5 Marketing Metrics that Financial Advisers should consider

Marketing metricsMost financial advice businesses consider financial performance every month, quarter and year. It can however be worthwhile though to start paying attention to some of your marketing metrics if you’re looking to grow a profitable business. There are many marketing metrics you might consider in your advice business, but here are my top 5.

1. New and existing advice clients and advice fees

This is perhaps the most obvious of all the marketing metrics. It is seen by some as a financial performance metric rather than a marketing metric. It does however directly relate to what you do for clients – so it really is a marketing metric. Count of new and existing clients and advice fee reporting enables you to measure progress towards monthly, quarterly and yearly new business targets.

2. Marketing cost per client

Most advice businesses spend money on marketing activities. Marketing costs can add up over time and performance becomes ambiguous if you don’t measure this. Without measurement, you won’t know which channels are working best for you. Websites, advertising, sponsorship, referrals – they are all costs and should be considered. Measuring marketing cost per client requires you and your fellow advisers to ask every new client how they heard about your business. At the end of the month divide the cost of the marketing activity spend by the number of clients you received from that activity. This will give you the marketing cost per client. The lower the cost, the more effective that marketing activity has been for you. Referrals traditionally have the lowest marketing cost per client and events have the highest.

3. Client attrition

Client retention is a goal for most advice businesses. When a client leaves it’s important you know why – as not all client attrition should be considered bad.  Typically there are 4 reasons – Death, Divorce, Displacement (they move) and Dissatisfaction.  The first three reasons are out of your control, and while it’s disappointing to lose a client, there’s not much you can do about it. As technology improves with the ability to have ‘Skype’ conversations and ‘GoToMeetings’ – distance is no longer the barrier it once was if a client moves. The final one though – dissatisfaction – you just might be able to do something about. These issues might include poor service, fee concerns, or not meeting client expectations.

4. Client satisfaction

Client satisfaction in my experience is the measure most advisers are nervous about. It can be a simple reply paid mail survey or something online via a tool like ‘Survey Monkey’.  Loyalty often forms a part of satisfaction surveys: How likely is it you’ll refer to a family or friend to our business? The thought of asking a client how satisfied they are is a scary prospect for those who haven’t done it before. It’s not a logical thought and here’s why. If they are not happy, they will leave your business anyway – I’ve never heard of a client leaving an advice business because they were surveyed for their opinions. The real outcome is that you get areas to improve upon and a glowing report from satisfied clients (including statistics and testimonials) that you can share with prospects and in future marketing efforts.

5. Service delivery metrics

This last group of metrics seek to measure the day to day happenings of service delivery to clients. Are all calls and emails returned within 24 hours? Are all admin processes completed within agreed time frames? Are clients delivered what you have promised within the agreed time frame? These metrics might be harder to measure. If you have staff set service standards for all service delivery processes you measure and make them accountable for meeting them and reporting to you or a practice manager. As a result of understanding the challenges or issues around service delivery, you can help solve them.

So what will you measure?

If you want to improve client outcomes and marketing outcomes for your business, start thinking about what marketing metrics you might include into your monthly, quarterly and yearly reporting. In addition to understanding your business better, you’ll be able to learn and make informed marketing decisions over time and improve your own satisfaction with your marketing spend.

Like any reporting, if a marketing issue is important to the success of your business, then measure it.


photo credit: Math via photopin (license)

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