How a Billion-Dollar Firm Can Achieve 15-20% Annual Organic Growth: A Case Study with David Newson

Guest: David Newson, Founder at XNW Digital.

In a nutshell: Did you achieve your organic growth goals for 2024? If not, there’s a good chance that you’re not drawing some crucial distinctions between the tools that successful firms use to achieve consistent growth and the holistic strategies those tools should be in service of. Getting crystal clear on what those parts are and how they work together is essential to creating an actionable annual plan and executing on it.

On today’s show, David Newson and I break down how a hypothetical “billion-dollar firm” should gather its intel, identify its target client persona(s), and deploy various digital marketing experiments to achieve that singular organic growth goal, while also maintaining an ecosystem that’s in harmony with existing clients’ needs.

.David Newson and I discuss:

The differences between marketing tools and marketing strategies.
Tailoring marketing experiments towards ideal future clients.
How many different client personas a large firm can successfully target.
The cure for “We Work with Everyone!” Syndrome.
Basing your client experience in “magnetism and resonance.”
Translating marketing dollars into revenue.
Finding the right balance between SEO, AI, and human-created content.
Why David believes “your website is the center of your digital universe” and design principles your online home needs to incorporate.
Managing your firm’s brand versus the visibility of individual advisors.
Why advisors should think twice before making “fear” a key component of their marketing or branding.
How having strong opinions and “speaking the language” of your clients can attract the people you want to work with.

. Quotes:

David Newson on starting with your numbers and your target audience:

“We have to start with the numbers. Many times in marketing we talk too quickly about tactics before we even talk about strategy. And before we even talk about strategy, we actually need to understand what the numbers are. In this hypothetical scenario, if we’re talking about a billion-dollar RIA and we want to grow by 10%, then we want to grow that by $700,000 in revenue, or $1.4 million for a 20% growth rate. That’s a great place to start. And then I think the next place to start is, who is your target audience and who is the target audience who you desire to have as a client. I think many times we think about who the ideal client is or who the client has been in the past. We had this at Bingham, Osborn & Scarborough. A typical client at the firm when I arrived was much older, around $5 million in investable assets. And I had a mandate in marketing where we needed a different type of client — not a different type from a mindset standpoint, but we needed younger, wealthier clients. And then ‘How do we do that?’ was the big marketing question. How do we actually attract this new type of client that is younger and wealthier? And what does that actually mean? How do they move through the world? Are they tech engineers? Are they senior executives in SAS companies? We didn’t really know where they were. So my role as a marketer was, ‘Let’s back up. Let’s set up a series of experiments and figure out what that target audience is.’ So I think going to a 60,000-foot view of this is, if we want to grow by 10% or 20%, we need to understand who our ideal client is, who is our desirable client of the future, and then figure out everything that we can possibly learn about them. Marketing — or good marketing — is the pursuit of deeply understanding your target audience.”

David Newson on evolving your ideal client persona to meet your growth goals:

“That, to me, sounds like a messaging challenge. It’s not about, ‘We changed our stripes, and we’re a different firm because we choose to serve a new group of people.’ Why can’t a firm evolve and change and meet the consumer of the future where they are? Once upon a time, the existing client base was in a very different position when they became clients. And then they have aged with the firm. Let’s have that conversation with a client. Let’s talk to them. I would imagine clients want to be part of a firm that is going to be durable while they’re around and maybe for their children. I think what’s bad is if you just launch a new initiative, marketing-wise, a new target ideal client profile, and you don’t tell your existing client base about it. You need to bring them along for the ride.”

David Newson on the biggest marketing mistake firms are making:

“ I think perhaps the biggest missed opportunity or error that I have seen is tactics above strategy. Sometimes it’s hard to tell the difference. Video is not a strategy. It’s a tool and it’s a tactic. Digital is a tool and a tactic. It’s not a strategy. And if you are a marketer, you should be managing your portfolio of not just your marketing budget, you should also be allocating across various tactics. But it should all be in support of strategy. For this hypothetical firm here at a billion dollars and you want to grow 20%, you have a mandate now of growing by 20%. The big strategic pillar behind that is how are you going to achieve that 20%, what is your process for getting there? It’s not what tactics are going to get you there? It’s how are you going to think about getting there and figuring that out? And then also, how are you going to tweak that as you go if you’re not getting the results you need? And that’s where all the tactics come in. Coming out of the gate, we’re not going to do video because we don’t have enough people at the firm that are, one, willing, two, talented, or three, even have the inclination to be on video or go through video training. Maybe everybody shouldn’t have a podcast. I’ve also seen firms that do really well with the written word. That can be really powerful. But it can also be powerful for a marketer to look at that and say, ‘Wow, this person is creating this content over here in the written word, we also have someone over here who can actually produce in-person content,’ and string all of those things together. That’s all going to be in support of the strategy that drives the 20% goal.