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lead generation financial planning

My Logo Or Yours? Understanding Familiarity Bias & Lead Generation in Financial Planning

Use technology to fix the trust problem

Lead generation in financial planning and corresponding services is broken. Part of why it is broken is because lead generation services are trying to develop their own brand trust. Trust ME and MY service and algorithm to find the right advisor/product. Conversely, lead generation services may be able to do more by supporting trust that already exists. Use pre-existing trust in XYZ firm or service to attract interest in other products and services offered by XYZ firm. Why would this change matter or be important to consider? Leveraging brand awareness and affinity (i.e. familiarity bias) makes more sense psychologically.

Before getting into the logistics of how to build better lead generation services and products within financial planning and services, it’s important to differentiate and define terms that are often used interchangeably when they are different. Brand recognition, awareness, loyalty and affinity are all different terms with different meanings. They are interconnected and rely on one another. Yet, each defines a different level of connection between consumers and brands. Opinions very slightly on definition, but here are the basics of the relationship.

Brand Recognition & Relationships

There’s a process and psychological process to us connecting to brands. We may not always be aware of it or realize it happens, but it certainly happens. The more we understand how the better we can leverage this process into building the best lead generation solution out there.

Here are the 4 levels of brand recognition

Recognition: This is when a consumer simply recognizes the logo or brand name, but no association with it has been developed.

Awareness: This is when a consumer knows the firm’s logo or name and identify that logo, name, and brand with (hopefully) a best in class or unique solution.

Loyalty: This is when the consumer is loyal to the brand and they would continue to choose it even after prices changes, or over other companies enter the same marketplace.

Affinity: This is when a consumer has a personal relationship with the firm and through that relationship the consumer is more likely to continue with the brand even if similar services are offered elsewhere.

These market research terms are based on the psychological bias or preference for what is familiar to us. We tend to like what we know, feel we understand, and feel a relationship to more than things that are unfamiliar. Now toss in money. Harnessing brand recognition up through brand affinity in lead generation must consider not just how consumers spend money, but more importantly who consumers trust with it (or don’t). It is one thing to like Coca-Cola over Pepsi. It is another to commit to a bank, insurance company, broker dealer, or individual financial advisor. Lead generation services do not address this issue and in fact, create a new problem, a new financial service to have to “trust”.

Trusting Financial Things is Difficult

Consumers really do not like trusting or learning to trust financial things and people. Recent reports of consumer trust in different sectors of financial services provide a relatively bleak outlook, more trust has been eroded than gained. Nor is really the consumer to blame for widespread distrust. Bernie Madoff, 2008 housing crash, recent crypto-crashes…the financial news has given them lots of reasons to think the financial industry is full of crooks, criminals, and confusion. Consumers are going to question lead generation services for financial planning and services too. Consumers will display this questioning in two ways. One, the consumer will never try the lead generation service – being listed on the CFP website is a great example. CFP – Certified Financial Planners are a gold standard. Being on the website establishes credibility. But many consumers do not know Certified Financial Professional from College Football Playoff. No data is not good.

Bad Data is Almost as Bad as No Data

Bad data is the second issue. Consumers can and will provide lead generation services with bad data. They may lie about their net worth or needs. Consumers may be confused about their actual needs. And this bad data, just like no data if not worse, is a major problem for lead generation. It breaks the whole system down from the get-go. Connecting the wrong consumers to the wrong products, services, or professionals does not help the consumer. Nor does it help the institution with the product, service, or professional.

These bad data or no data failures of lead generation services in financial planning can be seen in financial planning marketing data. For instance, in the Kitces.com study on How Financial Planners Actually Market Their Services passive lead generation like being listed on a website (CFP, NAPFA, or Fee-Only Network) or paying for actual leads (SmartAsset’s SmartAdvisor, Custodial Referrals) is necessary for those that want to grow. Advisors only have so much time to have meetings or attend events – do active, time intensive marketing. As such, engaging in passive strategies are required so that leads can come in while the advisor is doing other things. However, this does not mean that it is working well. Satisfaction with paid referrals (solicitors, custodial referrals, online listings) are not very high – usually around five out of 10 or lower.

The highest, of note, are custodial referrals. Custodial referrals have the highest overall satisfaction rating, and the leads are quality leads. Custodial referrals rank lower on lead quantity as compared to solicitors. But that might be a good thing. For example, more mediocre leads could be a potential waste of time, when compared to fewer quality leads, for consumers as well as financial professionals.

So, Custodial Relationships?

This begs the question, why doesn’t everyone have a custodial relationship? Well, custodial referral relationships are hard to secure – there are rules around which firms or providers can participate. Essentially, the best of the best get to participate and no one else. This could be in an effort to protect consumers, only giving referrals to the best firms. Yet, it could also be a sign of poor infrastructure on the big institution side. Essentially, it is hard to know ALL of the financial professionals and ALL of the products that ANY given consumer would be looking for and then make a personalized recommendation across such large ecosystems. More custodial referrals could happen for more consumers and more financial professionals if the data and algorithms were in place to help these fantastic referrals happen more often.

And it is worth pointing out that this is not JUST a finding within financial planning firm marketing. A study of consumers and how wealthy consumers find financial professionals from Philip Palaveev – wealthier clients find additional financial services and products through current relationships with that brand! A client of Chase bank is more likely to work with J.P. Morgan Private Banking services and financial planners, as just one example. The consumers knows Chase bank and likes it and via growth from brand awareness to affinity the consumer trusts Chase that Chase says they should work with Chase’s private bankers and planners. Consumers like what they know, like what is familiar, and are more likely to build additional relationships with that brand over starting a relationship with a brand that is unfamiliar. Especially when the trust brand itself (not an outside resource) does it for them.

What Couplr is doing to fix Lead Generation

Couplr is aware of the nuances of these relationships and psychology. We’re also committed to building better lead generation services for the benefit of consumers and those serving them. Couplr believes in better leads through better relationships.

  • Go where the trust already exists – Couplr is a white label tool. Your institution’s brand has done the work and built the relationships. Use Couplr, branded to your institution, to help consumers who already trust you, seamlessly find more of your products.
  • Create custom connections – Couplr learns about your institution’s consumers AND advisors. Couplr’s algorithm learns about the people and products on both sides of the table. Institutions no longer need to figure out how to make these connections. Use Couplr to broaden the reach of these virtuous and powerful custodial referral connections.

Lead generation is broken in financial planning and financial services, but it won’t be this way for long. Couplr is currently helping large institutions understand their data and connect more consumers with financial products and planners on their platforms. Reach out to us with questions – we cannot wait to hear them!

Best Regards,

Meghaan Lurtz, Ph.D

Derek Notman, CFP