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#FA Success Ep 327: Growing To $1B By Standing Out With Marketing The Competition Can’t Mimic, With Marc Horner

April 4, 2023 07:07 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome to the 327th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Marc Horner. Marc is the Founder of Fairhaven Wealth Management, an independent RIA based in Wheaton, Illinois, that oversees more than $1 billion in assets under management for 450 client households.

What's unique about Marc, though, is the way he's been able to market and differentiate his firm by drawing upon his years of wirehouse experience to create a distinctly un-wirehouse brand… going so far as to create a series of parody commercials that portray stereotypical 'big-firm' sales-oriented advisors who may not have their clients' best interests at heart as a way to distinguish and contrast not only his firm's fiduciary approach but their 'willing-to-be-different' culture to prospective clients.

In this episode, we talk in-depth about how Marc developed and implemented his unique marketing strategy of writing parody commercials that feature a satirical sales-centric advisory firm, Bear Brothers Financial, and how he got mentally comfortable taking such a non-traditional approach to trying to stand out in his marketing, how Marc has sought to grow his team through a split of one-third organic hiring, one-third of recruiting existing advisors with clients, and one-third of hires made through acquisitions, and how, while Marc was in the early stages of planning to leave the wirehouse world and go independent, he made cold calls to other advisory firm owners asking for advice on making the transition… which also grew relationships with them, to the point that 4 out of the 5 firms he has now acquired were a result of those initial cold calls.

We also talk about how, after 14 years in the wirehouse world, Marc decided to break away and go independent by himself, and managed to grow quickly from $80 million in AUM to over $1 billion and 22 employees in under 8 years, how Marc created what he calls a Protective Put to find new opportunities to acquire other advisory firms, where Marc signs an agreement that if something were to happen to the advisor, Fairhaven would take over the advisor's clients and give their families an agreed percentage of revenue over a period of time so the monetary value isn't lost, and how, in addition to his website and parody commercials, Marc self-publishes a bi-annual print magazine (that features financial topics with lots of photos and employs local college students to write the copy) so that he can stay in front of prospects (and even other advisory firms he might someday acquire) in a more tangible way.

And be certain to listen to the end, where Marc shares how he balances the mentality of taking the work they do for clients very seriously but 'not taking ourselves so seriously' in the way he markets, why Marc feels that aspiring advisors would benefit from beginning their careers not by pursuing financial advisor jobs but getting into the commercial banking industry right of college, where there's less pressure to prospect and sell and more opportunity to learn the mechanics of finance and get familiar with the needs and challenges of small business owners looking to borrow from a bank's commercial lending team, and how Marc was able to balance the rapid growth of his firm over the past 8 years with still being present for his family (including driving 5 hours to be present for his oldest daughter's college volleyball games) by setting his family as a hard priority on his calendar just like any other client or work commitment!

So, whether you're interested in learning about how Marc's unique marketing strategy is received by current and prospective clients, how Marc handles the rapid growth and scaling of his firm, or the way Marc structures his firm and compensates his advisors, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Marc Horner.

The Latest In Financial #AdvisorTech (April 2023)

April 3, 2023 07:02 am 0 Comments CATEGORY: Technology & Advisor FinTech

Welcome to the April 2023 issue of the Latest News in Financial #AdvisorTech – where we look at the big news, announcements, and underlying trends and developments that are emerging in the world of technology solutions for financial advisors!

This month's edition kicks off with the news that RIA custodial platform Altruist has built its own full self-clearing capabilities, while nearly simultaneously buying competing (not-self-clearing) custodian Shareholder Services Group (SSG) – which given the heavy costs of being in business as a self-clearing custodian, suggests that Altruist has reached a tipping point in terms of growth and scale (and intends to push that growth further, given its acquisition of SSG) as it seeks to grow its market share as an alternative to the "Big 3" (or part of the new "Big 4") custodians of Schwab/TDAmeritrade, Fidelity, and Pershing.

