You’ve heard us say it before, and you’ll hear us say it again: Digital advertising is an excellent way to boost awareness of your firm and generate leads. Platforms like Facebook and Linkedin, for example, make it easy to reach new audiences and target users that are likely to be interested in your services. Every advisor should utilize digital advertising, but it’s important to have realistic goals and expectations for an ad campaign. Many of us expect immediate, spectacular results right out the gate, and unfortunately in most cases, digital ads aren’t an overnight miracle.
Capturing leads via digital ads is similar to capturing leads through any other type of marketing strategy. It takes time, practice, patience and testing – oh yes, lots and lots of testing. Having unrealistic expectations of how your ads will perform will not only frustrate you, but it could discourage you from ever trying digital advertising again. Mark Schlipman of Schlipman Wealth Advisors says advisors have a particularly difficult time keeping the long game in mind when it comes to marketing, and it’s a great lesson to keep in mind for advertising, too. “When it comes to marketing, a lot of advisors wouldn’t make great farmers,” he said. “They plant their seeds, and then go back just a week later looking for growth. When they don’t see it, they plow it all under.”
Reviewing industry averages for digital advertising will help you form a realistic mindset about how well your digital ads should perform. While you might be tempted to compare your firm’s ad performance to that of Nike or Amazon, you must realize that asking a web user to consider you as their financial advisor is a lot different than asking a web user to take 25% off their next purchase. Wordstream did some great research on benchmark performance for ads on Facebook and Google and broke the data down by industry. Take a look at the averages they found for the finance and insurance industry (updated for 2019):
|Platform||Click-Through-Rate||Cost Per Click||Conversion Rate||Cost Per Action|
Here’s a quick overview on what the above terms mean:
- Google Search: These are the ads that run at the top of Google’s search results, sometimes referred to as “text ads.” These ads appear when a web user types keywords into Google’s search engine – “financial advisor near me,” for example.
- Google Display: Ads in the form of clickable images Google displays on a variety of websites.
- Click-through Rate (CTR): The percent of people who clicked on your ad out of the number of people who saw it.
- Cost Per Click (CPC): The total amount you spent on the campaign divided by the number of clicks it received.
- Conversion Rate (CVR): The number of people who performed the desired action (typically filling out a lead-gen form of some sort) divided by the number of people who clicked on your ad.
- Cost Per Action (CPA): The total amount you spent on the campaign divided by the number of people who performed the desired action.
What Can We Learn from Industry Averages?
For starters, the finance industry experiences more of a challenge than most of the other industries in terms of click-through-rates and cost per action. Again, this can partly be contributed to the fact that we have bigger “asks” than other industries. Users can be wary of giving away their personal information to a wealth management firm, especially if they’ve never even heard of the firm or advisor before. These industry averages serve as a good reminder not to set unrealistic expectations for your digital ad campaigns. Keep these metrics in mind when your campaign comes back to you with 10,000 impressions and 700 clicks. You can remind yourself that you’re actually a little better than average! It’s also helpful to take into account how many leads you currently get per month. If you are like the majority of advisors, your digital marketing efforts likely yield somewhere between one and ten leads per month. Advertising will help you bring in more leads, but if you’re doing it right, you shouldn’t expect exponential growth. Sure, you could go a route that brings in hundreds of leads per month but picking the good leads out of the pack would be like finding a needle in a haystack.
What Does This Mean for Advisors?
These averages serve as a great benchmark for advisors to gauge the success of their digital advertising strategies. If your ads are consistently falling short of these averages, your ads could probably use a bit of TLC. The challenge here is discovering which aspect of your campaign is turning people off. It could be the copy, images, landing page layout, offer or several other components. Try doing some research on what type of copy works best for each ad type, switch up your images, make your landing pages more user-friendly, or try adding an emotional component to your ads.
So much of advertising is trial and error, so if your results are below-average, it’s no reason to get down. Just adjust and move on. The absolute worst thing you can do is quit digital advertising altogether because you aren’t hitting the numbers you want. And one other thing to keep in mind: When it comes to leads from your advertising and other marketing efforts, quality always trumps quantity. How much would you pay for one new $1 million client? If you paid $1,000 to run a campaign on Facebook for one month that brings in eight leads, and one of those leads becomes a new $1 million client a year later, would you say that campaign was worth it, even if none of the other leads pan out? Again, it’s important to keep the long game in mind.
Remember: It’s About More Than the Metrics!
While we certainly try our best to achieve and out-perform the industry standards for digital advertising here at Carson, we also know that digital advertising is about more than just the numbers. Sure, the numbers are important to help us measure what types of ads and messaging perform the best, but we also understand that there’s not a metric that captures the amount of awareness, trust and positive recognition a brand is building from its ads. Even if someone isn’t clicking on one of your ads or filling out a form, they are still seeing your name on their screen. They’re becoming more and more familiar with your brand and its services, which makes them more likely to engage with your marketing efforts in the future – whether that’s liking your Facebook page, checking out your blog or simply not flagging your marketing email as “spam” (and let’s be honest – that’s a huge win!). When it comes to digital marketing, visibility should always be one of your top goals.
Remember: keep the long game in mind. Just because we have the power of measuring metrics like clicks and cost per action doesn’t mean this is the only way to measure the value of our digital advertising efforts. Use these metrics as guidelines to help you determine what does and doesn’t work for your online audience, and continue to improve your ads from there.