibility back to the fact that you're a leading Social Security expert, I get that. And maybe you'll get some clients that want to pay you hourly advice now because they found you initially there, and you're the country's leading Social Security expert.

Of course, the caveat in front of all that is: first, be the country's leading Social Security expert. Step two, answer questions on Investopedia. In other words, the problem is that you need some kind of demonstrated and established niche expertise to engage people in the first place. And even then, frankly, you need a business model to match it. If you do hourly advice and you like answering one-off questions in exchange for a fee, maybe some of the flow you'll get from a site like Investopedia, and it will "work". For hourly clients.

But if you're trying to do this simply because you want "exposure" and you're hoping someone who sees you on Investopedia is going to give you their life savings, I just don't see it. I don't think it's realistic at all, in any remote way, shape, or form. By definition, you're answering questions for free from people who would rather type their questions into Google or a free site rather than pay someone, and what do we ultimately get off of that? What do you really think is going to happen when you answer questions for free from a do-it-yourselfer who'd rather type their questions into Google rather than finding experts? They're probably going to keep typing questions for free into Google, rather than finding experts.

Be Careful With How You Spend Your Valuable Time

So Austin, sounds like you've answered a couple questions at NerdWallet, and had one qualified client who came through who actually engaged you for hourly work. So again, I get it for the hourly end, if you've got some expertise. Austin, I know you specialize in with Gen Y and focus there, so I get it on that end. But be cautious for most of you. And of course, the irony is Austin is noting this is helpful for him because he's a solo startup. So as he puts it, and I mean this in a kind way, Austin, but when you're getting started, you've got more time and fewer clients. So throwing some time into wide based opportunities may be appealing, because you got the time available and you can do lots of different marketing efforts.

Of course, the irony here is that Investopedia is really trying to focus on more experienced advisors, where you actually already have more clients, and maybe not as much spare time, and you have to focus your marketing efforts. And would I focus my marketing efforts in an area where I build someone else's house in exchange for exposure? I don't know about that.

Does Digital Exposure Improve Google Searches For My Site?

Elliot asked the question, "Well, what about just doing this for exposure, because your pages come up higher on Google?" Well, yes and no, Elliott. The problem to this, particularly for advisors that don't necessarily have a whole lot of experience and exposure online already, is you know what's going to happen? The number one page that's going to come up on Google now is not your site, it's Investopedia's site. That's how they get from 20 million users to 21 million people online?! Because advisors who answer questions for them start driving traffic to Investopedia, instead of driving traffic to their financial advisor website. It drives more traffic to Investopedia.

I almost laughed at the announcement. Investopedia claims this almost as a bragging right: "Hey, great news. If you answer questions on our site, then when people type your name into Google because they're looking for you and they want to work with you, they'll see your bio on Investopedia... and come to Investopedia where we can serve up ads to them!" And they frame that as though that's a benefit to you!?

Advisor Insights Is "Free" So How Will They Make Money? Ads To Your Prospects!

Now to be fair, if you look at the Advisor Insights pages so far, there actually is no advertising. But that's kind of a "Yet," right? There's no advertising... yet.

It's funny, there's a question out there on Quora, which actually is another open Q&A site, that Investopedia has even compared themselves to with this service. If you actually type, "How does Investopedia make money," into Google, you get a Quora answer. It's actually from the guy who cofounded Investopedia, and the entire article response to "How does Investopedia make money?" has one word. It's a one word article, and guess what the word is, it's "advertising".

So we're taking a business that makes 100% of their money off advertising and says, "Hey, advisors, we'll give you the opportunity to answer questions for free online so that you can drive more traffic to our site." Anybody want to guess how long it is until Investopedia does what Investopedia does? I don't know, maybe it'll be 1 month, 3 months, 6 months, 12 months. I don't know how long they're going to nurture this thing. I'm sure they'll be tracking the traffic. But you can kind of see what's coming.

They're going to serve up advertising. So at what point have you spent days, weeks, months, or years, answering questions on their site, so that when consumers come to the website, they see your answer, your bio in tiny letters, and then a big, giant flashing ad from Fidelity, or Merrill Edge, or one of the other companies that currently buys tons of advertising on Investopedia? And where do you stand at that point? They've got the content. You’ve signed away the rights, you've produced something of value on their site, and then what ultimately happens in the end? They sell advertising.

Either that, or the flipside is, they'll actually realize that advisors are getting lots of clicks and lots of activity, and then ultimately what happens? What will happen to you is the same thing that happened to brands that built on Facebook. Brands went out there early on. They built these giant Facebook pages. They got tons and tons of likes. They built all this traffic and community. And then Facebook came back and said, "You know what? We've realized this is working so well, that now we're going to charge you to keep reaching the people you've already been reaching."

