Advisor Survey Shows Best Ways to Business Growth

Advisors understand their competitive position in their own market, but many have a hard time translating this knowledge into crisp marketing that differentiates them. While business development is a big challenge for many firms, the old adage “failing to plan is planning to fail” is reality for wealth managers. Those who do focus on sales planning and execution are much more successful at growing their businesses than those who do not. Referral-based selling is still the #1 way to build an advisory business, while advisors all but ignore the use of social networking and media for marketing and selling – a field of rapid growth in other industries.

Many investment advisory and wealth management firms have struggled to increase assets in the recent difficult markets. In order to understand how advisors feel they are faring – and the keys, and obstacles, to success – we partnered with Advisor Perspectives to survey advisors on the state of their business-building efforts. After working directly with advisors to help them grow their businesses for over the last 15 years, we’ve identified seven factors crucial to consistent and ongoing growth. The 7 Steps to Business Building, as we call them, are:

  1. Defining your firm’s goals and what you consider success (written business plans)
  2. Marketing that differentiates the firm in a crowded wealth management market
  3. Defining and executing a new business development plan (and having the right people to do this)
  4. Having and implementing a centers-of-influence (COI) strategy
  5. Ensuring that client referrals are coming from every possible channel
  6. Effectively using public relations – becoming the obvious expert the press turns to for comments or explanations
  7. Communicating with individual clients as frequently as each requires (and in the proper medium)

Our survey consisted of questions focused on advisor firm “health” in these seven areas. Responses came from 354 advisors representing approximately 335 firms (several responses came from different offices of large wirehouses). The breakdown was as follows:

Firm-type Fee-only firm description
Fee-only advisory 39% Wealth management 37%
Independent rep 29% Investment advisory 30%
Other 14% Financial planning 19%
Wirehouse/brokerage 13% Other 14%
Bank brokerage/trust 6%


The responding firms have assets managed, number of clients and full-time personnel as follows:

Assets Managed
($ millions)
Clients Personnel
Median $ 60 154 5
Average $ 228                501                        56

Wirehouses and firms with AUM greater than $2.5 billion excluded

Using the seven factors or “steps” as a guide, how do advisors feel they are doing? Some of the highlights follow:

1. Defining success and goals

Over 71% of respondents have defined their firm’s mission and values in writing. When asked how well they knew their firm’s strengths, opportunities, weaknesses and threats (SWOT) for their marketplace, 73% said “excellently” or “very well” while 27% said “somewhat” or “not at all.”