COVID-19 is wreaking havoc across the globe. In the business world, everyone from corporations to small businesses are scrambling to react to the market downturn and massive consumer decreases in the demand for their goods and services as families tighten their spending and hole up at home.
Unemployment in the U.S. has already reached an unprecedented level as companies try to slash costs and create cash flow by eliminating positions. Along with the workforce, marketing is one of the most likely areas to be targeted for cutbacks.
It’s true that pausing campaigns and pulling ads can be done quickly and easily, but could be a grave mistake. Here are three very simple, yet invaluable reasons you should not cut your advisor marketing in times of turmoil:
Reason 1: Your clients need you now more than ever
Marketing doesn’t just mean prospecting. In fact, communicating to clients should be the most important part of your marketing strategy no matter what the economic landscape looks like.
Research indicates that it can cost between five times and 25 times more to acquire a new customer than it costs to retain one. And a study by Bain & Company says that in financial services a 5 percent increase in customer retention can produce more than a 25 percent increase in profit.
With all the chaos and anxiety surrounding the current economic climate, you have the opportunity to be the voice of assurance for your clients. Reaching out more often and through various channels can help ease their worries and help remind them of the long-term strategies you created together. It can also deter them from looking at other advisors who might be prospecting in their direction.
Reason 2: You have an opportunity to stand out with prospects
The popular train of thought is that marketing is an easy cut during downturns, so there will be many other firms that do just that. The result? Less noise in the marketplace and less competition for your messaging. The smaller the pond grows, the easier it is to make a splash.
When advisors make the decision to cut marketing, they subconsciously tend to cut back on timely client communication, as well. This puts you in prime position to stand out with prospective clients looking for a new firm and show that, unlike their old/current advisor, you can be trusted to be there for them in good times and in bad.
In fact, this method of ratcheting up your marketing efforts has proven successful during other economic downturns. According to Forbes, businesses that either maintained or grew their ad spending increased sales and market share during the 2008 recession and afterwards.
Reason 3: Avoid killing your momentum
A general rule of thumb for marketing is that a consumer or client has to encounter your brand at least seven times before it sticks with them. The digital age has changed that a little bit, but, with the wealth management industry crowded with advisors, brand awareness is increasingly important in order to retain current clients and attract new ones.
Think about the commercials you see on TV: McDonald’s is a household name. Most Americans ages 50 and over can probably sing the Big Mac jingle on command. And, yet, they’re constantly advertising. Why? To make sure you’re always thinking of those golden arches.
Marketing is like a good ‘ol fashion train. It takes a little while to get moving, but, once it does, it’s hard to stop. If you kill that momentum, it can take a long time to get it moving again. And with the volatility of the markets, you’re likely already managing less assets. To make up for those losses, your marketing needs to step it up and help you acquire more prospects.
What is your marketing plan for this economic climate? How will you nurture existing client relationships and attract new prospects?
Schedule a call to see how Lexicon can help.