In my previous article about ‘4 ways brokers approach marketing’ I have presented some basics. In the following article my goal is to highlight the most important aspects where brokers (often referred as professionals) tend to make obvious mistakes in marketing and PR activity. It can be simplified to the quote I have read some time ago:

“If you think it’s expensive to hire a professional, wait until you hire an amateur.”

Being in the business for a while I have noticed that many companies do not manage their marketing properly, therefore being unable to benefit from opportunities or to limit damage from mishandling marketing crises. On one hand, those brokers are just wasting resources on missed campaigns, but on the other hand they are wasting future resources required to rebuild their image. Here are some examples of most common mistakes I’ve seen that made brokers to waste their time and money, and since time is money, they wasted money twice.

Don’t try this at… your brokerage

1. 

   Do not go random. Many companies contact us asking about specific marketing action such as position in brokers’ list or a single sponsored publication. When I ask them, what kind of strategy do they execute, I cannot get straight answers. Such companies usually do not have any strategy and they do not know what they are doing and why. They just know that they need to have marketing. The thing is, such random actions usually give random results and you never know what you should expect. You cannot manage random relations and random results or create proper image of your business.

2. Don’t let your offer to be a blunt tool. If your offer does not provide you with some edge, if you do not have any advantage on the highly competitive market, then your business needs to focus on an unknowing client who probably will leave you shortly. More experienced traders probably won’t be interested in such offer long enough. Moreover, some brokers try to promise things that they are unable to deliver. For example, they promise ultra-tight spreads lowering profit margin so much that they need to compensate it elsewhere – e.g. with relatively big slippage or B-book related practices against clients such as delay, disconnects, ‘badticks’ or spread widening. Once traders recognize these practices negative impact can be huge wiping out most effects of a marketing campaigns. Being fair is the best start to marketing.
3. Poor conversion does not necessarily mean poor marketing. Many brokers blame marketing for poor results while the problem is in their uninteresting offer. It is like poor, dirty restaurant with high prices where owner is sacking marketing guys one after another for poor results. There was the case when broker offered no deposit bonus which didn’t do much good for him, cause people were afraid of the broker’s overall image and uninteresting offer.
4. USPs sound like a bad joke. Many brokers formulate their Unique Selling Points in a wrong way. When a broker who would like to start marketing with Comparic approaches me, I usually ask the question: “what are your USPs”? Too often the answer starts with “award winning platform”, “award winning broker”, “very attractive costs”. The problem with such answers is that these USPs mean nothing in fact and most traders know it. They try to manipulate reader trying to convince him, that basic platform is an award winning super professional software which will make a real trader out of anybody without any effort. Instead of convincing everybody that your offer is good, try to make it really good indeed. Model and adapt your USPs. We see far better results with brokers who are aware of their strong and weak spots and they try to adapt USPs to some of customers’ expectations while being clear and honest about their shortcomings. E.g. “We know that are spreads are not among the best, but we can provide you with very fast execution and few other key advantages.”. Did this broker lost a client or won his trust? Reality proves the latter.
5. Chasing new customers only!? Many brokers focus on acquiring new customers, new accounts and new funds so much that they completely forget about existing ones. So new clients get cashback, bonuses, even extra funds with no deposit. Meanwhile, existing clients feel stupid or annoyed cause they already have an account. Strive to keep your existing clients. Let’s assume for a while, that your marketing plan expects the average client acquisition cost of $150 therefore, each existing client is worth around $150 that’s been spent and you won’t get it back when he leaves. Work hard to keep that money with you as long as possible. Brokers should rather try to make new clients want to become an existing ones and not the opposite.
6. Keep your customers happy with your service. Many complaints that brokers receive are pretty much controversial but brokers often stand in a position of the judge in their own case coming up with solutions that are in favor of their interest often mistaken with a short term gain. It is hard to find something worse for your image than treating a customer unfairly saving $20 or $50 or even $100 on a particular compliant. If he will feel treated unjustly then you will lose him risking that he may inform other traders within the community he is member of about your unfair verdict.
7. Do not fight with your clients. There are some brokers who engage social media and when flooded with controversial feedback they start to defend and fight. But rule no.1 says that customer’s always right, and if he’s not then rule no. 1 still applies. You cannot fight traders back and react with aggression or mocking to an unfavorable feedback. Keep in mind that you are building your image and you have a lot to lose here with barely anything to win.

“We need clients, clients and clients”

‘It is all about accounts’, as one broker said to me once.

Acquiring clients seems expensive and demanding process but it is just the first episode of the client-broker relation and shouldn’t be the last one. As general marketing study show, it is easier to keep a client than to find a new one. And all current clients were new clients somewhere in the past, however not all new clients will stay for long. Chasing only new accounts increases mainly rotation of customers between firms instead of bringing the actual value for them. On the other side of this universe are companies, that provide existing clients with service and benefits causing that many other people want to become their clients. No need to drag them in, just make them to come.

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