Using a ‘client-centered’ Web site as an efficient part of your practice.

In the old days, financial advisors would open a practice in a storefront location, with a big sign outside to identify the practice and what it did. High-rise office buildings have gradually overtaken the landscape, where the only signage may be a line item on a lobby directory. Financial advisors, therefore, have turned to other means to market and identify their practices. Along with traditional advertising venues, the Internet has emerged as a marketing tool for financial advisors. A Web site can be a great equalizer; the smallest firm can look like a giant corporation with the right Web site.

Many financial advisors have built Web sites to present an identity for their practice and to provide an information portal for clients. The success experienced by using a Web site can depend on several factors.

The Web site as a marketing tool: Many Web sites use outside services to list their site on popular search engines. The search engines themselves offer listing services for a cost. Often this can get quite pricey. A newer technological trend is to use a PPC provider (Pay per Click). With such providers (Overture is probably the largest and best known at this writing: www.overture.com), you select certain listings and bid on the position your listing would hold in a search.

Anyone clicking on your listing and ending up at your Web site would generate a cost for that listing (often in the $.10-and-up range per click). You may also be able to set a budget for your PPC monthly costs. Once the collective hits on your site from the search engines reach your budget amount, you are prompted to add additional money or the listings suspend until your account is replenished. If you spend $50 per month, as an example, and your click-through costs average ten cents each, you would have to exceed 500 hits on your site from the search listings before running out of money that month. This helps to control your marketing costs while keeping you in front of the search listings.

The Web site as a data collector: Do you have a Web site that collects information on your visitors? If not, you are missing an opportunity. A Web site can be designed with something as simple as an information request form. This form might ask for such basic information as name, company, phone number, e-mail address and topic of interest. It could also contain a place to type in a message. Therefore, a visitor wishing additional information or wanting to sign up for a newsletter, etc., can fill in the form and the information is then transmitted to the owner of the Web site. Some Web sites contain free tools or other giveaways that require a similar form to be filled out prior to receiving the tool or giveaway. This may prove to be an effective means of mining visitor information. And, because the visitor opts for it, there is no danger of being labeled a spammer (purveyor of unsolicited e-mail advertising).

The Web site as an information portal: Many financial advisors have chosen to develop a Web site that has a link (or links) to client investment information, which is generally password protected and built inside a secure site. Often this is a link to a broker-dealer or clearinghouse site where such information is stored. Broker-dealers and others make this link available as a convenience to the client. However, such a link on a financial advisor’s site can draw traffic to the site.

The Web site as an interactive tool: A few financial advisors have chosen to use their Web site in a more sophisticated way, by adding interactive elements to the site. Such elements could include links to outside information sources such as stock market data (i.e. electronic ticker tape), stock and bond lookup services or investment research. Additionally, such interactive elements as a series of short media clips on specific subjects, or news sources related to client interests that are updated frequently, can be a reason for clients and other visitors to return to your site.

After all, the purpose behind such techniques is to encourage visitors to return to your Web site several times. Marketing studies have shown that potential buyers are influenced by a marketing message after several hits. That means the more times a visitor visits your Web site, the more likely he or she is to employ your services. Getting them there, then, is one of the keys to success.

Another key to success is the extent of sophistication you can use in your Web site. This depends to some extent on what you may be allowed to do by your broker-dealer and/or state and federal law. Check with those sources to determine what latitude you have in developing a Web site. Assuming you can proceed, the next step is to determine whether or not you can develop a site on your own, or if you must use a Web site development service (approved or provided by your broker-dealer). Many broker-dealers have provided such services at a discount to their reps. The b/d may insist that you use only the approved vendor(s) for a Web site, or it may allow you to choose between vendors and/or developing it yourself (subject to compliance approval).

