Handcuffed by marketing inertia?

Bartlett Wealth Management celebrated its 125th anniversary this year. One of the firm’s core beliefs is caring for clients and developing deep, meaningful relationships with them. 

New advisor advertising rules that went into force last November create an avenue for Bartlett to tell its story through the investors it serves. For the first time, the Securities and Exchange Commission’s marketing rule allows advisors to use client testimonials and endorsements. 

“For clients to speak … on our behalf is invaluable,” said Maggie Spataro, Bartlett’s marketing manager. “That opens up a whole new world for us to demonstrate the depth at which we do our job. There’s nothing like hearing it from the source.” 

But prospective clients for the firm’s 33 advisors won’t hear from its current clients for now because Spataro is hesitant to use testimonials. The new marketing opportunities in the 430-page SEC rule also come with many disclosure obligations and restrictions that give advisors compliance worries. 

“We are still getting the lay of the land,” Spataro said. “We’re not looking to be the bleeding edge. We want to implement things at a pace that we feel comfortable with and that we can understand.” 


That kind of cautious attitude is one that many advisors are adopting. 

“You still don’t see the vast majority of advisors leveraging the opportunities for testimonials and endorsements in the new marketing rule fully yet,” said Robert Sofia, CEO of Snappy Kraken, a marketing consulting firm. 

A testimonial involves a client touting a firm. An endorsement is from a non-client. Either form of advertising must come with three prominent disclosures visible within the ad: The advisor must indicate whether the promoter is a current client or investor, whether the promoter is compensated for the ad and whether there are any material conflicts of interest. 

The marketing rule requires that advisors substantiate the claims made in their ads. They must keep copies of their ads and backup materials the SEC can examine. Performance advertising is permitted under the rule and comes with its own requirements. 

There’s also a set of general prohibitions. For instance, advisors cannot make untrue or misleading statements of fact in their marketing. Their ads also must be “fair and balanced,” addressing the potential limitations or risks of the services and advice they’re touting. 


It’s a lot to unpack. The SEC issued guidance last September and again in June. But advisors still have questions. 

“Firms are doing the best they can given the lack of guidance and clarity from the SEC on certain issues,” said Sanjay Lamba, associate general counsel at the Investment Adviser Association. 

A marketing consultant gets the same vibe from many of his advisor clients. 

“A lot of them are still hesitant because of how gray and murky [the marketing rule] remains,” said Brian Hart, founder and president of Flackable and author of the forthcoming book Credibility Marketing

Advisors can’t rely on best practices for activities allowed under the marketing rule — such as testimonials, endorsements, third-party reviews and using performance results — because they haven’t been developed, said Michael Kitces, chief financial planning nerd at Kitces.com, an advisor education and research platform. 

“I’m hearing, ‘We’re going to wait another year or two to let compliance experts figure out the 100% way to do this that can’t possibly get me in compliance trouble,” Kitces said. “Very few firms want to be on the bleeding edge of [the marketing rule] unless they’re really growth-oriented.” 


The SEC is establishing more expectations for marketing rule compliance through enforcement actions, which have focused on performance advertising so far. 

The first, on Aug. 21, was a penalty of more than $1 million imposed on robo-advisor Titan Global Capital Management USA for misleading portrayals of hypothetical performance. The second, on Sept. 11, was against a group of nine firms for advertising hypothetical performance to the general public on their websites without having policies and procedures in place to ensure the ads targeted an audience with the appropriate financial situation and investment objectives. Each firm paid a penalty ranging between $50,000 and $175,000. 

“Of all the provisions of the marketing rule, the performance provisions have been the most challenging to implement,” said the IAA’s Lamba. “Some firms are opting not to give that information, which is unfortunate.” 

Despite the potential risks of using testimonials, marketing professionals tout the advantages for advisors. The “consumer buying journey” has changed, said Meg Carpenter, CEO of Ficomm Partners, a marketing consulting firm. 

A couple of decades ago, a prospective client might have visited an advisor’s office immediately after getting a referral. Now, there’s a crucial step before that point. The prospect will look at the advisor’s website and do other online research to validate the advisor. That’s where client testimonials can have a strong impact. 

