Philip Calvert: encouraging IFAs online.

Daily internet usage in the UK is increasing by 22% year on year and there are strong adoption rates among older and more affluent demographics. These are key markets for the financial services community, according to Google, which is aiming to tempt more independent financial advisers (IFAs) into using the internet to promote their businesses.

Searches on financial-related terms are growing consistently and increased 19% year-on-year in 2009, as users embraced the internet as a medium for their financial research. According to a new Google white paper*, with 30% of adult internet users earning household income of more than £50,000, the online market is one IFAs should be aiming to capture.

Internet marketing specialist Philip Calvert, who founded IFA social networking site IFA Life, told ModernSelling.com: ‘It’s great news that consumers of all demographics are taking control of their personal finances. Because the internet is now part of people’s lives, it’s not surprising that they increasingly use search to find financial help and advice.’

Missing out

He added: ‘What’s not such good news, however, is that IFAs are missing out on a wealth of opportunity online, and risk becoming increasingly sidelined in the online world if consumers cannot find them in searches.’

Wealth management is a big opportunity for IFAs online, Calvert claims.

He points out that financial advice searches have grown strongly over the last 18 months, with the search term ‘unbiased financial advice’ logging 84% more queries in February 2010 than in February 2008. He predicts that, as the internet becomes an integral and even primary component of financial planning, companies with a strong online presence offering products or advice are benefiting from the growing demand, whilst those which continue to rely solely on traditional sources of leads such as word of mouth and directories risk falling behind.

Internet presence

Although query volumes have increased, the majority of IFAs have failed to step up their internet presence, either through maintaining a healthy website or through promoting themselves with online advertising. It is vital for IFAs not only to have a good website, but to use all means possible to drive potential leads to find that website, Calvert says. Many IFAs are failing on one or both of these steps, meaning that online consumers are not finding them. Calvert says IFAs are missing out on business, as potential customers are forced to look to other online sources of advice which are only a click away.

Shaken consumer confidence

In recent years and with shaken consumer confidence in traditional financial establishments, many new online businesses have become popular sources of advice, with comparison sites like Moneysupermarket.com and forums such as Moneysavingexpert.com benefiting from the preference for independent online advice and information. This consumer behaviour gives online IFAs a great opportunity to gain consumer trust and build their businesses online. Despite scepticism amongst many IFAs that older, high net worth individuals use the internet as part of their financial research, studies indicate that this group does increasingly search online.

Head of Finance at Google UK, Ian Morgan said: ‘This market represents a real opportunity for financial planners online because queries in this sector have grown strongly over the last few years, yet the lack of advertising by IFAs to this market means that they are missing out on valuable leads.’

He added: ‘We want to offer more support to IFAs looking to grow their business through effective use of search marketing. Our aim with our white paper and forthcoming webinar is to offer an educational starting point to these financial advisors. Consumers are looking for guidance in their wealth management and we believe that the internet can play an important role in helping them find the appropriate support.’

IFA comments

And there are examples of IFAs, who have embraced the internet, seeing positive results. Tina Weeks of Serenity Financial Planning in north London said: ‘It’s unimaginable that any IFA firm could even survive today without the internet. It’s now an essential part of our lives and the lives of our clients, so it’s vital that we keep on top of all the different ways that it can be used and build value in our business whilst adding value to clients. I also recommend that every IFA puts time aside regularly to get trained on internet marketing.”

Keith Churchouse of Churchouse Financial Planning in Guildford added: ‘Economies of scale help us as financial planners to diversify our marketing message using the internet and the accessible and cost-efficient tools available. Blogger.com is an excellent example, allowing us to distribute topical issues electronically as well as our own website and where appropriate, podcasts. Additional news can also be distributed by the use of social media which we use regularly.’

However, whether the initiative will be seen as anything more than an attempt by Google to drive its AdWords advertising revenue in the financial services space will depend on the level of business generated by IFAs using the online model.

Google’s white paper *IFAs in the Digital Space is available now through the IFA Life portal for an exclusive period while its educational webinar will be available to download from the 1 July. The webinar is hosted by Google’s finance team and will include demonstrations of how to use Google’s free online resources to identify and benefit from the online opportunity, as well as tips for getting started on AdWords. Google will be offering an AdWords voucher to IFAs trying AdWords for the first time, available via email.