Find Your Signal in the Digital Noise

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Hi, I'm Sterling Shea from Barron's, and thanks for tuning in to another episode of The Way Forward. Today we're going to be talking about one of my favorite subjects, which is growth. We define growth in an advisor's business in the most simple, organic terms: net of market performance, net of M&A activity, an advisor's ability to attract, win, and retain long-term client assets. We think growth itself is one of the most important barometers of the health of an advisor's business. And growth isn't just important for growth's sake. It's important because it affords the opportunity for strategic reinvestment in the advisor's business. All the elements that go into delivering an exceptional client experience, better people, specialists, technology to elevate the touchpoints and interaction that you have with clients is vitally important. But growth has to be intentional. The success is never accidental. You need to have a, a strategy, a process, and accountability, uh, to deliver exceptional growth. And the nature of growth has really changed in the digital client engagement predicament that we all find ourselves in these days. Our guest today can bring a unique lens to that question. David Armstrong is the president and founder of Monument Wealth Management, which is a fast-growing RIA based in the Washington, DC area.. He's a great guy, a former United States Marine Corps officer and a CFA. David, thanks so much for joining us.

Thanks for having me on, Sterling. This is an honor.

Dave, let's hop right into things. You were an early adopter of digital marketing, and I know it's been such a critically important part of your business. You've spoken about it at events before, but now that we're all in this environment where digital client engagement has become so important, I'm wondering if you can share some ways that you're thinking about digital marketing and the medium of digital interaction with clients has evolved and changed over the years.

I remember back the very first time I ever created a Facebook account, just thinking it was really interesting, and I don't even think that the term social media had even been coined yet. And I identified it as, wow, what a fantastic way to communicate with people who are dispersed geographically. And it started out with just like everybody with a Facebook account, you know, high school friends, college friends, my Marine Corps buddies. And then it really became obvious to me that it could be incorporated as a business tool as well. And just with some on-the-job training, just kind of figuring it out, I really started to embrace the idea of communicating over social media. But, you know, that was almost— that was about 10, 12 years ago. And the landscape of social media and digital marketing has changed so much that people are much more comfortable with it. It's been so widely adopted, and I think it's really become a really serious mainstream tool for communicating your value proposition and your opinions out to, to not only your clients in an efficient and effective manner, but anybody else that could be interested in, in hiring you. And, you know, I look out over the industry and without, without any offense to anybody, I mean, there's a lot of what I'll call the sea of sameness out there. If you just go to some websites and things like that, I just think people are saying the same thing over and over again, thinking it differentiates themselves, and it doesn't. I think what it is that I find that differentiates one practice from another, and not necessarily making one practice better or worse, it just makes them different, is their unique voice and their opinion. And I find that people tend to look at the value proposition and say, geez, Monument's value proposition is really their unfiltered, straightforward opinion. So having embraced that, I look at the digital medium as a really great way to disseminate that opinion in an unfiltered, straightforward manner in— across different mediums that everybody seems to be using in some fashion or another. Now, some of those channels are more effective with different groups of people than others, and each one has its own unique structure to it and audience. But it's so scalable that if you make one post, you can put it across all the social media channels. It's very effective.

Well, I'm glad you used the word opinion because I think that's a really important idea and lesson in this. We hear all the time that advisors are talking to the clients and clients are saying they get lots of information, they get lots of analysis, but they're hungry for opinion and conviction. And I think the point you're making is that social media can no longer be optional for an advisor's growth strategy.

Well, it can certainly be optional. I just don't think people are going to grow without it. People can certainly opt out of it. Yeah. And plenty actually do, um, you know, and that's okay. I, I'm not here to say that one thing is better than the other, but, you know, my experience, um, has been that, um, using the medium as an effective tool for communicating my opinion, um, has been very, very helpful. We have a saying at Monument that we say all, all the time, which is, look, we're not a firm that's trying to resonate with everybody. We're just trying to resonate with somebody. So if I meet 10 people and 9 people don't like me but one does, that's a success for me. So, so I look at our social media channels and our digital marketing effort as a way to say, hey, we're going to own our culture, we're going to own our own personality, and we are going to own our opinion. And the people who like it and gravitate towards it and think, hey, I really like their conviction, their conviction, and I don't think it's grounded in stupidity— doesn't mean it's always right, but it's certainly never grounded in stupidity— people really love that. It makes us very relatable, and we can communicate that over the digital medium.