From there, the latest highlights also feature a number of other interesting advisor technology announcements, including:

BlackRock has closed the retail arm of its robo-advisor FutureAdvisor and shifted its clients to Ritholz Wealth Management, in another sign of how direct-to-consumer robo-advisors have struggled to gain traction given the high costs of client acquisition
Absolute Engagement has launched its Engagement Engine tool to provide opportunities for advisors to inject client input opportunities into advisor workflows and ensure that clients feel heard, understood, and engaged with on the issues that matter to them
Advice delivery and engagement platform Lumiant has raised $3.5 million in seed funding to support its growth as it builds out its "end-to-end" financial planning and advice engagement platform (but will it be able to replace, rather than augment, advisors' existing financial planning software?)

Read the analysis about these announcements in this month's column, and a discussion of more trends in advisor technology, including:

FP Alpha unbundles its Estate Planning Lab solution for automatically reading and summarizing clients' estate planning documents available as a stand-alone option, and rolls out a new P&C Insurance Snapshot tool, as demand for AI-driven document analysis grows but different advisors focus on different documents
Sora Finance has raised $3.9 million as it seeks to gain traction with its debt (re-)financing tool that allows advisors to take a more active role with their clients' "liabilities under management" via executing on refinancing opportunities along with shopping for new loans at the most favorable rates

And be certain to read to the end, where we have provided an update to our popular "Financial AdvisorTech Solutions Map" (and also added the changes to our AdvisorTech Directory) as well!

*And for #AdvisorTech companies who want to submit their tech announcements for consideration in future issues, please submit to [email protected]!

Weekend Reading For Financial Planners (April 1-2)

March 31, 2023 02:01 pm 0 Comments CATEGORY: Weekend Reading

Enjoy the current installment of "Weekend Reading For Financial Planners" - this week's edition kicks off with the news that, according to a recent survey, RIAs are considering metrics for growth other than assets under management, from the number of clients to diversifying the services they offer. And given that growth can create additional time burdens for advisors, many advisors are looking to automation as a way to gain efficiencies as they scale.

Also in industry news this week:

How RIAs appear to be increasingly pushing back against proposed rules and enforcement actions from the SEC
How one broker-dealer reminded its advisors that they do not necessarily have full independence when it comes to selling their firm

From there, we have several articles on spending:

Why now could be a good time to buy a house despite elevated mortgage rates
Why some of the most valuable 'luxury goods' money can buy do not have brand names
How advisors can help clients transition from savings mode during their working years to spending down their portfolio in retirement

We also have a number of articles on management:

7 books that can help new managers lead effective teams
How to create an employee onboarding process that can improve retention
How advisory firm leaders can take advantage of the trend of 'boomerang employees'

We wrap up with 3 final articles, all about personal growth:

Why taking a massive leap in personal growth can be rewarding, despite the risks
Why self-compassion is more effective than self-criticism when it comes to overcoming mistakes
A step-by-step process for finding and developing your passion without having to spend 10,000 hours working on it

Enjoy the 'light' reading!

Discovery Meeting Framework: 6 Questions To Help Prospects Who Are Resistant To Change

March 29, 2023 07:02 am 0 Comments CATEGORY: Financial Psychology

Financial advisors often approach discovery meetings with prospects as an opportunity to ‘sell’ the value of the financial planning services they provide. This is often done by having the advisor learn about the prospect’s needs and show the prospect how the advisor can help them achieve their financial goals, ideally motivating the prospect to sign up for the advisor’s services. But for some prospects, the value they will get from an advisor is not just in the dollars and cents of planning, but also in making changes to their behavior. Which means that advisors can help prospects get on the path to change (often starting with actually signing up for the advisor’s services!) by using financial psychology and behavior change principles with effective discovery meeting questions.

