Advisors Market, But Don’t Measure Marketing

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The subject line of the email was eye-catching. “If you're not measuring marketing, you're not marketing.” And in the body of the email, the folks at the Harvard Business Review posed this question: “Can you explain the impact of your marketing to your board of directors?”

Naturally, that got me wondering whether financial advisors could answer that question, whether financial advisors measure their marketing. And what I found is this: Small firms are marketing, but not measuring the way Harvard might recommend. And, larger firms are marketing and measuring.

“It would certainly BE worthwhile to measure marketing however, in our type and size of business it is not very easy,” says Stephen Csenge, CFP, AIF, a partner with Csenge Advisory Group.

Unlike many larger companies where you can do traditional marketing, such as a direct mail or email campaign, and measure the responses, ours, says Csenge, is not so straight forward.

Csenge says he conducts several “marketing” efforts (client events, newsletter, website/Facebook, networking, and the like). But there’s typically a lag time between generating

 a lead and acquiring a client. It could be weeks, months or years in between meeting a prospect and converting that prospect to an actual client, he says.

“So, it is not a direct action/response system,” says Csenge.  “What we do, do is on an annual basis track our overall marketing costs vs. our new revenue (excluding market ups and downs).  As long as that is around 1:3 ($1 marketing expense to $3 new revenue) or better we are happy.”

Meanwhile, Roy Ames, a senior investment advisor with The Mutual Fund Store, reports that most of the marketing analysis is done at the corporate level. "They do track cost per lead, cost per client and ROI," says Ames . "I am not sure of other metrics, but I use a CRM to track each lead to either becoming a client, or added to a list for additional marketing in the future." 

As for Harvard, well, it’s hawking something called Measuring Marketing Performance, “an in-depth, interactive CD-ROM presentation that will show you how to create a marketing dashboard that will reveal the true performance of your company's marketing activities.”

According to the pitch letter, Professors John Quelch and Gail J. McGovern, both of the Harvard Business School faculty, explain and illustrate each step along the way toward keeping senior management informed of how your marketing strategies are attracting, cultivating, and retaining customers. In addition, Harvard says buyers of the system will learn the fundamental principles of marketing excellence; determine what to measure and learn how to interpret the results; align marketing activities with corporate strategy; and ensure that marketing is driving growth.

What’s more, the system, which costs only $69, has been used – at least according to the pitch letter – by such firms as mutual fund giant Vanguard.

Wonder if the system can do for advisers what it’s done for Vanguard.

We wonder too whether you measure your firm’s marketing efforts or not. Share your tales with your peers in the comment field below.