Turn your online reviews into a source of new referrals

Here are some tips for advisors who want to find success with online testimonials.

By Brian Thorp

It’s no secret that most Americans have always-on access to the internet at their fingertips, whether at their desk or in the palm of their hand. So it shouldn’t be a surprise to hear online reviews have replaced personal recommendations and word-ofmouth referrals as the primary source of influence when consumers are preparing to hire professionals such as doctors, lawyers and accountants.

In fact, 83% of people in an NRC Health Market Insights Study said they trust online ratings and reviews more than personal recommendations, even when choosing a doctor.

Today, thanks to the new Securities and Exchange Commission marketing rule, consumers can make more informed and educated decisions when choosing a financial advisor by reading online reviews written by advisors’ clients and other people who know them well.

Beyond evaluating the facts about financial advisors, such as their education and credentials, online reviews build trust and satisfy consumers’ emotional needs. This increases consumer confidence in contacting and ultimately hiring an advisor. Even a single online review can significantly impact a consumer’s hiring decision.

But how can financial advisors get started and turn their online reviews into an evergreen source of digital referrals?

Financial advisors can use online reviews to grow their business

With the SEC marketing rule compliance deadline now in the rearview mirror, financial advisors have the regulatory green light to join other trust-based professions using online reviews and testimonial marketing to grow their business. Of course, advisors should first speak with their compliance counterparts to understand any prerequisites they need to complete before getting started. Compliance officers can also answer important questions about the financial advisor online review websites their advisors are permitted to use and any training that may be required on the firm’s updated policies and procedures for collecting and promoting testimonials.

Once any compliance hurdles are cleared, financial advisors can incorporate testimonial marketing in their day-to-day business plan. Since every advisor’s circumstances are unique, the best approach for one advisor to get started may be different from another’s.

Here are tips for six types of advisors with different levels of experience and backgrounds to attract their ideal clients with testimonial marketing.

1. Breakaway advisors

Financial advisors who depart a national firm to start their own registered investment advisory may have to leave certain clients behind. Advisors can ask these former clients to write a review about their experience working together.

From a regulatory perspective, these reviews are considered “endorsements” (by former clients or nonclients)) and not “testimonials” (from current clients). But other than regulatory semantics, these reviews are just as impactful for advisor marketing and useful to consumers evaluating advisors.

Consumers Evaluating Financial Advisors

FACTS EMOTION HIRING DECISION

• Education • Credentials • Years of Experience ONLINE REVIEWS • Referrals • Word of Mouth

2. New advisors

In lieu of client testimonials, advisors who are just getting started in the industry can quickly amass online endorsements from nonclients — influential community members, mentors, their clergy or nonprofit leaders, among others. Online reviews written by these individuals can offer insights into an advisor’s character, civic contributions, personality and trustworthiness.

3. Niche advisors

Beyond gathering reviews from current clients, many advisors specializing in a niche have developed domain expertise and cultivated relationships with influential individuals whose endorsements can prove impactful.

For example, an advisor specializing in education funding may know local high school guidance counselors who regularly sing their praises. Now this praise can be published on an advisor’s profile on a financial advisor review website, where prospective clients can gain added insights to inform their hiring decision.

And as a bonus in this example, the same guidance counselor can easily refer families to the advisor’s profile on the online review website too.

4. Advisors with certain credentials

Advisors who have earned particular credentials may have already gathered testimonials and endorsements that can be “unlocked” thanks to the new SEC marketing rule.

For example, advisors who earned their Certified Kingdom Advisor designation had to first submit three references as part of the application process, including: 1) a pastoral reference and 2) “two client references from non-family members who have known you for at least two years.”

A quick call or email to these references will likely result in permission to publish their remarks as online reviews. Or their previously submitted remarks can be easily repurposed by these references in the form of a new online review.

5. Advisors with loyal but private clients

Not all clients want to see their names publicly displayed next to an online review, but many would be happy to write a review under a condition of anonymity (or semi-anonymity — e.g., Jane S.).

The SEC permits anonymous testimonials and endorsements when accompanied by appropriate disclosures, allowing advisors to collect and promote these reviews compliantly. Although reviews on sites like Google can’t be published anonymously, advisors may opt for an online review website like Wealthtender, where anonymous reviews are permitted.

6. Dually registered advisors

While FINRA-registered representatives have technically been able to collect and promote testimonials before the SEC marketing rule pursuant to Rule 2210(d) (6), many were prohibited by their home offices from doing so, partly out of concern about the prior SEC prohibition, or otherwise constrained by dual SEC and Financial Industry Regulatory Authority oversight.

Fortunately, with the new SEC marketing rule in effect, dually registered advisors will find they can operate under the disclosure requirements of both rules. Essentially, beyond complying with the SEC-required disclosures, registered representatives simply need to include a couple of additional disclosures, indicating:

» The fact that the testimonial may not be representative of the experience of other customers.

» The fact that the testimonial is no guarantee of future performance or success.

» If the review discusses a technical aspect of investing, the reviewer must have the knowledge and experience to form a valid opinion.

Online reviews establish a human connection with prospects, demonstrating trustworthiness and increasing consumer confidence in contacting and hiring professionals in trust-based industries. Thanks to the SEC marketing rule, financial advisors have joined the ranks of accountants, doctors and lawyers, successfully growing their businesses with testimonial marketing.

Financial advisors embracing online reviews as part of their marketing game plan in 2023 will be positioned to lead the industry in attracting new clients throughout the historic transfer of wealth from baby boomers to millennials over the next decade. While getting started may require jumping through a few compliance hoops, the payoff could be considerable for those advisors who skate where this digital marketing puck is going.

Brian Thorp is the founder and CEO of Wealthtender. He may be contacted at brian. thorp@innfeedback.com.