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The Ultimate Email Marketing Guide for Financial Advisors

Jeremi Karnell
Aug 21, 2017

What if an investment consistently provided a 70 to 1 return on investment, year in, year out? Wouldn't you jump on it? According to the Data & Marketing Association's (DMA) 2015 National Client Email Report, the ROI of email marketing is 70 to 1. What's more, email is almost 40 times more effective at acquiring new customers than both Facebook and Twitter combined, according to research from McKinsey & Company. If you're looking for an effective way to market your financial advisory business, consider email marketing.

Benefits of Email Marketing

Sending a newsletter to your clients and prospects via email is a tried-and-true way to demonstrate your expertise, build trust, and present yourself as knowledgeable financial professional. It also keeps your firm at the top of their minds, helping to position your business as the obvious choice in the market and demographic that you are targeting.

For example, if you're targeting high net worth individuals, thought leadership-type articles about preserving wealth, smart philanthropy, and estate planning will help to illustrate your capabilities in these areas. On the other hand, if you are targeting human resources directors, you'll want to tailor your newsletter to help solve their problems in setting up 401k plans and benefits programs for their employees.

When your newsletter routinely provides helpful and valuable information, your subscribers may even share it with friends and colleagues which could lead to new clients.

In addition to positioning, email marketing plays an important role in both nurturing prospects and maintaining relationships with existing customers. The DMA says that it takes 7 to 13 "touches" to deliver a qualified lead. From there, you still need to communicate with leads in order to get the sale. Hubspot suggests giving it another 5 to 6 touches. Assuming you have a steady stream of leads coming in, you'll need to interact with them a good five or more times. Your newsletter and/or autoresponder messages can be integral to the process.

Do it Yourself or Hire an Agency?

There are several approaches you could take, each with their advantages and disadvantages:

  • Do it yourself -- Depending on your preferences, abilities, and availability, email marketing can be a DIY job. It's not overly difficult, but expect to spend some time in the beginning to master the learning curve. The advantages of doing it yourself include full creative control and low costs. However, consistency is key. Your subscribers expect to receive their newsletters according to the duration you've previously established. If your workload is such that you rarely have time for side projects, email marketing could get postponed indefinitely. Inconsistency here could send the wrong message to your customers and prospects.
  • Hire a full or part-time marketing person -- Delegating the job to an existing staff member or new hire is another option to consider. The advantage of creative control is similar, though someone else will be taking your vision and finetuning it. However, costs are higher because of payroll, taxes, and benefits.
  • Hire an agency -- Hiring a marketing agency may sound pricey initially, but it will probably be less expensive than hiring a fulltime marketing person. Agencies offer comprehensive email marketing services and should be able to deliver timely, relevant newsletters on a regular basis. While the agency will take over the creative, you'll still have the final say before messages go out. Advantages of using an agency include: consistency, creativity, marketing expertise, and the fact that you don't have to do anything other than approve each project and pay their invoices. You can also expect detailed analytical reports each month, showing you each campaign's reach and performance. Disadvantages include the extra cost and, potentially, a lack of relevant industry knowledge -- especially in terms of what financial advisors can and cannot do when communicating via email to prospects and customers.

Legal Compliance

While every business that sends email must comply with the CAN-SPAM Act of 2003, financial advisors have a host of other legal issues to grapple with as far as email (and social media for that matter) goes. For example, Outbound Engine notes the following:

  • Be careful about giving advice -- As you know, advice should be given on a one-on-one basis, not en masse. Carefully review all content, especially content written by someone other than yourself, to be sure that it's not inadvertently advising readers.
  • Be careful about "adopting" the opinion of others -- If you link to an article written by someone else, that link could be construed as an endorsement. By linking to someone else's opinion or analysis, regulators may wonder if readers might come to the conclusion that you've adopted that opinion. Avoid this potentially messy situation by refraining from linking, and if you do, using extreme care as to what you are linking to. Ask yourself: Is it neutral? Is it a good resource for unbiased information?
  • Watch out for "calls to action" -- a common practice in marketing that's forbidden for financial advisors -- "Call to learn more" and "Sign up now" are ubiquitous calls to action used in marketing messages of all kinds. Only problem for financial advisors is they are considered solicitations and soliciting is not allowed.
  • Keep copies of all communications including email newsletters for at least six years -- As with most every other part of your financial services business, you need to hang on to copies of all of your client communications, and this includes your email campaigns and newsletters.
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What You Need to Get Started

Whether you handle email marketing in-house or use an agency, you'll need an email service provider and a list of subscribers to receive your messages and newsletters.

