Prospecting or lead generation: which strategy should a Financial Advisor choose?
For an Independent Financial Advisor (IFA), generating qualified leads is essential to boosting business and attracting new customers. In this article, we'll examine the differences between prospecting, lead generation and lead qualification, and determine which strategy is most appropriate for your practice. Prospecting, lead generation and lead qualification are three terms that are often used together, but they have different meanings. Prospecting refers to the act of seeking out potential contacts for a company, while lead generation concerns the process of creating potential contacts. Lead qualification involves assessing the quality and relevance of these potential contacts to determine whether they are genuinely interested in the products or services offered by the company.
Understanding prospecting
Prospecting is the first step in the sales process. It involves actively seeking out potential customers and arousing their interest in your products or services. The main aim of prospecting is to find relevant buyers who may not yet be familiar with your company.
Objectives and methods
The objectives of prospecting include identifying potential new customers, establishing initial contacts and initially qualifying prospects. Prospecting methods may vary, but often include activities such as :
Cold calls
Prospecting emails
Meetings at events
Social networks like LinkedIn
Prospecting
Prospecting is the process of identifying and contacting potential contacts for a company. This can include direct marketing techniques such as leaflets, telephone calls or e-mails. Prospecting can be carried out using contact lists, online research or social networks.
Examples of prospecting activities for a financial advisor?
Let's take the example of a wealth management firm in its start-up phase. To prospect, the Wealth Advisor and his teams could :
Cold calling using directories to present their wealth management solutions.
Send personalized emails using data brokers
Participate in events and networks such as BNI
Post on social networks to raise your profile and build your digital notoriety
Prospecting enables us to establish direct contact with potential prospects, which can speed up the sales process. However, it often requires manual effort and can be time-consuming. Don't confuse prospecting with digital prospecting.
What is lead generation?
Lead generation is a marketing strategy aimed at attracting and converting strangers into prospects interested in your products or services. Unlike prospecting, lead generation is often a longer-term, more marketing-oriented activity.
Differences from prospecting
The main difference between prospecting and lead generation lies in the approach. Prospecting is proactive and direct, while lead generation is more indirect and focused on attraction. Lead generation uses marketing techniques to attract prospects to your company, rather than contacting them directly.
Examples of lead generation actions
To generate leads, a company could :
Create quality content such as blog articles, ebooks or webinars.
Use SEO to attract organic traffic to your website.
Launch advertising campaigns on social networks and search engines.
Offer free resources in exchange for visitor contact details (lead magnets).
Lead generation creates a constant flow of interested prospects without the need for constant human intervention. It relies on automation and content marketing to nurture prospects until they are ready to be contacted by the sales team.
Lead generation
Lead generation is the process of creating potential contacts who have expressed an interest in the products or services offered by a company. Leads can be generated using a variety of strategies, such as digital marketing, social networking, e-mail or advertising campaigns.
The benefits of prospecting
Prospecting offers a number of advantages, particularly in the short term. It enables direct interaction with prospects, which can speed up the sales process.
Short-term benefits
One of the main advantages of prospecting is its ability to generate sales opportunities quickly. Sales reps can identify and qualify prospects in real time, enabling them to quickly fill the sales pipeline.
Direct interaction with prospects
Prospecting also enables direct interaction with prospects, which can help build a relationship of trust from the outset. Sales reps can respond immediately to questions and objections, which can increase the chances of conversion.
Examples of successful prospecting
An example of successful prospecting might be a financial services company that uses cold calling to contact decision-makers in target companies. By personalizing their approach and offering tailored solutions, they succeed in converting a significant percentage of these contacts into customers.
Prospecting is particularly effective for companies needing quick results or targeting niche markets. It enables you to establish direct contact with prospects and quickly qualify their interest.
The benefits of lead generation
Lead generation offers long-term benefits, particularly in terms of automation and scalability. It makes it possible to create a constant flow of qualified leads without the need for constant human intervention.
Long-term benefits
One of the main advantages of lead generation is its ability to create a pipeline of qualified prospects over the long term. By using automated marketing techniquescompanies can attract and nurture prospects without constant manual effort.
