If sorry is clearly the hardest word for politicians - try Messrs Browne and Brown - then marketing ...
If sorry is clearly the hardest word for politicians - try Messrs Browne and Brown - then marketing and innovation must be the hardest in financial services.
Now we've got the news that Hargreaves Lansdown is going to be worth between £650m and £700m when it floats next month, we should add the word congratulations to that list.
So I'd like to congratulate the company because there are few public successes in the independent advice sector and we should all recognise it, because it is a success for the industry as whole and not just HL.
What is its success built on? Many things, not least of which is marketing. A word that has become something of a dirty one in financial services,
HL would not have built a client base of 350,000 without marketing. In reality it has well over a million names of people who have at one time or another received its excellent 'investment times' newspaper.
I mulled this fact over with Andy Merricks of the Brighton IFA firm Skerritts last week, and we were in agreement that not enough advisers really do any marketing. Andy and Skerritts embrace the concept wholeheartedly with columns in local newspapers, all the way through extreme measures like advertising at Brighton football club.
Andy himself used to appear in the News of the World on a regular basis. Not for anything he had been up to, but on its personal finance pages, and this attracted a number of leads for the business.
So how do many advisers get their business? Referrals from existing clients. Not a bad way, but it is potentially fraught with danger, just as recommending a builder or plumber is.
I had this conversation with a senior member of the financial services industry recently who related that after 20 years in the industry, and despite speaking at numerous adviser events, he had never been approached by an intermediary to look after his business.
I, myself, despite grousing in this column over the last few months about advice have only been approached by one adviser to look after my business.
(Thanks to the adviser who did, but as you will have gathered I have sorted myself out).
The message for me is clear. There is nothing wrong with marketing yourselves as advisers.
I was on holiday in Northern France over Easter and I saw more adverts there in the local English language newspaper than I have done in years in the UK. The local firm of advisers to me in North London never advertise in the local newspaper. How does it get business? More importantly, how is it going to grow its business?
The lesson for me about the Hargreaves experience is that marketing works. HL has been going the same amount of time as many advisory firms, and it provides exactly the same service as hundreds of other businesses.
But it takes marketing extremely seriously and now its two founders and a number of other staff are going to be millionaires off the back of it.
Direct sales operates like Allied Dunbar and now St James' Place built their operations on the back of marketing. It worked for them, it can work for advisers.
So dust off your cheque-books, ring the local newspaper and book a few ads, and even offer to write a few articles for them - they might even print them.
You might not end up a multi-millionaire like HL, but you will build a business with considerably more value in at than relying purely on trail commission and an ageing collection of clients.
Lawrence Gosling is the founding editor of Investment Week, his views are his own. Any comments to him at [email protected]