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But it may not be — not yet anyway — say some experts in the field. And for time-pressed independent advisors looking for ways to streamline their marketing efforts, it may never do the trick.
Marketing consultants say advisors may be better off sending targeted, permission-based emails in the name of slow-drip brand building than working to establish a presence on Facebook.
“Email remains a significantly more effective way to acquire customers than social media — nearly 40 times that of Facebook and Twitter combined,” according to the consulting firm McKinsey.
More precisely, the consultancy says the return on investment for email marketing versus social-media marketing is $38 to $1.
Why? “Because 91% of all U.S. consumers still use email daily, and the rate at which emails prompt purchases is not only estimated to be at least three times that of social media, but the average order value is also 17% higher,” McKinsey says in a report.
McKinsey doesn’t claim the case for email is unassailable, however.
If, for instance, one’s email marketing consists of untargeted spam, it’s likely to produce meager — and over time, diminishing — returns, the consulting firm says.
And consumers are getting less email-centric over time. McKinsey flags “a 20% decline in email usage between 2008 and 2012 as a share of time spent on communications, with the medium surrendering ground to social networks, instant messaging, and mobile-messaging apps.”
In other words, social media and texting are advancing on email. But mobile and social apps are still miles away from catching – let alone overtaking – it.
So for McKinsey it’s “necessary for marketers to make increasingly sophisticated use of social networks and other channels to engage with consumers and convert interest to sales.”
But the consultancy is just as adamant to warn sellers not to be “too hasty in shifting budgets away from email.”
As head of Halo Software, a company that sells B2B and B2C email databases with a financial service bent, Kevin Kilberry agrees that email campaigns are most effective when conducted in concert with social media outreach.
“Email is the tip of the spear” for financial advisors looking to attract, develop and convert prospects. In this role, it can enjoy the immediacy of an email while functioning as “a feeder to other places” — like a relevant webpage, blog or online video.
Meanwhile makers of email-campaign technology like Constant Contact and Halo Software provide analytics for tracking engagement — including social media follow-through — among email recipients.
But Kilberry says if he were a financial advisor forced to choose between email alone or social media alone, he wouldn’t hesitate.
“I’d do email because I can reach a more targeted audience and build relationships over time,” he says.
Practice consultant Mike Sakraida couldn’t agree more.
“It’s a ton of work doing social media — blogging, tweeting, whatever,” says the head of the Financial Advisor Network, an FA-only LinkedIn group with more than 15,000 members. “What works for large companies can be difficult for individual advisors to find time for because few of them can come up with the content, and even fewer can incorporate it into their daily activity until it becomes a habit.”
So Sakraida thinks advisors at small firms and sole practitioners should concentrate on marketing basics such as emailings and a decent CRM system for grading and following up on leads.
But to make email work as a primary marketing tool, Sakraida says FAs need compelling content including “the right subject line” — and, perhaps above all, the proper attitude and expectations.
The point isn’t to open floodgates of new customers, “but to get a conversation, have a meeting, build awareness,” says Sakraida. “Tell them enough to get them interested.”