Advisors need to give their marketing plan a “facelift” and start embracing social media when it comes to high net-worth clients, says April Rudin, founder and president of The Rudin Group, who spoke at the CFA annual wealth management conference in Toronto.
Many ultra high net worth and high net-worth clients fall into the baby boomer segment, which will see $40 trillion dollars transferring hands into younger generations over the next several decades, says Rudin. If advisors want to retain these assets, they need to be changing their style, method and tone when it comes to marketing and prospecting.
“Wealth is being transferred to younger people earlier than it was to previous generations,” says Rudin. “Gen X and Gen Y will quickly be surpassing the wealth of baby boomers and if you aren’t connecting with the younger generations you could be missing out. Ninety-eight percent of new wealth inheritors change advisors.”
Rudin says advisors need to start thinking beyond their comfort zone and evolve their method of communication.
“Social media isn’t any different than when the telegraph or mobile phone came about,” she adds. “It is all about how you keep pace with innovation and how you plan for change.”
With younger ultra high net worth investors more inclined to use social media as a communication tool and read their advisors blogs, Rudin suggests eliminating outdated marketing tools such as brochures or mass mail mailings. Advisors should be looking to invest those dollars into cross-generational marketing campaigns that include digital initiatives such as blogging, LinkedIn or Twitter. Advisors should allocate 38% of their marketing budget to digital and social, up from only 19% five years ago, says Rudin.
“You can still have the same marketing budget, but have a different allocation of where you are spending those dollars,” says Rudin. ” It is about putting your more money and more effort into social and digital campaigns.”
Forty-seven percent of ultra high net worth clients, those with over $5 million of investable assets, are using Facebook; while 56% of high net worth clients are doing the same.
“One of the biggest misconceptions that people have is that wealthy people aren’t on the Internet,” says Rudin, “Everyone thinks these clients want to fly under the radar and stay completely private but that is not the case”