Low-Hanging Fruit To Increase Organic Growth

Catchlight Exec Explains Drivers And Barriers To Organic Growth And Methods For Advisors To Boost Organic Growth
Yelena Melamed, Co-Founder and Head of Product, Catchlight
Yelena Melamed, Co-Founder and Head of Product, Catchlight
James Miller, Contributing Editor & Research Analyst, Wealth Solutions Report
James Miller, Contributing Editor & Research Analyst, Wealth Solutions Report

As Mark Hurley explained at the MarketCounsel Summit, years of low interest rates, low inflation and rising equity markets created an environment conducive to growth, which lulled firms to sleep. Now our industry has entered a different phase without the tailwind of these easy-growth factors. In this new era, firms must find ways to create and boost organic growth amid challenges.

To explore the landscape for organic growth, we spoke with Yelena Melamed, Co-Founder and Head of Product at wealthtech firm Catchlight, which provides services to assist advisors with prospecting and marketing. The firm originated from the Fidelity Labs technology incubator in 2020.

Melamed describes the current status of organic growth in wealth management, barriers advisors face and solutions advisors can implement in 2024 to boost organic growth.

WSR: How is organic growth faring in wealth management today, and what is the source of that organic growth?

Melamed: In recent years, we’ve observed wealth management organic growth generally hover in the low single-digit percentages. However, discerning a more dynamic trend, some firms are increasing their investments in sales and marketing, yielding notable success. Successful organic growth can offer a cost advantage compared to inorganic activities.

Our interactions with industry players reveal a concentrated focus on critical areas such as lead generation, branding and software. A closer examination unveils a commitment to both paid and earned lead generation, engaging content strategies for prospect interaction and the implementation of intelligent workflows.

The firms we work with, that are focused on organic growth, seek new clients as well as the opportunity to deepen relationships to increase the wallet share of existing clients.

WSR: What are the primary barriers to organic growth that advisors face today?

Melamed: Over the past decade, aside from a few exceptions, we’ve witnessed a robust market driving growth for wealth management firms. However, this prolonged period of success has led some firms to curtail their marketing investments, inadvertently leading to a weakened funnel for new prospects.

Organic growth is not a spigot that can be turned on and off.

Reinvigorating a firm’s organic growth program is imperative as competition for new clients intensifies. One of the barriers we’ve observed is the lack of commitment to establishing a growth process. Organic growth is not a spigot that can be turned on and off. It requires a committed budget, resources and a process to identify, prioritize and engage with a firm’s ideal client.

We hear from firms that are struggling with organic growth that they simply don’t know where to start. The good news is that there are tried and tested processes. It will take time and effort. We believe the key lies in creating a program that evolves through continuous testing, learning from every step to achieve ongoing refinement and improvement.

WSR: Is there any low-hanging fruit that advisors can implement in 2024 to boost organic growth?

Melamed: There is much low-hanging fruit to drive more immediate results. Many firms we speak with have thousands of leads and are challenged by where to start. They simply cannot call all of them.

There are simple yet potent solutions like segmentation and lead scoring.

There are simple yet potent solutions like segmentation and lead scoring. These tools empower firms to discern high-potential prospects from the rest, offering a strategic starting point. Insights derived from these leads aid in prioritizing outreach efforts, ensuring a targeted approach.

Crafting personalized, one-to-one outreach campaigns for the most promising prospects and adopting segmented strategies for others in the pipeline serves as a dynamic way to help capture the attention of a diverse range of leads.

A retrospective glance in the rearview mirror can be enlightening. Identify the lead sources that have yielded your best clients and determine how best to scale them. Amplify campaign activities to reignite those sources and generate a fresh influx of high quality leads. It’s about homing in on the prime opportunities for maximum impact.

James Miller, Contributing Editor and Research Analyst at Wealth Solutions Report, can be reached at ContributingEd@wealthsolutionsreport.com.

Total
0
Shares
Related Posts
Read More

Are IBD And RIA Channels Converging?

As Regulatory, Market And Industry Shifts Continue, Differences Between The Channels Are Blurring Darwin’s maxim, that those best…

Sign Up for Our Newsletters

Sign Up for Our Newsletters