Well, I think that's vitally important. One thing that I would think or say characterizes your approach to this topic is it's extremely intentional, and I think that's the key. It has a process, it has a strategy, the success isn't accidental. One thing I want to ask you about is, of course, since the onset of COVID we've seen a radical change in the way advisors are operating under the work-from-home situation. Do you think things are different now?

Oh, they're definitely different. We're very lucky. We have— one of the unique things about Monument is that of the 11 people that work there, 70% of them are women, and they're young women, and we never had a maternity policy before. So in conjunction with creating our maternity policy, we also had one of our star up-and-coming next-gen leaders who's married to an Army officer. He got transferred and she moved, and we had to create a work-from-home policy for her, not only because she moved to Texas, but because she was also going on maternity leave. And, uh, that, that really forced us to figure this out in advance of COVID Once COVID hit, we were able to adjust to it very quickly, but we found that it wasn't so much the work-from-home policy. Um, that's a, that's a cultural issue, um, which I'd be happy to talk about some other time. But, you know, as far as it relates to the digital strategy, what we realized was that COVID not only affected our firm and us all working from home, it affected everybody. So now everybody's working from home. And what happens when everybody's working from home? They end up being online shoppers for everything. And that includes online shopping for opinion and information in the middle of a, you know, I'll call it a financial crisis, uh, certainly a, a very rapid and violent downturn. They are seeking opinion and information to determine whether or not they are doing the right thing, and if they're not, what do they need to do to change? And the digital medium made it very easy for people to online shop for opinion, and we were out there with it.

Does that mean your current digital strategy has to change, or is it evergreen enough to keep on track?

I think it could have been evergreen enough to stay on track, but we chose to, to pivot our digital strategy in the middle of I'll say like the end of March, beginning of April, because what we, what we discovered, and this was, we stumbled into this, but within the first 6 weeks of working from home, we had onboarded about $16.5 million of new, new clients that came to us post-starting work from home. And they all came to us because they had stumbled across in some way, shape, or form, whether it was a referral or just seeing a post that we had, about our conviction. We were writing a lot of content daily. We were writing content, and the people had been stumbling upon it. I'm sorry, I have the Sound of Freedom with the United States Marine Corps flying their F-35 over my house right now. That's background noise. And they had stumbled across our content and our opinion, and they literally reached out to us. As a matter of fact, we had one client reach out to us through a web form saying, I read this, I love your conviction, I love your philosophy on how to be handling this right now. I am in XYZ situation, either with an advisor or do-it-yourselfer, and, and I'm interested in becoming a client. And we had $16.5 million of that sort of a story come in. And I just— we all looked at this and we were like, if we're bringing in clients while we're sitting in our homes because of our digital efforts, we need to be all ahead, full speed, you know, moving in this direction towards adopting a more robust digital strategy. So we did pivot to that.

Well, a critical aspect of this is that it's almost impossible for an advisor to do alone. It takes a village, and making sure that your team is structured in the right way to handle all these tasks is vital. Can you talk a little bit about how you've done that and what investments you've made to set up yourself and the team for success in digital marketing?

Sure. There's two big components to our to our success and our pivot with this. One is that we take a very— we took a very non-traditional approach towards building out our team at Monument. Um, rather than have your hierarchical relationship managers and then operations people, we built more of a sideways firm, and we actually have 3 people who work in marketing. Now, they're, they're client-facing from the standpoint of they interact with clients, but their sole responsibility is outbound marketing for my firm. And focusing on everything from, you know, brand consistency, messaging consistency, colors, things like that, graphic design and the social media. So we invested in people who could concentrate on this full time. And actually our latest addition to the team is a woman who lives out in Denver, and I've actually never met her face to face, and she has completely ramped up our social game above and beyond what we are already doing just because she's so focused on it. So I made a huge— I wouldn't say it's a huge investment. It was a, it was a relatively big investment into people who would focus on it. So rather than have it be an afterthought, it was their primary responsibility. That was the one thing. And I'll encourage everybody to take a look at that, especially now in the environment where people can work from home. Your ability to source people that can do this is a lot more robust. The second thing we did was we decided to make it very serious. 6-figure investment into a contract with a digital marketing agency. And that has really helped us figure out the technical aspects of effective digital marketing, which I didn't possess, and neither did anybody that was really on the team. And that takes a lot of specialized skill, and that's basically skills that people are getting out of either being in-house with a big firm or being associated with an agency and then joining another agency and doing this for a living. That has been huge for us because there's so much of the technical aspects that we didn't realize we were either not doing or doing incorrectly. And that's really helped us as well.