“We really believe in using the client voice,” Carpenter said. “Everyone looks at reviews. There’s a huge opportunity for advisors to be the first movers in integrating client voice into their brand and marketing strategies. Many financial advisors have inertia around marketing, and they don’t pass go.” 


Testimonials provide “social proof” for an advisor, Sofia said. They make it more likely that someone visiting an advisor’s website will subscribe to a newsletter, download a report or take another action that requires their contact information. 

“It drives at least a 20% increase in conversion rates on websites and landing pages when you have a testimonial from a client,” Sofia said, citing a statistic from a study he will publish later this year. 

Some advisors may be reticent to ask clients to speak on their behalf. But if they do, they’re likely to get a good reception, said Brian Thorp, founder and CEO of Wealthtender, a digital marketing platform. 

About 50 of the 320 advisors on the site use client reviews. Thorp helps ensure advisors gather and post the reviews in a way that is compliant with the SEC marketing rule. 

“There’s a real willingness and enthusiasm by clients to put together a thoughtful review,” he said. “It’s terrific to see all the positive comments.” 


Clients don’t usually mention investment returns. Instead, they concentrate on the relationship they have with the advisor. 

“What they’re really talking about is how their advisor makes them feel,” Thorp said. 

Sara Stanich, founder of Cultivating Wealth, was a marketing professional before she became an investment advisor. She said she always thought it was strange that advisors couldn’t use testimonials. 

She didn’t waste any time incorporating them in her own marketing efforts. She started posting client comments on her website in December. 

“It increases credibility with prospective new clients,” Stanich said. “I see only benefits to be gained from [using] client testimonials. Everybody I asked was happy to help.” 

She is confident the firm is meeting the SEC’s expectations when it comes to testimonials because she has outside help in that area. 

“We ran it by our compliance consultant,” Stanich said. “Keeping on top of compliance regulations and details is not the best use of my time. I always confirm things with my consultant.” 


But more advisors are like Geeta Brana, owner of Geeta Brana Wealth. Her firm specializes in helping women who are going through difficult life transitions. She builds her brand in Monmouth County, New Jersey, and the surrounding area through charitable organizations that help women in crisis. She’s the founder of one of them, Women Helping to Educate and Enhance Life. 

“I’m old-school,” Brana said. “I’m reluctant to use testimonials. I prefer to use what I give back to the community as my marketing base.” 

Her “old-school” approach to marketing is reflected across the sector. A study last year on advisor marketing by Kitces Research shows the top four marketing strategies are client referrals, centers of influence, social media and general networking. Almost every advisor uses client referrals — about 93% — but only 41% use social media. 

“The majority of advisors don’t use the marketing channels that the marketing rule benefits,” Kitces said. “The overwhelming majority of advisory firms aren’t likely to use testimonials and may never use testimonials.” 

The SEC marketing rule applies to advisors who are registered with the agency and have $100 million or more in assets under management. Advisors with less than $100 million are registered at the state level and would only be able to use testimonials if there’s a state regulation similar to the SEC rule. 

“Smaller advisors will struggle with this because they may be in a state that hasn’t adopted the SEC marketing rule,” Kitces said. 

Trying to nudge advisors to jump into the testimonial waters will continue to be a challenge for advocates. 

“It’s taken some convincing for the few firms that have done it,” said Jonny Swift, vice president of Impact Communications. 

He understands the compliance and other concerns that make most advisors reluctant to use testimonials. But he stresses there’s also a great opportunity for them. 

“There’s a fine line there,” Swift said. “It’s a fresh and fertile territory. Firms that aren’t taking advantage of this are missing an opportunity to stand out from competitors.” 


That could lead to something all advisors want — organic growth. 

“The industry is recognizing that organic growth is critical for building a sustainable business,” Carpenter said. 

The SEC marketing rule will have been in force for a year in November. Not long after that — perhaps in the fourth quarter of this year or the first quarter of 2024 — Bartlett may unveil its first testimonial, Spataro said. 

“It’s a wonderful opportunity,” she said. “We want to make sure we feel positive and confident going into it.” 

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