And that's really what I think it's going to come down to. They're ultimately going to do one of two things. They're going to serve up advertising, or at some point, if the platform actually works, they're going to charge you. They're either going to charge you to be on the platform, maybe they'll add a button that says, "Contact this advisor if you're interested." And they click the contact button, and then you'll get an email that says, "We'd be happy to hand this lead off to you. It'll just cost you $75."

I mean, they have to make money somehow. I have no grudge at all against Investopedia for making money. But just recognize the machine that they operate. They produce content to bring people in so that they can get paid. And ultimately, they're going to get paid by either getting paid to send you the lead, or getting paid to put advertising that sends the lead to someone else -- Fidelity, Merrill Edge, whoever it is. And all you end up doing, your role in this machine as the advisor that produces content, you're the contractor building their building. You're the one that's actually giving away your valuable expertise to build the economic value of their site and business, which they control in the long run, because they're going to have the content.

If you decide to move on and do other things, they've still got your content to continue doing their thing.

So I see Periscope questions coming in, like, "Why doesn't Investopedia syndicate blogs over or take content over from your site?" They don't want it! You know why they don't want it? Because they want to make sure they rank number one. And if they take content from your site, then ultimately, they're not going to get Google organic search off of your site, because Google is very smart, it realizes that if the article is on your site first and Investopedia second, that yours originated it. They don't want content that's not going to drive traffic, that's not going to drive new, organic traffic, because that's what they sell the advertising to.

So maybe they'll change the Advisor Insights plan. I'm happy to be shocked and wrong. But I suspect anybody who tries to say, "Hey, Investopedia, can I just send you articles that I already wrote on my website and originated on my site first," they're going to say no.

Build Your Business And Convert Your Own Traffic

And the next challenge that goes with the Investopedia Advisor Insights platform, which Austin is bringing up in a Periscope question, is "how are you converting this traffic?"

So for those of you who aren't familiar in the digital marketing world, convert means: "okay, they came to your site, but how do you get them to do a next step to engage with you?" If someone comes to your site, you control that environment, "Hey, thanks for coming to my site. Here is an awesome giveaway I have that would be extremely valuable for you in exchange for your email address. You give me your email address, then I'm going to send you regular information that's really, really helpful."

Now I'm building a relationship with you. I'm building a connection with you. Someday maybe you'll do business with me because I'm going to drip market you. I can create an entire marketing funnel that starts with you come to my website, I give you something valuable, I get your email address in exchange. We start a marketing connection. You can't do that on other sites because it's not your site, it's their site. And they're not letting you get email sign-ups for your list on Investopedia Advisor Insights, or NerdWallet, or these other similar platforms.

Be Sure Your Work Drives Traffic To Your Site

Again, you're not building your value, you're building their value. You're building their business in exchange for what frankly, I find this ephemeral, you'll get "digital marketing exposure" so that something gets found.

Elliot's even pointing out, "They've been after me to change my bio to be something different than my website." Right. You know why? Because they want to make sure that their version of the bio is different than your version of the bio, so that when someone types your name into Google, the consumer finds their site so that they can get a page view to sell an ad rather than, heaven forbid, your site actually coming up first when they type in your site!

They're systematically executing the model to make sure that any content you give them outranks your own stuff so that they're number one. Now again, from the business end for Investopedia, this is a very good way to execute the model. I mean, they're doing all the things right. For them. There's a reason why they're a big valuable business. But you don't have to play this game. It's your choice about whether you're going to give away your valuable time, content, and expertise, to their site. That's your choice. And be really careful about what you're giving away, what you're doing with your time.

Again, kind of getting back to Austin's comment, if you're really a startup and you've got more time than marketing ideas to execute, and you want to experiment with this as a little bit of an extra marketing channel, I guess knock yourself out early on. I wouldn't go whole hog into it, but if you want to experiment, and maybe you'll get a one-off hourly client lead, which if you have no clients is someone to pay you, that's better than no one paying you. I get it on that end.

But ultimately, if you're going to be in the content creation business, I realize, for a lot of you, you don't even want to do that, but if you're going to go down that road, if the thought of actually going to a site, and taking consumer questions, and typing up thorough answers excites you, awesome. Do that on your site. Put it on your site. Make a "Frequently Asked Questions" page from your clients. Make a blog. Once a week, take a client question that comes in, answer it on your blog, create your own value. Start building your own building. Don't build theirs. It really is that simple.

You're actually seeing the glimpse of what Investopedia is doing. Investopedia has realized that you can build an entire business off of nothing more than "take questions people ask, type in answer, put it on a web page, let Google find it." But you can do that, too! It's not unique to them! Now I'll grant, they have a little bit of head start because they're frickin' huge. But clients find them for generic stuff. They're the encyclopedia. No client is going to work with you because they Google, "What's the difference between alpha and beta," and your site comes up in its answer, and they go, "Oh my God, this guy's got the most brilliant explanation of the difference between alpha and beta. I think I want to give him my life savings." That's not how it's going to work anyways.