How did you find the firm that you're using?

We did a couple of things. We started to ask around, but what I quickly discovered was— and not that there's anything wrong with this, this is just, you know, Dave Armstrong's weird personality. I started to ask my advisor friends, hey, are you using an agency? And we got the name of a couple of agencies. And we started looking at them, and then I just, I thought, maybe I don't want to have a digital marketing agency that does have financial services experience. Maybe they've adopted too myopic of a perspective on digital marketing for financial services, and that's part of this blah, blah, blah, sea of sameness problem. So I quickly put those aside after my first round of thinking about it, and then I just started going out and looking at what other big firms were using, and I started Googling things like Who does Peloton use for a digital marketing agency? Things like that. And not that I could afford anything like that, but it gave me an idea of what the flavor of what those agencies look like. And just through some Google due diligence and my, my black belt in Google-fu, I was able to identify some of these firms that I thought culturally were a good fit. And then the first thing I did was I went out and I looked at their social media presence. What are they doing? Tell— what is their— what does their voice look like? What, what are they doing for their clients? And we, we narrowed it down to about 4, and we went through an RFP. An RFP process, and we finally selected a firm with a culture that exactly matches ours called Axle8 out of Phoenix, Arizona. Could be any— Scottsdale, actually. Couldn't be any happier with Kim and her crew out there. They've done such a great job working with us. But, but they're— they were just such a great cultural fit for us. Like, it's sort of like I feel like I could go to work there every single day and not miss a beat, or they could come and work at us, our firm, every single day and not miss a beat. So that's how we found them.

Well, you're investing money into this, uh, and, and people. One of the things that I think a lot of advisors struggle with is setting expectations and goals around new business, particularly as it relates to not just digital marketing but marketing in general, because it's hard to tell if it's working as it should be. You often don't feel that connection, and referrals can be ephemeral. They can come from anywhere, and someone might see your social media, then ask a friend, then come to the firm. And when you ask them how they found you, it was from the friend. They don't even mention the social media. So talk about how you set expectations and goals around this to track performance?

Well, this is, this is a combination of the easiest question in the world to answer and the hardest question in the world to answer, right? So the easiest way to measure it is true or false. You're getting clients, money's coming in the door, right? I mean, there's your ultimate— there is your ultimate metric. Okay. The problem is what happened before that money came in the door that really influenced that person to say yes. To hiring you. And that's where the question gets harder to answer because you don't really know, was it, hey, was it this specific tweet that caught their attention? Was it this blog that caught their attention? Was it this funnel of content marketing that we were lead nurturing through? And that gets a little bit harder to measure. Um, so what you really have to do is, and this is really, I think, sort of a foreign concept to a lot of financial advisors because we're so used to dealing in the art of financial advice, um, that we don't have good solid experiences with the data side of, um, advice. And what's nice about the digital medium is that most things are very measurable. The question is, are you measuring the right things? And one of the things that I've learned as I've gone through this RFP process with the hiring agency was at first I thought Okay, website view. I'm just gonna make something up. How many people are coming to my website every single day? Okay, you would think that that's a very important metric. I'm not so convinced of that anymore, Sterling. Like, I don't— if I have 100 people come to my website but nobody's engaging with the content or, or interested in becoming a lead and getting more and, and, you know, giving me their email address, that 100 views doesn't mean anything to me. But if I have one view a day and that person fills out a lead form and starts getting content and, and ends up on my email list, That's, that's a huge metric. So I've started to call these things vanity metrics, and I think people get really hung up on things like Twitter followers or Instagram followers or how many people you have on LinkedIn or how many people are coming to your website. And really, I'm just figuring out that a lot of that is just a bunch of bunk. You've got to really be looking at this. And it goes back to that. I'm not trying to resonate with everybody. I'm just trying to resonate with somebody and look at the quality. Of your effort and the quality of the people that are coming in and engaging with your content. Those are the metrics that are really important. Now, that's hard to measure again. So what I think it is, it's a combination of all of your efforts that end up in a bucket. It's like drips of water into a bucket and people are doing their due diligence and they're online shopping for their financial advice now in a way that they've never done before. And they're looking at all of these things and they're drops in a bucket that finally get to a point where the person is happy with how full it is. So I don't know if there's any one magical metric. I don't know if there's 10. I mean, the ultimate magical metric is they hire you, but, but the metrics leading up to that are a little bit more difficult to figure out intuitively. And that's why I think having an agency that's measuring this, these things for me and coming and saying, Dave, this is working and this isn't, is really helpful to us honing in on our content efforts.