Automation and scalability
Lead generation can be easily automated using marketing and CRM software. This makes it possible to manage a large number of prospects with a minimum of effort, which is particularly useful for fast-growing companies.
Examples of successful lead generation campaigns
An example of a successful lead generation campaign for a Wealth Advisor depends largely on the choice of target and budget. An example of a lead acquisition campaign for a healthcare professional target could revolve around advertising campaigns (Google and Meta) targeted at hospital areas to grab your target's attention with a webinar or guide to capture the prospect's data. Offering a free appointment or even a quiz would capture your target's contact details, and maintain a link through an email campaign.
When should you choose prospecting?
Prospecting is often more effective in specific scenarios. It is particularly useful for firms that need quick results or that target niche markets.
When should you opt for lead generation?
Lead generation is often most effective in scenarios where a long-term approach is required. It is particularly useful for companies looking to build a strong brand and attract a large audience. Lead generation is ideal for companies that have the time to nurture prospects over the long term. It is also effective for companies selling products or services with a long sales cycle.
Combine prospecting and lead generation
Combining prospecting and lead generation can deliver significant benefits. This integrated approach maximizes sales opportunities by leveraging the strengths of each strategy.
Strategies for integrating the two approaches
To integrate prospecting and lead generation, companies can use techniques such as :
Use lead generation to attract prospects and prospecting to qualify them.
Nurture generated leads with personalized content and follow-up.
Use CRM tools to track and manage interactions with prospects.
Combining the two approaches maximizes sales opportunities. The leads generated can be nurtured and qualified before being passed on to the prospecting team, increasing the chances of conversion.
Examples of mixed strategies
An example of a blended strategy might be a financial services company that uses lead generation campaigns to attract prospects via webinars and ebooks. These leads are then qualified and followed up by the prospecting team, who contact them directly for personalized consultations.
Combining prospecting and lead generation allows you to leverage the advantages of each approach. Generated leads can be nurtured and qualified before being passed on to the prospecting team, increasing the chances of conversion.
Tools and resources for prospecting and lead generation
There are many tools and resources available to help Wealth Advisors firms succeed in prospecting and lead generation. Here are just a few examples:
Prospecting tools
LinkedIn Sales Navigator: find and contact targeted prospects on LinkedIn.
ZoomInfo: provides accurate contact data for decision-makers in various industries.
Outreach: lead engagement platform that automates email and follow-up sequences.
Lead generation tools
HubSpot: marketing automation platform for creating landing pages, forms and email campaigns.
Unbounce: tool for creating conversion-optimized landing pages.
Leadfeeder: identifies companies visiting your website and provides information about their interest.
The difference between lead generation and lead qualification
Although often confused, lead generation and lead qualification are two distinct stages in the customer acquisition process. Understanding the difference is essential to optimizing your strategy.
Lead generation
Lead generation involves attracting potential prospects and encouraging them to express interest in your products or services. The aim is to collect their contact details so you can contact them and nurture them until they're ready to buy.
Lead generation techniques include :
Creating compelling content (blog posts, ebooks, webinars)
Search engine optimisation
Online advertising campaigns
Trade shows and events
Lead qualification
Lead qualification involves evaluating the potential and relevance of the prospects generated. The aim is to determine whether they correspond to your ideal customer, and whether they are ready to commit to the purchasing process.
Qualification criteria may include:
Budget and purchasing authority
Need and urgency
Matching your offer
Commitment and interest
Qualification can take the form of qualification forms, discovery calls or personalized interactions.
Lead qualification
Lead qualification is the process of verifying the quality and relevance of the potential contacts generated. This involves assessing whether the leads are genuinely interested in the products or services offered by the company, and whether they have a buying opportunity. Lead qualification makes it possible to eliminate irrelevant contacts and target leads with the potential to become customers.
Understanding the difference between lead generation and lead qualification can help you optimize your sales process. Lead generation provides you with a pool of potential prospects, while qualification enables you to concentrate your efforts on the most promising ones.