Choosing an Email Service Provider

Your marketing agency may recommend a specific service or have one that they use for all of their clients. While you won't be involved in the day-to-day management of your email campaigns, it's smart to be informed. For example, will you have access to the solution for proofreading or editing campaigns? What if you leave the agency; will you be able to export your list and campaign histories? Where will the agency acquire leads and subscribers? Are these appropriate ways to build your list?

If you're handling email marketing in-house, you'll want to compare the various email service providers to find the best fit for your needs. Some to consider include: MailChimp, Constant Contact, InfusionSoft, AWeber, Get Response, and Campaign Monitor.

Building a "List"

It doesn't do much good to develop an email marketing campaign or series of monthly newsletters if you only have one or two contacts. You need a list of qualified subscribers who actually want to hear from you. You probably already have a list -- your existing clients -- so that's a good start.

One of the most common ways to get subscribers is through an "opt-in" box on your website. While you could go with the simple "Sign up for our newsletter," you may want to consider creating a special report on a topic of interest to your target audience and offering that to entice people to enter their email addresses. This is known as a "lead magnet."

A word of caution: banish the thought of buying a list from your mind. For starters, you could find yourself running afoul of the CAN-SPAM Act and most email service providers won't accept them. The list could also be worthless, filled with junk addresses or of people who you'd never target your service toward. Even if the list were filled with your dream clients, they don't know you. If they suddenly start receiving emails from you, you'll come across as a spammer. Not only is this an image you probably want to avoid, spam reports will hurt your standing with your email service provider who may close your account or pursue legal action. These are just a few of many negative aspects associated with buying lists.

Segmenting Your List

As your list grows organically, you'll soon find that it's become quite diverse. It may be a mix of prospects, customers, high net worth individuals, CEOs, retirees, and other types of clients. While you may serve them all, your messaging differs from one persona to the next. That's where list segmentation comes in, and most email service providers support this feature.

For example, you could segment your list into retirees and high net worth individuals, sending completely different emails and newsletters to them. This ensures relevancy.

Types of Emails to Send

Once everything is in place, it's time to start sending emails. Below are a few examples of the different types of marketing emails commonly sent:

  • Newsletters -- Send these regularly at an interval that makes sense for your business. Let subscribers know they'll receive them weekly, monthly, quarterly, etc., and then make sure to deliver them on time, every time.
  • Autoresponders -- Autoresponders are a series of prewritten email messages that are sent out automatically at specific intervals. For example, after downloading a special report on philanthropy, you could set up an autoresponder to send a series of 5 or more follow-up messages with information about the different challenges individuals are likely to face or types of charitable trusts available -- again, taking care to stay compliant with all applicable regulations.
  • Oneoff updates -- Did you just get back from an annual conference or complete an important certification program? Did your firm just celebrate its 10th year in business? Share the news. It's okay to toot your own horn from time to time, and it reinforces your credibility.

Email marketing's high ROI and impressive conversion rates make it a compelling choice for businesses of all types and sizes, including financial advisory firms. Regulations affecting your industry require extra care but shouldn't stop you from harnessing the power of email marketing.

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"8 Reasons Why You Should Never Buy an Email List." 2017. Accessed August 9. 

 "20 Shocking Email Marketing Stats All Business Owners Should Know." 2017. Accessed August 9.

 "Advisors: Grow Your Email List by Using an Opt-In Box | Investopedia." 2017. Accessed August 9.

 "Email Marketing Statistics - Email Marketing Stats | Thedma.org." 2017. Accessed August 9.

"The Do's and Don'ts of Compliance for Financial Advisors - OutboundEngine." 2017. Accessed August 9.

"Why It Takes 7 to 13+ Touches To Deliver a Qualified Sales Lead (Part 6: Case Study) | Thedma.org." 2017. Accessed August 9.

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