That's great advice. Uh, you know, from a broader level, uh, in the digital age, what in your opinion needs to change about the way advisors, uh, develop a strategy for prospecting?

Well, I don't know if we're ever going to get back to the old way of prospecting again, and I'm using my air quotes, and you can't see this through the podcast, but, um, my fingers are air quoting the old way. And when I mean the old way, I'm talking about 5 years ago, right? Because I've been in the business for over 2 decades now And so is Dean, my business partner. And, you know, we started out with, you know, the telephone. I don't think anybody's using the telephone anymore. So prospecting is always advanced and changed and people have adopted to or adapted to it. I think what's happening now is that the, the old way of networking— so if, if an advisor is somebody who really relied on the face-to-face things, let's say like seminars or just just general networking, the lunches and the dinners and the sporting events and things like that. Boy, I don't know if that's going to come back anytime soon, if ever. So if your mechanism as an advisor for sharing your opinion and your value proposition revolved around that face-to-face networking, I think that that is going to be, um, somebody that's going to have to change their way of prospecting in order to adopt a digital strategy for getting their content and their opinion out there, uh, versus the face-to-face stuff. So I, I think that's hard. And then the other thing is, just because an advisor may be ready to start going to sporting events too, I don't know if the general public will be ready. So until that time, how are advisors going to fill the gap of communicating their opinion and their value proposition in a world where everybody is sitting at home with nothing more than a computer screen?

Well, you mentioned you've been, uh, in the business more than 2 decades. Uh, this has been a journey for you. Can you share any learning points, lessons learned, and mistakes that you had along the way? And in that regard, what are your list of don'ts for marketing strategies?

Here's one of the things I got really caught up in at first with all the social media was you look at some of these advisors out there, we all know who they are, right? Like, I've got the, I've got the most amount of respect for Josh Brown and what he's doing with his content, his marketing strategy. I mean, fantastic, right? And He's got a million Twitter followers. Okay. So at first I thought, well, geez, I need to get a lot of followers too. But what I've started discovering is that it's really easy for a financial advisor to start getting hung up in your followers without really looking at A, what is your, what is your social media strategy in terms of an audience? And B, what is the net result of your effort? Because I feel like a lot of this of, uh, social media activity that's taking place with advisors that I see has become nothing more than this self-licking ice cream cone of advisors talking to each other. Okay, that's great, but I don't know if that's generating any business. I don't know if all of the activity that's taking place around all the advisors talking with each other is really resulting in getting in front of your audience, which is not other advisors. So, so I looked at that and I thought to myself, wow, I'm putting a lot of effort into trying to become more seen as more of an authoritative voice in the social media spheres. But what I caught myself doing was, was seeking validation with other advisors, which wasn't going to generate me any sort of eyeballs on my content. So I scrapped that. I said, you know what, this is not my audience. I do not care If I have 1,000 followers, if 900 of them are other advisors and 50 of them are bots, who am I really talking to here and how much effort am I putting into it? So my advice is this: if you're going to either continue with a social media strategy and/or ramp it up, and especially if you're going to commit financial resources to it, make sure you clearly define who it is that you are trying to reach on those networks and don't Don't get sucked into thinking that just because you're popular in a certain group of people, that you're actually doing anything good for your own business development.