The Transtheoretical Model (TTM) of change offers a framework that can help financial advisors motivate clients who might be resistant to or struggling with change. TTM involves a 6-step process, where each step is designed to help individuals progress through change. Notably, the TTM process intersects with the financial planning process and the common challenges that arise in financial planning meetings can often be aligned with and explained by the different stages of TTM. For instance, new prospects might still be in the pre-contemplation stage of TTM, when they aren’t clearly aware of the problems they should solve, or they may be in the contemplation stage of TTM, when they are aware of a problem but aren’t yet ready to take action on it. In these cases, deciding whether there is value in engaging with an advisor at all and whether they will be able to follow through on what the advisor will ask them to do are often the key challenges for prospects that the advisor can address in the discovery meeting.

With this in mind, crafting the right questions to help prospects absolve themselves of the doubts they may have about an advisor’s value and their own ability to take on the responsibility of following their financial plan can serve both the prospect and the advisor well – because building up a prospect’s confidence in the advisor’s value and in their own capability to follow their plan (with their advisor’s support, of course!) will increase their own chance of success as well as the likelihood that they will sign on as a client.

Accordingly, there are 3 questions advisors can ask to address doubt by understanding what makes their prospects feel dissatisfied. These include asking about the prospect’s (dis)satisfaction with their net worth, with their financial decision making and self-confidence, as well as with their financial relationships. Together, these questions can help the advisor discover specific challenges that the prospect faces and start a conversation about how working with the advisor could help address these issues.

There are also 3 questions that explore the forces leading prospects to delay and procrastinate. These include exploring how prospects value action, talking about next steps, and asking the prospect to get started working with the advisor. These questions and the resulting discussion can help spur prospects to take action by officially becoming a client.

Ultimately, the key point is that while asking these 6 questions all together might not necessarily result in more prospect discovery meetings or better conversion rates, advisors might find that new clients are more likely to comply with their plans and take action on their tasks when this approach is used from the start of the relationship. Because at the end of the day, the more advisors are able to support the process of behavior change in their client relationships, the easier and more impactful their client work will become!

#FA Success Ep 326: Finding Marketing Success By Building Spreadsheets To Track That Advisor Data, With Erica Pauly

March 28, 2023 07:05 am 0 Comments CATEGORY: Financial Advisor Success Podcast

Welcome back to the 326th episode of the Financial Advisor Success Podcast!

My guest on today's podcast is Erica Pauly. Erica is the Founder and Owner of Track That Advisor, a consulting and coaching firm based in Gilbert, Arizona, that helps advisory firms track, and then improve upon, their marketing results.

What's unique about Erica, though, is how she built a series of spreadsheet tools to measure the details of each step of her advisory firm’s marketing funnel, from lead generation to each meeting in the sales process to client onboarding and getting initial revenue for the firm… and then turned it into a series of tools that any advisory firm can use to evaluate how their marketing is performing, where it needs to improve, and how they compare to the average advisory firm as a benchmark.

In this episode, we talk in-depth about how, through a series of Google Sheets, Erica helps advisory firms begin to track each of the steps in their marketing funnel, analyze how successful those steps are in turning a lead into client, and develop strategies to help improve those metrics, why Erica focuses on 5 key marketing metrics of stick rate, close rate, average client size, pending days, and cost per client, to quickly gain an overall picture of an advisory firm or individual advisor’s marketing process (and compare those numbers to her benchmarking data to identify where improvements should be made first), and why Erica ultimately built an additional tool on top of her spreadsheets that she calls the ‘Tracker Genie’ that helps advisory firms quickly spot gaps in their data and fix them (because in the end, it’s not just about tracking marketing data, but helping advisory firms to actually do what it takes to input and maintain their data in the first place!).

