12
Tuesday
Jun. 2018

Marketing Alpha in an Ocean of Beta

There are thousands of marketing firms across this great land, and even more if you add of all the agencies across the pond. Specialist agencies that focus solely on financial services number in the dozens, if not breach one hundred.

Let’s get right to the point. There are a lot of them, but how many of these agencies really know financial services, and what makes that measurable?

If this complex, highly regulated business is such a challenge, why are there so many agencies playing in this space? The answer is summed up best by the familiar Willie Sutton quote: “I rob banks because that’s where the money is.” The key, however, for agencies, is to enhance their clients’ businesses by increasing new assets under management, clients or transactions; and to provide that service at a low cost of capital—not to rob them.

We view financial services as a place where asset managers, insurance companies, lawyers, accountants, investment bankers, brokers, banks, a slew of investor types, financial advisors, consultants, and fintech firms all inhabit complementary spaces, collaborating and competing as frenemies in a carefully orchestrated ecosystem. We have actually worked in many of these specialties, as opposed to those who merely “observe and service” the industry.

At financially-focused agencies, how many senior managers have managed billions of dollars, made multimillion dollar trades, developed products, have underwritten a company, designed ETFs and built and sold an asset manager and a fintech firm? If the answer is zero, you may want to re-evaluate.

What separates E5A from everyone else is our firsthand experience; we mean doing the work, the investing and the building of products. If you have ever surfed, you understand the power of a wave. Reading, interviewing or watching a movie about surfing can never replace the experience of having done it. There is no replicating experience in financial services either.

English, history and design majors are the staple of agencies. I know, I employ them, too. Let’s add in programmers, data scientists, media and people with non-traditional backgrounds and you may have a well-rounded general agency.

What is missing in too many situations are market participants: Portfolio Managers, people who have won finals, people who’ve pitched products to rooms full of advisors, people who’ve counseled companies through cap raises and people who’ve designed and launched new products. Them, and our systematic, data-driven process.

When adding these skills, experiences and processes to the senior management of an agency, the time to market is reduced and the probability of success is materially increased. It is a formula that you may come to describe as E5A.

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