That's interesting perspective and very useful. You know, we have a couple minutes left. I do want you to weigh in on what you think the next 5 years is gonna look like. You've talked about prospecting in the old school way, so to speak, which was 5 years ago. So much has changed in that time period in regards to digital marketing in particular, But look into your crystal ball. Is it— is that rate of change going to continue in the 5 years to come?

I think, I think it will change just by the natural selection of the industry. I mean, every single 5-year period includes advisors who are retiring, right? And I hear this, this statistic that I think is true, which is like half of the advisors in the industry are over the age of 55. I mean, give me some artistic license with that. Data, but I think it's probably pretty accurate. So every 5 years you've got a lot of people retiring. And so I don't know if the change in the industry is going to be completely driven by people shifting to a digital strategy as much as it will be the people who are retiring and aren't adopting a digital strategy will be turning over their businesses to younger people who are very fluent in digital strategy. And so I don't know if it will be so purposeful as it will just be natural that the adoption of the digital medium will become much more of an ingrained thing into a practice than maybe it's been in the past. But I do think that the conscious decision that we will see being made by advisors over the next 5 years is their desire to want to communicate their opinion across the digital medium and trying to figure out unique ways of doing that and getting it in front of people. Because my crystal ball is telling me that while there may be a vaccine someday and there may be, you know, an all-clear signal given on this whole thing, I think that this has radically changed people's lives so much that we have all determined that we don't necessarily need to be going to an office and, uh, going back to our normal routines. I think we have validated from a technology perspective that a lot of industries are able to operate with this work from home and remote working. And the challenge is going to be, if you're working more remote from home, how are you out getting your opinion and your thoughts in front of the people in a way that you weren't able— you're not able to do anymore that used to work in the old days.

Well, you gave us some good specific advice around assessing the vitality of your digital strategy, but I wonder if you can close us out with another final actionable idea you'd offer to the advisors who are listening in.

Sure. So I kind of blew my main one there, but another one I'll tell you is this, and it may it may be a little repetitive from what other people are saying, but it's this: if you're an advisor and you've made it all the way through me talking this long and you're here listening to this and you're not blogging or you're not creating content and you're not— you have not been able to figure out a way or you just haven't wanted to start communicating in the digital medium, you've got to figure out a way to do that. And my advice is always this: sit down and write your mom an email about what happened in the market today, except don't send it to your mom, post it as a blog. And I think some of the most effective blogs that I read are 350 words. And I think people get really wrapped up in this, I've got to be, you know, it needs to sound like a research report and everything else. I mean, I just sit down and write like I talk, and I don't know if the punctuation's right, and I don't know if the grammar is right. And, you know, Sterling, I'll occasionally use a four-letter word in my blog just because that's just how it's coming out of my head at the time. And I've never had anybody come back to me and say, wow, your grammar is really poor, your punctuation was wrong, you had a spelling error in here, I was really offended by the fact that you use this word in your— I've never ever heard that in my entire life. All I hear are, I love that, that was great, I feel like I'm talking to you when I'm reading your blog. And I think if people just start, you know, the journey of 1,000 miles begins with one step. If you take that first step and you get some positive reinforcement from your readers, you're going to love communicating like this.

Well, Dave, you've given us some great information, some great ideas, and some terrific thoughts here. Thank you so much.

You're welcome. This is always a pleasure talking to you and, and all of my colleagues out there in the Barron's universe.

Well, I'd also like to thank all of you for listening in. We'll be back next week with another newsletter and another episode of The Way Forward.

This podcast was brought to you by Wells Fargo Advisors. Looking for a firm your clients can't outgrow? Wells Fargo Advisors offers financial advisors full balance sheet solutions with wealth planning, investment products, banking, and lending that meet the needs of affluent to ultra-high net worth clients. Build your practice your way and on your schedule with independent and employee model options designed to meet your needs today and tomorrow. Learn more at joinwfadvisors.com.