Effective lead qualification means you don't waste time and resources on prospects you can't serve. In the case of a Wealth Advisor , it's usually the amount of savings available that qualifies the lead. The difficulty lies in the fact that prospects don't like to reveal the size of their assets out of modesty. Using a quiz is a good way of getting around this problem.
Which strategy is right for your firm?
There's no single strategy that's right for every practice. It's important to determine your firm's objectives and choose the strategy that best suits your business. Here are a few things to consider when creating a marketing plan :
Identify your objectives: What are your marketing goals? What products or services do you want to promote?
Evaluate your resources: What are your marketing resources? What tools and resources do you have at your disposal?
Choose the strategy that best suits your practice: If you have a limited budget, prospecting may be a more expensive option, as it requires investment in physical resources and/or time. If you have limited resources, digital marketing may be a more economical option.
Budget for prospecting campaigns
How much should you invest in a lead generation system?
Rise Digital offers a package to enable Wealth Advisors to set up a lead acquisition system. But before determining how much to invest in a lead generation system, it's important to understand the benefits and costs associated with this strategy. Here are a few things to consider:
Fixed costs: fixed costs include system development and installation costs, as well as maintenance and updating costs.
Variable costs: variable costs include advertising, management and content creation costs.
Expected return: it's important to determine the expected return from your lead generation system, i.e. the number of leads generated and the conversion of these leads into customers. It's a volume game. For example, by attracting 100,000 visitors to a Google ad, you can aim for a click-through rate of 1-5%, i.e. 1,000-5,000 people visiting the landing page. With a good match between the visitor's need and the page's offer, we can work on a conversion rate of between 2-5%. These figures are international averages (US) and will vary according to industry.
Budget for effective lead generation
How much should you invest in your marketing as a Wealth Advisor ? As always - it depends. We often talk about a recommendation of between 10% and 20% of sales. However, during my discovery calls, I note that Wealth Advisors ' marketing budgets can be categorized into 3 groups:
Less than €5,000 per year - equivalent to approx. €400 per month
Between €5,000 and €10,000 per year - equivalent to approx. €800 per month
More than €10,000 per year - equivalent to approx. €1,000 per month
Minimum investment
In general, it will be difficult to set up a simple automated lead acquisition system for less than €500 per month. This budget includes the cost of digital marketing tools (landing page creation, email automation and a bit of advertising) but involves in-house campaign management and will have limited results.
Recommended investment
A more advanced lead generation system, including automation tools, activation of multiple acquisition channels, content creation and outsourced campaign management, requires an investment of at least €5,000.
Would you like to test an automated prospecting campaign? Our teams of experts accompany financial players throughout their conversion tunnel, working on each phase of lead maturity. Our methodology aims to achieve the same objective as you: signing up new customers.
FAQs
What's the difference between prospecting, lead generation and lead qualification for a Wealth Advisor ?
Prospecting is the active search for potential customers, lead generation attracts prospects through marketing strategies, and lead qualification evaluates prospects' relevance and interest in the services offered.
How can an IFA generate qualified leads efficiently?
A Wealth Advisor can generate qualified leads by creating quality content, optimizing their site for SEO, using social networks, and offering free resources in exchange for contact details (lead magnets).
What are the advantages of combining prospecting and lead generation for a Wealth Advisor ?
Combining the two approaches maximizes sales opportunities by leveraging the strengths of each strategy: prospecting delivers rapid results, while lead generation ensures a steady flow of qualified prospects over the long term.
What tools and resources can help Wealth Advisor prospect and generate leads?
Tools like LinkedIn Sales Navigator, HubSpot, Unbounce, and ZoomInfo can help you prospect and generate leads by automating tasks and providing accurate contact data to target prospects effectively.
Which strategy is more appropriate for a Wealth Advisor Advisor: prospecting or lead generation?
The appropriate strategy depends on the Wealth Advisor's objectives and resources. Prospecting is ideal for quick results and niche markets, while lead generation is more effective for long-term strategies and building a strong brand.
