Morningstar Column: 4 Marketing Strategies for Sustainable Investment Advisors

Written By Phuong Luong

By Phuong Luong, CFP

This column originally appeared on Morningstar.com on August 23, 2023.

This article is part of a series providing a framework for incorporating sustainable investing into your advisory practice.

When considering how to conclude this series on incorporating sustainable investing into your advisory practice, it made sense to discuss how advisors can actually reach clients interested in sustainable investing. Once you have determined your firm’s sustainable investing approach, and filled your toolkit with methods such as crafting an ESG investment policy statement, incorporating sustainable investing in retirement accounts, and shareholder advocacy, it’s time to make your work known to prospective clients. Closing the gap between knowledge and marketing is where many advisors new to sustainable investing can get stuck. While traditional marketing tactics are still useful, there are several ways advisors focused on sustainable investing can differentiate themselves from traditional advisors.

For this article, I spoke with Elizabeth Gilbert Kaetzel, founder of Narratur Studio. She works with sustainable investors and advisors to hone their communication. When working with an advisor, Kaetzel guides them to focus on the following about their ideal clients: who they are, how they feel, what they need, and how to find them. “If advisors offering sustainable investing have a solid understanding of not only their offerings but what will resonate with potential clients, they are setting up a solid foundation for any marketing strategy,” Kaetzel offers.

Be Clear About Your Approach

Communication geared toward advisory clients typically addresses key elements like advisor experience and specialization. Clients seeking an advisor for sustainable investing are also concerned with how the advisor can align investments with their values. To reach this audience, advisors won’t be able to rely on financial jargon to establish expertise. Successful marketing for sustainable investing shows clients that you can help achieve both their financial and sustainability goals.

To do that, advisors should have a clear understanding of their firm’s sustainable investment approach. In a previous article, I spoke on the Morningstar Sustainable-Investing Framework and the Center for Economic Democracy’s Social Movement Investing framework. Advisors should consider their interests, expertise, and capacity to determine which approach(es) and strategies are right for their firms and clients.

Also, advisors don’t have to do it all to attract clients. Sonya Dreizler, ESG consultant and co-founder of Choir, says that “creating marketing (and services!) that attracts the full breadth of [your] niche, allows you to keep your niche the same while growing your opportunity set.” I’ve learned to focus my offerings and increase my expertise on things that my clients care about, increasing their trust and commitment to our work together.

Speak the Client’s Language

Kaetzel says the next step is to translate your approach into digestible and accessible language for potential clients. For instance, including the term “ESG” in your marketing might resonate with a handful of people, but a 2018 report from Allianz showed that only 15% of respondents of a national survey knew what ESG, which stands for environmental, social, and governance, meant. However, 73% of respondents said they cared about “natural-resource conservation or a company’s carbon footprint,” as well as other ESG-related concerns when these were broken down in more relatable language. According to Kaetzel, effective marketing connects a client’s motivation to an advisor’s offerings. “Clients may not know if they are interested in corporate governance issues, but they might already have opinions on investing in companies based on trust and safety practices, board diversity, or environmental impacts,” Kaetzel says.

There are many ways to learn what clients care about. Here are a few that I find useful:

  • Ask your clients. An advisor’s existing clients are excellent resources to learn what investors are looking for and what their concerns are. Both clients with and without sustainable investment portfolios can offer feedback.

  • Check out guides for investors. There are many available resources for investors seeking advisors, such as this list of suggested questions from ValuesAdvisor or guidance from WealthManagement. These resources can offer advisors insight into the questions and concerns that guide a prospective client’s search.

  • Translate impact. Communicate using real-world, plain language examples whenever possible. YourStake, a platform to help advisors create accessible impact reporting, offers a prospective client tool with metaphors and real-world examples of the impacts of sustainable investing.

Using the strategies above can help clients find their ideal advisors, and advisors reach their ideal clients. Perhaps an advisor typically works with clients who are just getting started with sustainable investing. Or maybe they work with younger, next-generation investors interested in making an impact now. An advisor might have clients concerned with building long-term wealth or who are more interested in wealth redistribution and giving. The right messaging will clearly show the relationship between an advisor’s approach and outcomes that match the client’s goals.

Communicate With Your Audience

Once you’ve crafted language that accurately and confidently reflects your firm’s sustainable investing approach and the needs of the clients you want to reach, you can share it widely. This may feel overwhelming at first given all of the communication methods available today, whether digital, print, or in-person. However, instead of trying to be everywhere, advisors can focus on the following strategy: go where your clients are.

The good news is that most likely you can find clients through digital communication. Although the financial advising field began primarily by serving clients in person, now 80% of advisory clients across age groups prefer digital communication. Kaetzel says that the best marketing strategies integrate a number of digital formats, including newsletters, websites, social media, and email. This kind of strategy can increase visibility with prospective clients and build trust with existing clients. While it may sound intimidating, Kaetzel points out that you can start by creating a few impactful marketing pieces to reuse across platforms. “Something like an insightful blog article that resonates with clients can be posted on an advisor’s website, emailed in a newsletter, shared on social media, and even adapted for a conference presentation,” she shared.

Find the Right Networks

Whether an advisor already has a history of sustainable investing experience or is newly incorporating it into their work, there is an advantage to connecting with advisor networks. Participating in groups and gatherings with other advisors practicing sustainable investing provides an opportunity to learn from practitioners and could lead to potential referrals. Participating in networks that include investors interested in sustainability also allows an advisor to keep a pulse on what clients are looking for. In an evolving field like sustainable investing, staying involved in networks can support your professional development and your firm’s ability to adapt.

Networks also offer opportunities for you to share thought leadership. Contributing to podcasts, conferences, webinars, and publications can expand your reach and build credibility. If you are a member of any professional networks it’s worth inquiring whether they have writing or speaking opportunities for members. Many groups also have member-exclusive lists of financial advisors to share when asked for referrals.

Here are some sustainable investing conferences, networks, and media platforms:

*Also hosts an annual conference.

Where to Learn More

A good marketing strategy is personalized to each advisor and their clients, and there are resources to support advisors who want to take the steps outlined in this article. Dreizler has written extensively on incorporating ESG and impact into marketing practices, such as this article on why financial advisors should have a newsletter and tips for implementation. In addition, communication firms like Narratur work with advisors to evaluate and adapt their current messaging to more effectively reach sustainable investing clients and make recommendations on where to focus marketing resources based on a firm’s clientele, budget, and goals. Kaetzel has pointed out that advisors can utilize marketing as a way to both attract clients and make an impact. The right marketing strategy can help advisors reach the growing audience of prospective clients interested in sustainable investing, stay connected to their existing clients, and develop as financial professionals and thought leaders.

Phuong Luong
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