Kali Hawlk is the founder of Creative Advisor Marketing, an inbound marketing firm that helps financial advisers grow their businesses by creating compelling content to attract prospects and convert leads. She is a regulator contributor to the Journal’s Practice Management Blog.
There’s a battle raging in the corner of your business labeled “marketing.” It’s between two completely different methods for spreading the word about your firm and getting prospective clients in the door: outbound marketing versus inbound marketing.
Which strategy is going to win you the best results from your marketing efforts?
As someone who makes a living helping financial advisers leverage content as part of inbound marketing strategies, I’m admittedly biased. I believe that content should serve as the foundation for your marketing strategy. But that doesn’t mean outbound marketing doesn’t have a role to play. As biased as I am, I also know there are some situations where outbound tactics will win.
Let’s take a closer look at this debate and help you determine which method is appropriate for your firm.
First, the Difference Between Outbound and Inbound
You can’t make an informed decision about which strategy will win in your firm’s battle for the best marketing approach if you don’t truly understand each side of the fight and the differences between the two. Outbound marketing is traditional, old-school stuff; it’s where marketing and advertising started, and it’s what many businesses still rely on today.
- Cold calling (or cold emailing or messaging)
- Direct mail
- Paid advertisements (online or off) or paid publicity
- Trade shows/seminars
- Interrupting someone to get their attention
- Incurring a tangible, direct cost to acquiring a lead or client
- Creating an advertising system that’s dependent on a budget
Compare that to inbound marketing:
- Content creation (written, visual, or audio)
- Social media
- Public relations
- Supporting events
- Community involvement
- Public speaking
- Word of mouth
Inbound marketing earns someone’s attention; it gets their permission to communicate with leads and has low monetary cost of acquiring clients. Inbound marketing is more dependent on messaging and connection than ad spends, and does not always cost money to do.
Short on Budget? Advantage Goes to Inbound
The internet has made inbound marketing possible—and massively popular and often profitable—because the cost of distribution of the tactics in this marketing method is often free. Think back to the list of outbound tactics. With each one, there’s a cost associated and therefore a limit to how widely you can spread your message. There are only so many stamps you can buy to send out your direct mail because your budget is only so big, right?
But with inbound marketing, most of the time, you get free supplies and free distribution channels. It’s popular not because some millennial said, “Hey man, blogging is cool,” or “All the kids are on social media these days,” but because it’s an incredible opportunity for unlimited reach without spending a dime. It’s just a smart business decision to invest in inbound marketing, which of course, content marketing is a part of.
You get a lot more bang for your buck and you also have what essentially amounts to unlimited upside. Your reach is virtually limitless because you’re dealing with digital space. That being said, understand that both of these marketing methods could have a place in the overall marketing strategy for your firm if you want to be a successful marketer. There’s nothing wrong with either type—both work. The two methods are very different, but that doesn’t mean there’s a “right” and a “wrong” here. It depends on your business, your goals, strengths, and services.
Use Both Methods, but in the Right Order
Perhaps the outbound-versus-inbound debate is the wrong one to have. A far better question to ask is: in which order should I layer on my marketing tactics?
Start with inbound. Add on the direct mail or social media ads or whatever kind of cold outreach and paid advertising you want to do after you build a solid, organic ecosystem that houses a hyper-engaged audience of people who showed up to hear from you because they’d miss your message if it was gone.
Starting with content helps you build trust, relationships, and connections. Why does content deliver these results where outbound marketing may not? Because 50 percent of people under 40 don't trust financial advisers (according to Fidelity Investments’ Millennial Money Study); 65 percent of investors distrust the financial advice industry as a whole (according to an American Association of Individual Investors poll); and 66 percent of the children of clients will fire their parents' adviser when they inherit their assets (according to and InvestmentNews survery).
I’m sure you’ve heard some of these stats before, and they’re daunting numbers to face. To succeed in the modern world, you have to change the way you communicate. You have to find new ways to attract clients.
Traditionally, most financial planning firms get stuck asking for referrals as the primary way of building out a prospect pipeline. That’s really limiting; your ability to generate prospects lacks diversity this way.
And putting outbound or direct marketing tactics first tends to breed even more distrust than is arguably already there. Neither buying the attention of potential clients (through ads), nor interrupting and demanding attention (through cold calls or messages) builds authentic connections that allow prospects to feel like they know you, let alone like you.
If someone’s first impression of you is as someone trying to sell something (as an ad implies), is the power of your later communication going to be strong enough to convince them you’re there for the relationship and not just to make a sale?
Create a Space Where People Can Like and Trust You
Where content marketing makes a difference is that you earn your prospective client’s attention. You create, publish, distribute, and promote content to attract the right people with the right message and at the right time.
Content marketing creates a space where people want to come to you and work with your firm because they trust and like you.
If you sell a product or focus on transactions, you can likely succeed without high-quality content as part of your marketing strategy. You can get away with just scraping information from site visitors using cookies and ad pixels, then using retargeting ads to interrupt a separate web experience those people have at a later date.
I’m sure this has happened to you—where you’ve visited a site and that site’s ads follow you around the internet. Is it effective? Sure. I know it is, because I’ve bought more than one thing after seeing countless ads for it. But that was a thing, not a relationship.
If you focus on relationships rather than transactions, you should consider how you can develop a connection with those site visitors before you make your hard sell. Content allows you to establish yourself as a trusted partner, communicate why you versus the thousands of other financial advisers out there, and build a relationship before you ask for anything in return.
You don’t need to sell anyone if you create useful, helpful content. The right content can expand your reach, establish your authority, increase your influence, attract prospects and leads, and—most importantly—build trust between you and the people you want to serve.
If I had to declare a winner in the outbound versus inbound marketing debate, I might call it a draw—as long as inbound marketing gets your attention first, and you look to build on it with outbound tactics once you’ve established trust with the people you want to work with.
This column was originally published on the Journal’s Practice Management Blog. Read more at PracticeManagementBlog.OneFPA.org.