How To Create Valuable Q&A Content On Your Own Financial Advisor Website

In other words, let Investopedia have the financial encyclopedia space. You don't want it. You don't need it. That's for information seekers who, more power to them to get great information from Investopedia. But if you build value for you, what questions are your clients asking? Answer those questions, and that's how you build and execute. So, Austin, you asked, "Have you found info on how to build this on a website?" Yeah, make a blog, a list of articles on your website, that showcases your expertise!

So how do you build this on your website? Make a section, call it "Blog," call it "Frequently Asked Questions," call it "Our Insights," call it whatever the heck you want. Once a week, take one question that a client has asked you that you think other people who are similar might have the same question. Write the question, answer it, put it on your site, and let people actually find their way to you. Let people who found your site already, read through, see your expertise, understand your skillset. Make it into an automated mailing list, so that now anybody who signs up for your website gets your once a week answer every time you post it. You could automate that entirely. And now you're drip marketing by doing nothing more than answering one client question a week.

That's all it takes to start building your business. And it's much more effective than handing away work. Elliot's saying, "Maybe Investopedia can get is a tax deduction for pro bono work." Very funny, but it's not pro bono work. It's not pro bono. They're making money off of it. They're a for profit entity making money off it! You're just giving them free money! That's the dynamic! That's ultimately what's being built here.

Now again, if you've got lots of extra time, I understand. If you're already a recognized expert in something and you want to occasionally dabble content on one of these sites, I actually get it. For those of you who have built a platform already, there's a whole interesting discussion about how do you build exposure for an already existing hub, and doing things like working with other sites, "Guest Posting" is the label in the blog space, actually can be a really effective means. But it only works when you build your foundation first. And your foundation is your website, demonstrating your expertise, with your content, and a way to convert people who visit your site so that they actually have a connection to you. The easiest way, "Follow me on social media. Give me your email address," something so that they can keep a connection to you in the future.

You have to build your foundation first. If you give away everything to Investopedia and you have no foundation, you're not going to turn anything into business for you. You're just going to build business for them. So be careful with that. And I'm picking on Investopedia a little because they're in the news cycle since they just did this, but there are a lot of sites out there that do this now. And they're all doing it because they've all realized that it works (for them) because advisors are so desperate for getting digital exposure without realizing that that doesn't actually mean anything, that we're willing to give away hours of our time, and content, and expertise to build other people's businesses in a manner that doesn't do anything material for our own.

So take your expertise, put it up there for you on your site, and let people find their way to your expertise. And when you've got a thriving, active site, and we want to come back and have another Office Hours about how do you turn your thriving, active site into something even bigger by doing cross posting, guest posting, working on expert services and all that, we can have that conversation. But we publish a top advisor blogs list. I know what most of you are doing out there in the blogging space. You're not at the point where you should be building Investopedia's business. You're at the point that you've got to build yours first.

Start With You - And Don't Put A Gap Between You And Your Client

So I hope that's helpful. Let me answer some more questions.

So, Mike, I don't know if you're trying to troll me here with this comment, "So just to clarify, build your Investopedia profile first." No. Build your profile first! Build your website first! Start with you. When you're already number one on Google and you're willing to let Investopedia be number seven on the bottom of the first page, awesome.

If you're not number one on Google, then I'll tell you exactly what's going to happen when you go to Investopedia. You're going to take whatever shot you had at being number one in Google on your own site any time soon, and you're going to push it down to number two and three. And you're going to get to the point where when a consumer refers you, one of your clients refers you and says, "Hey, you should check out my advisor," they'll go online, they'll Google for you. But they won't find your website, they won't find your business, they won't find what you do. They'll find Investopedia. With an ad next to it, that happens to have your name also. And we'll see what happens. Maybe they'll click from there through to your website?

But don't be fooled. Even if you start seeing traffic come through from what's Investopedia's bio page, it's probably not because consumers were dazzled by the brilliance of your answer that they're coming through in droves. It's probably because they were searching for you at first, found the Investopedia page by mistake, and then passed through to get to you where they were trying to get in the first place!

So don't put the extra impediment in the way. Don't give Investopedia chances to serve up ads and do things that makes money off of your prospect. Let your prospects find you, build your foundation first.

So I hope that helps as some food for thought. Thanks for hanging out with me today. Office Hours, Michael Kitces, every Tuesday, 1:00 p.m. East Coast time. Hope all is well for you. Thanks for the tap tap Periscope love, and those of you who shared it out on Twitter. Awesome. Greatly appreciate it. Have a great day. Take care, everyone!

So what do you think? Do you participate on "Ask An Advisor" Q&A sites? Have you gotten any real business from it, that you wouldn't have likely gotten anyway? Has it been a good ROI for your time and effort? Please share your thoughts in the comments below!

(Update: After this article was originally posted, Investopedia Advisor Insights provided some further details regarding its program in the form of an FAQ which can be found here.)