If developing your own Web site from scratch sounds daunting, it may be wise to investigate some of the better-known vendors. There are probably hundreds, but at least three vendors specialize in financial advisor Web sites:

Advisorsites, www.advisorsites.com

Advisorsites offers a robust set of Web site development services broken down into two areas: custom and templates. With custom, you get the services of professional designers to create your company identity. With templates, you choose from a variety of pre-set template designs for your Web site. Either way, Advisorsites offers a wealth of services to complement your Web site, including brochure design, stationery and other promotional items. Cost can range from $700 to more than $2,000 a year, depending on which package (Silver, Gold or Platinum) you select. Set up charges range from $250 (template) to $3,500 (custom).

The main difference between the packages is the number of services offered to your visitors. Silver, for instance contains financial briefs, stock quotes, client update, Web resources, account look-up and client-forms features, among others. Gold has all of this plus a graphically driven Market Data Bank. Platinum contains all of silver and gold plus two additional areas: featured news and articles of interest. Advisorsites offers a number of optional enhancements as well.

AdvisorSquare, www.advisorsquare.com

AdvisorSquare offers template or customized Web site solutions for financial service professionals. AdvisorSquare also offers some interesting additional features such as LiveSite Manager, which monitors your visitors as they navigate around in your site. Another interesting feature is the LiveLockBox, which is a secure area within a Web site where client documents can be stored and exchanged. AdvisorSquare has teamed up with the firm By All Accounts to provide a Web-based account aggregation service.

The Web site services are broken down into two areas: Business level and Premium level. Base prices range from $79 per month for Business level ($948 per year) to $149 per month for Premium level ($1,788 per year). Additional features are available for an extra cost.

Lightport, www.lightport.com

Lightport offers its services to financial advisors in four client portal packages or fully customized. The four packages (A, B, C and D) come with varying degrees of features, depending on the level of sophistication desired. Portal A is a basic site with tools for setting up and monitoring your site. Portal B (Advanced Client Portal) offers all of Portal A features plus some enhanced reporting capabilities and a virtual safe (similar to the LiveLockBox offered by AdvisorSquare). Portal C (Enterprise Client Portal) offers the widest selection of reporting tools, with targeted navigation tools and ten financial calculators included in the package. (These are available with the other packages at an additional cost.) Portal D (Integrated Portal Solution) allows a company that already has an established Web site to add a Virtual Safe, so it appears to work in tandem with the existing site. LightPort’s Virtual Safe is a secure online repository in which to post and track reports and documents for client access (similar to the lockbox concept).

Lightport claims that its Batch System Integration technology will ensure that the Virtual Safe and its technology work with your company’s specific reporting software, regardless of who that might be. Prices range from $95 per month up to several hundred dollars, depending on the level of customization.

What sets Lightport apart from others is its high-end services for larger asset-based financial advisors. According to LightPort’s vice president of sales, Alex Jansen, “Where we shine is in providing high-end interactive elements, such as dynamic statements, with end-user customization of charts and data so that each client can see exactly what information they need and can use.” Providing such customization comes at a price. But the result is a feature-rich Web site that compels clients to return over and over.

All three of these companies offer similar services for the smaller financial advisor’s practice. Choosing one company and an accompanying package of Web site features may depend first on your budget. Another important consideration is the myriad issues surrounding compliance. A Web site company that tailors its service to financial advisors is more likely to keep your site in regulatory compliance than if you attempted to do it yourself.

Keep in mind what your goal is for having the Web site. If, on the one hand, it is merely to have a site, without any marketing capabilities or client interaction, then it is probably not worth the price, regardless of how inexpensive a particular package is. In other words, what is the point of having a Web site if you do not intend to use it in any meaningful way?

If, on the other hand, your reason for having the site is to encourage clients to use features such as account lookups, client document storage and news features, then this can have a direct, positive impact on your practice. From an efficiency standpoint, the more your clients use such features, the less they are calling your office for the same information. This frees you and your staff for other tasks. If, by leveraging the marketing capabilities of your Web site, you can secure additional clients, then the cost and effort associated with maintaining your Web site can be better justified. Also, a Web site can become a profit center for your practice.

David Lawrence is a practice efficiency consultant and is president of David Lawrence and Associates, a practice consulting firm based in Lutz, Fla. (www.efficientpractice.com)