We also talk about how, while working in a marketing role at an advisory practice, Erica began to track data on their individual advisors’ marketing efforts because she realized that she didn’t have the data to support her suggestions for the firm’s strategic planning and decided to start measuring how the firm was performing at each step along the way so that she could prove that her recommendations were based on actual evidence, how, after moving to another state because of a job opportunity for her husband, Erica was contacted by the firm that she tracked data for asking her to continue her work for them, helping her realize there is a demand for her specific type of work and gave her inspiration to found Track That Advisor, and why Erica still deliberately chooses to use Google Sheets to track data (instead of a standalone software application), as it allows her to customize layouts for individual advisory firms and make it easier for support staff to navigate (instead of asking them to learn a whole new software platform).

And be certain to listen to the end, where Erica shares how, as a self-proclaimed introvert and people pleaser, she has learned to become more comfortable with having difficult conversations with advisors about their strategies and how they are performing, why Erica hasn’t taken the role of CEO in her own firm and has instead given that role to one of her trusted employees (because she recognizes that her strengths lie in analyzing data and coaching others, but she still needed someone in the role that has the drive and ability to help the firm continue to grow), and how Erica learned the hard way the importance of not only finding employees that are the right fit, but having detailed processes and workflows so that as the firm grows, she can ensure that she is maintaining firm culture and business execution and ensure that the firm can continue to grow into her long-term vision and beyond.

So, whether you’re interested in learning about how Erica and her team track advisor data and keep advisory firms accountable, how using Google Sheets allows Erica more flexibility in creating customizable data sheets for the advisory firms she helps, or how Erica has evolved Track That Advisor and her plans for the future of the business, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Erica Pauly.

How Marketing With The CFP Marks Reduces Client Acquisition Costs And Accelerates Revenue Growth

March 27, 2023 07:05 am 0 Comments CATEGORY: Marketing

When consumers shop around before buying a good or service, many factors can play a role in their final decision, from previous experiences to the recommendations of friends and even to the companies’ branding. And when it comes to how a consumer perceives a brand, there are three critical components that come into play: brand awareness (simply knowing that the brand exists), recognition (recognizing a brand for its unique components and features), and brand equity (the value associated with a specific brand). These factors, especially brand recognition and equity, are often used to help fill in knowledge gaps when contemplating the purchase of a product or service, especially when the consumer isn’t clear about the actual value of what they’re considering.

In the context of financial advisors, surveys have shown that CFP certification serves as an important branding signal for consumers seeking the services of a qualified advisor. For instance, a 2015 study found that consumers had higher brand awareness of the CFP marks, even more than the well-known ChFC, CFA, CLU, and PFS designations. In addition to having better brand awareness, research has also suggested that the CFP marks tend to have better brand recognition, and that consumers were just as likely to associate the CFP marks and CPA designation with professionals who offered financial advice, with an increasing inclination toward using a CFP professional for financial planning.

Further, the benefits of how the CFP marks are perceived as a valuable brand appear to have a meaningful impact not only on how advisors spend their time, but also on their revenue growth as well. According to the 2022 Kitces Research study, “How Financial Planners Actually Market Their Services”, advisors without the CFP marks typically spend more of their time on marketing activities relative to CFP practitioners (allowing them to spend more time on higher-value tasks). Similarly, CFP practitioners were found to have a lower practice-wide Client Acquisition Cost (CAC) and greater revenue growth in 2021!

Accordingly, promoting the brand of the CFP marks to the public can be a good way for advisors to boost their own personal brands in the minds of consumers, and at the same time serve to promote recognition of CFP certification more broadly as a sign of high-quality financial advice (and supporting CFP Board’s own publicity efforts). Some strategies to do so can include simply talking about their own experiences as CFP professionals more intentionally (e.g., in meetings with both prospects and centers of influence, such as accountants and lawyers, who might provide referrals), and promoting the marks in their social media posts and other marketing strategies (e.g., SEO tactics, drip marketing campaigns, and online advertisements).

Ultimately, the key point is that CFP certification not only provides advisors with the technical knowledge they need to provide high-quality service to their clients, but also is a valuable signal that can influence a consumer’s decision on who to look to for financial advice. And by promoting the marks to the public, advisors can further build brand recognition and equity for the marks, elevating all CFP professionals in the process!