Almost every financial firm has at least considered buying leads for their business. However, is it a good idea?
Buying pension leads and other off-the-shelf email contacts may seem like a viable way to gain more clients. However, in 2022 it is becoming increasingly difficult to make it work. Instead, we believe there is a better way – i.e. building your own marketing strategy and infrastructure, rather than relying on someone else’s.
Below, we outline the pros and cons of buying pension leads versus crafting your own lead generation strategy. We hope this sparks some ideas for your own financial marketing. Please get in touch if you’d like to discuss your campaign with us.
The pros & cons of buying leads
As a financial services firm, buying leads from a third-party vendor has the advantage of speed. Simply contact the business, purchase a list of contacts (potentially holding 1,000s of email addresses) and you’re ready to go.
However, you face an uphill battle with converting these contacts into interested, qualified leads. First of all, the people on the list have almost certainly never heard of you before. So, you will have a hard time building their trust so they want a consultation with you.
Secondly, other financial firms almost certainly will have had the same idea as you. The list you have in your possession is likely in the hands of hundreds – if not thousands – of other businesses. The list will likely have been bombarded with their emails already. This means that the recipients will be overwhelmingly deaf to your efforts to contact them.
If anyone on the list was interested in a financial service’s offering, then they likely will have chosen one of the previous buyers of the list, already. However, if they are not interested, then all of the emails from these various businesses will likely put them off entirely.
Another thing to consider is the compliance of the third-party vendors providing the leads to you. How can you know, for sure, that the advertising they used to acquire the leads was appropriate and met the standards required by the FCA and others?
There are at least two other drawbacks of third-party pension leads to consider.
Firstly, you have no control over the pricing from lead generation vendors. All of a sudden, they might choose to raise the cost for each lead. This could suddenly derail your progress towards your client acquisition target, as the return on your investment (ROI) vanishes. One very prominent financial adviser directory did this last year.
Secondly, by simply buying off-the-shelf leads, most financial firms neglect to invest in their own digital marketing strategy. This leaves your marketing vulnerable to future changes in the regulatory landscape, or to your lead generation provider potentially going bust.
By having a lead generation strategy of your own, however, you can diversify across many lead acquisition channels.
The alternative: your own marketing strategy
When you start building your own digital marketing infrastructure, it can feel very slow and takes a fair bit of effort.
There are various tools and accounts to set up (e.g. Google Analytics, Google Search Console and perhaps Google Ads). You will also need a strong brand and website to engage online prospects.
If these are not up to standard, then you may need to invest in re-designing them.
However, once all of these assets are in place, you put yourself in a strong position to build up a strong lead generation “machine” that is sustainable, effective and which puts you in the driver’s seat.
For instance, consider what could happen if you managed to get your website into the top Google search results for your target keywords. No longer are you relying on a directory, where prospects have dozens of other potential competitors to choose from. Instead, the prospect comes straight to your website, content and value proposition.
Moreover, if the regulatory landscape changes, then you are in a stronger position to pivot your marketing strategy and lean on your other marketing channels. For example, suppose the FCA clamped down on third-party pension lead providers, barring them from showing ads on Facebook and Google and only allowing firms on their register to do this. As a regulated firm, however, your business is likely to be unaffected (assuming your ads are compliant).
By building your own strategy, moreover, you have a better chance of converting your prospects. Those who come via Google search, for example, are already further along their “buyer journey” since they are actively looking for a service like yours. People on an off-the-shelf email list, however, may not be interested at all in what you have to say.
You also have the chance to lower your costs. Suppose you have 4-5 marketing channels which generate leads for your financial firm. You can analyse each one to determine lead volumes and cost-per-acquisition. If any are not performing as well as you’d like, then you can take steps to optimise them. Or, if they are not working, you can minimise your investment in them or even discard.
In our opinion, there is a strong case for financial firms to invest in their own marketing rather than relying on third-party leads.
Today’s consumers are increasingly allergic to cold calling and other intrusive forms of marketing. Rather, people prefer to find things out for themselves and deal directly with a business (unless they are using, say, a comparison site).
Interested in getting started with your own lead generation campaigns? Get in touch to arrange a free, no-commitment consultation with our team to explore some ideas together!