Younger Investors Pick Financial Advisors Based On Marketing, Not Referrals: Survey

A recent survey by Ficomm Partners reveals a significant shift in how younger investors choose financial advisors, moving away from traditional referrals towards digital marketing. This trend suggests a transformative change in advisor acquisition strategies in the coming years.

The survey, which included 1,107 consumers (52% women, 47% men), found that while 60% of respondents over 60 would only hire an advisor through a referral, this drops to 29% for those nearing retirement and just 17% for those under 44, according to Think Advisor. Conversely, 45% of near-retirees and 57% of under-44s reported hiring advisors based on digital marketing, compared to only 20% of older respondents.

Megan Carpenter, Ficomm’s CEO, notes that these younger cohorts’ habits are unlikely to change as they age, given their comfort with digital research and purchasing. This shift indicates that relying solely on referrals for organic growth may become increasingly ineffective.

Also Read: IPO-Ready Shein Enjoys More Traffic Than Fast-Fashion Rivals, Data Shows: Are Temu, Poshmark In The Dust?

The survey highlights that no single digital channel dominates; instead, a mix of digital tactics is crucial. 64% of effective marketing tactics were digital, with consumers requiring at least two digital interactions before responding, ideally five or more.

While referrals will remain an important lead source, they can no longer be the exclusive method. To stay competitive, advisors will need to implement integrated, multi-tactic digital marketing strategies.

The survey sample predominantly included individuals with annual incomes below $149,000 (82%), while 17% earned over $150,000 annually.

This research underscores the evolving landscape of financial advisor selection, emphasizing the growing importance of a strong digital presence and marketing strategy. As younger generations accumulate wealth and seek financial guidance, advisors who adapt to these changing preferences are likely to have a significant advantage in attracting and retaining clients.

Read Next:

• Amazon Prime Day Could Benefit Rivals: Analyst Says Chewy, eBay, Peloton Are ‘Key Companies To Keep An Eye On’

Image via Unsplash