Events, Industry Cred Set High-Growth Firms Apart: Report

Turns out, eating isn’t the only part of life where organic alternatives cost more. They also carry a premium when it comes to growth.

Last year, advisory practices actively pursuing expansion averaged about 9% organic revenue growth, while more mature firms not seeking to grow averaged about 5%. And advisory firms spent less last year on marketing as a percentage of overall revenue than in previous years, according to the latest report from Kitces research, at just 7%, reflecting the decline in firm revenues following 2022’s market downturn. Still, the vast majority of that value comes from advisor time — the time it takes to, say, write a newsletter — and marketing ROI doesn’t scale with AUM. According to the report, marketing costs tend to go up as a share of revenue as assets increase, but the returns diminish for larger firms.

“Advisors have access to more shiny bells and whistles than ever before,” said Becca Zophin, chief marketing officer at Integrated Partners. “It’s nearly impossible to stay ahead of every trend, and more marketing and activity doesn’t necessarily create more growth.”

High (Growth) in the Sky

Parsing through the data shows differences in how “high-growth” practices — those with organic new-client revenue growth rates in the top third of the firms surveyed — crafted their marketing strategies. They were more likely to use SEO, as well as to maintain active listings in online advisor directories. In other words, they were more likely to turn away from tactics that required a lot of time and effort up front in favor of those that made themselves more visible online to the curious client searching for a new firm.

According to the report, high-growth firms were also more likely to:

• Have at least one advanced industry designation, such as the CFP or ChFC (from the American College of Financial Services), as well as to have a more niche credential.
• Consult with at least three different sources of information (such as conferences, industry research or consultants) when devising their marketing plans.
• Use strategies that “actively increase visibility,” like in-person networking events, webinars and client appreciation events.

AEO, And Sometimes Y. AEO, or answer engine optimization, was also included in the Kitces report for the first time as a tactic used by firms to appear in answers generated by AI. This strategy’s usage rate is already at 10%, suggesting advisors’ acknowledgement that chatbots are increasingly being used by clients to find a new advisor. And it can be surprisingly effective: The rate at which potential clients became customers doubled in the fourth quarter last year compared with the same quarter in 2024, with much of that website activity being AI-driven, according to a recent Snappy Kraken report.

“Context is being gathered, and then AI makes a recommendation,” Sofia told Advisor Upside last month. “By the time [potential clients] come to the advisor’s website, they’ve already determined that they need a financial advisor, so it’s higher-intent traffic that’s more educated and therefore converting faster.”