Should You Build a Marketing Funnel?

When I ask financial advisors what their primary marketing goal is, one of the most common responses I get is “We want to build a marketing funnel.”

If you aren’t familiar with the term, a marketing funnel is a concept mostly used by online consumer product companies. A funnel lays out the steps to lead someone from a total lack of awareness about a product to the purchase of that product.

From a financial advisor’s perspective, a marketing funnel is a theoretical path that the prospective client takes from not knowing who you are, to gaining awareness, to researching you, to evaluating you, to finally becoming a client. 

In consumer products, a funnel looks something like this: You, the consumer, see an ad for the company’s candle on Facebook. You click the link, which takes you to a landing page selling that candle. Suddenly, a pop-up appears, offering you 15% off your first purchase if you give the company your email address. You do and then exit the website because you aren’t ready to buy.

Now, three times a week, you get an email from this company promoting different candles. A month goes by and you click the link to a landing page and buy a candle from them. This is the funnel: Facebook ad > landing page > pop-up form > promotional emails > landing page > purchase. 

The idea behind funnels is that people don’t make a purchase the first time they are introduced to a business. So, the company needs to nurture them before they can close the sale. 

Let’s examine a funnel example for a financial advisor’s business. You speak at an event. You encourage audience members to visit your website and provide their email addresses in exchange for a copy of the slides. Once they fill out the form, they get a series of automated emails recapping the presentation’s key points and encouraging them to schedule an appointment. Then they schedule the appointment and become a client. 

Sounds great, right? The problem is that marketing rarely works like this when you offer a high-priced, high-commitment service. Prospects don’t follow a neat funnel like marketers would have you believe. It’s common to nurture relationships for years and have dozens of touch points from all different channels.

It’s not until the prospect has a painful and urgent financial matter they need you to solve that they hire you. The purchasing process is not linear. It looks more like an interconnected network of marketing activities … an ecosystem.

A more realistic scenario is that the prospect sees you speak at an event, and they download your slides, ignore your drip emails completely, and receive your monthly newsletter (which they also ignore). But they see your name month after month.

Two years in, they are on a social media group you also belong to, and they see your comment answering a financial question that’s also been on their mind. The next time they get your newsletter, they decide to open it just to see what you are up to. They notice you are hosting a webinar on a topic that has been concerning them lately. They attend the webinar. They get a new set of drip emails that they also ignore. But they decide to connect with you on their favorite social media site and see your updates weekly while still getting your newsletter.

A year later, some sort of money-in-motion event common for their niche happens (laid off, spouse died, sold an appreciated asset, etc.). All of a sudden, they need financial help. And you are the first person who comes to mind. Finally, they schedule the appointment and become a client.

It takes time and effort to gain the trust of your prospects to hand over their life savings to you. And because it’s a relationship that usually lasts their lifetime, it’s a huge commitment on their part to work with you. Expecting people to trust and hire you because they have been funneled into your marketing process is unrealistic. 

Hourly planning or commission-based services may have more success with a traditional marketing funnel because the perceived costs and commitment are low. But when you offer a service that may end up costing north of $200,000 over a client’s lifetime, funnels don’t work as they have been designed. You are not asking them to hand over $25 for a candle. You are asking them to trust you with their net worth.

Trust has to be built, and you do this through an ecosystem like the one described here.

Funnels do have value. Each campaign you implement should be designed using a funnel framework. It is a worthwhile tool to plan all the components of any individual campaign. It provides one hypothetical path for prospects to follow to become a client.

While they probably won’t follow the funnel, the structure helps shore up any holes in your process. But your overall marketing strategy should comprise a network of interconnecting and interacting parts. It should be an ecosystem.

Final Thoughts

Traditional marketing funnels are ineffective for the high-priced, high-commitment services that financial advisors provide. Instead, you want to focus on building your prospects’ trust over time. The way to do that is through a marketing ecosystem, a network with dozens of touch points in multiple channels. In this way, you nurture your prospects until they come to know and trust you and are ready to work with you.


About Kristen Luke

Kristen Luke is the President of Kaleido Creative Studio, a marketing consulting firm that positions Registered Investment Advisors and their employees as experts in a niche, making them uncomparable to other advisors. Over the past 16 years, Kristen has consulted with hundreds of financial advisory firms and shared her marketing expertise via industry conferences and publications nationwide. This article is an excerpt from her upcoming book, due out in 2023.