That One Weird Trick

David Eckerly, Personal Capital

What does Personal Capital do?

Our company mission is to transform financial lives through technology and people. That boils down to two key offerings:

1). Free online tools available to anyone. These tools can be used to plan for retirement, see how your investments are performing, find hidden fees, or get an overview of your spending and savings trends. This analysis is done across all your financial accounts - which means you have a 360-degree view of your money in a single dashboard. For most people, it’s the first time they’ve ever seen all their accounts in one place.

2). Personalized advice from an advisor. This is a premium service for those who want help with their financial plan or investing strategy. Our advisors see the same consolidated view as our clients, which means we can offer holistic advice based on someone’s overall situation. That’s much different from a traditional advisor who makes recommendations based on just a few broad inputs like age and expected retirement.

What might be different about marketing financial advisory services vs. other types of services?

Consumer investment advice has really split into main factions in the last decade. The first is the group I mentioned before – traditional advisors. These are human advisors who tend to market benefits like personal touch, white glove service, and local presence. The second group is the robo-advisors. They sprung up to combat the deficiencies of the traditional model, namely high fees and accessibility. The robos are cheap, available to anyone with a smartphone, and engineered for extreme ease.

Both models have their place, but they also leave a giant hole in the middle. There’s a huge group of investors who want powerful online tools, real-time advice at any time, and they don’t want to pay too much. However, they also want a real person to talk to about the more complicated aspects of their financial life. Things like estate planning, tax optimization, education saving, and risk management aren’t well handled by algorithms, and aren’t likely to be any time soon.

That’s where we come in – great tools, along with human advisors, at a reasonable cost.

Given that Personal Capital is a freemium service, is marketing more focused on growing the free tier population or converting users from free tier to paid tier? What are you specifically focused on?

There’s no real way to separate those two. It’s a bit like asking, “Is a farmer more concerned with growing crops, or with selling those crops?” If you don’t grow crops, you have nothing to sell. If you don’t sell any crops, you can’t keep your farm running.

We want both. Lots more free users, lots more clients. In many freemium models, the free users are just a cost with no corresponding revenue. For us, the benefits of a free user outweigh those costs. Word-of-mouth referrals, social media mentions, app store reviews, and overall brand expansion are good examples. The marginal cost of letting those people use our platform for free creates more value for us than would a corresponding spend of the same amount on advertising.

It’s also true that we regularly convert users who have been with us for two, three, five, even 10 years. Their financial life was relatively uncomplicated when they first registered for our dashboard, but once they’re a bit older and life has gotten more complex, they need help. So, we’re happy to have people at whatever stage they’re in.

How does your work contribute to building trust with users, in order to persuade them to use Personal Capital’s wealth tracking tools?

When you’re talking about financial data online, the first and biggest priority is security. That’s a huge topic on its own and delves more into the technical realm than this audience probably cares for.

But setting that aside, there are two other key considerations. The first is ease. Users don’t want to take time to learn a bunch of complicated software. They’re tech savvy, to be sure, but they’re also busy. If they can’t login and immediately tell what’s going on within the first minute, they’re not going to keep coming back. Second, is what we’re showing them unique? Simply displaying another version of what they already have at Schwab or Fidelity isn’t particularly interesting or useful.

Part of my job is to demonstrate the ease and uniqueness of our tools to our users. Within the product, that means creating an experience that makes these tools easy to access and understand, along with insights they can’t get anywhere else. Outside the product through channels like email or push notifications, it means continually educating users about the tools available to them, as well as offering personalized suggestions about how to improve their financial situation.

How does personalization give Personal Capital a marketing edge in meeting customer needs? Give one example of how this is done via outbound marketing or in the product experience.

At the risk of stating the obvious, personalization is about making your communications all about the user. And I’m not talking about using a person’s first name, trying to build rapport over where they went to university, or wishing them a happy birthday. Those are all well and good, but it’s not anything a million others aren’t already doing. Much better is a solution to a problem or opportunity they might not even know they have.

A good example is a campaign we recently did around recurring contributions. We know that people who routinely add money to their portfolios in small chunks save more than those who don’t. It’s simply easier to save a little each month than it is to come up with a big sum at the end of the year. So how to encourage people to automate this action?

A standard framing might be something along the lines of, “If you save $500 more each month, you’ll have an extra $250,000 by the time you retire.” That’s not a bad approach, and it’s certainly benefit-oriented, but it’s not terribly personal.

Since we have user data on spending and income, we can take that message one step further. “Did you know that last year your excess monthly cash flow was $1,500 per month? If you invest just $500 of that each month, then you’ll have an extra $250,000 by the time you retire.”

This second version is significantly more powerful because it makes the opportunity tangible. In the first case, the user has to expend mental energy. Is $500 a month a lot? Can I afford that? Most won’t bother. In the second case, we’ve made the path forward less daunting because we’ve framed the full scope of the situation for them. It’s been a big success for us and is one example of how the right personalization, even minor, can go a long way.

What is your favorite marketing channel or platform, and why? E.g. out-of-home, search, TV, email, etc.

In-product, no question. We’ve got a great dashboard with a ton of amazing tools. There’s just so much more we can do once a user is logged in versus other channels. Plus, we know that when they’re logged in, they’re thinking about their finances and are in the right mindset to engage on those topics.

Email is another great channel for us, but I’m fully cognizant that when someone is reading one of our emails, they’re probably doing so on a smartphone while in between Zoom calls, caring for a child, feeding the dog, watching Netflix, folding laundry, eating dinner, or standing in line at the pharmacy. It’s usually not the time or place to delve into the more complicated aspects of finance, which is already a tough subject for most people.

What’s the largest single marketing initiative (spend, audience-size, etc.) you’ve participated in and what lessons did you learn from it?

The biggest I’ve been part of at Personal Capital was our 2019 rebrand. At that point we had been operating for nearly eight years with no significant changes to brand positioning. As a Silicon Valley startup, we had primarily appealed to a specific type of person – younger, tech savvy, early adopter, skeptical of Wall Street, high appetite for data interactivity and detailed analytics.

Early in 2019 we hired a new CMO, and she astutely recognized we were underselling our strengths. As our tools and capabilities had evolved over time, we were no longer just for software engineers and data geeks – we had a compelling offer for a wide range of investors, and it went way beyond a cool dashboard with fun analytics. But when you looked through our website or at our marketing materials, that certainly wasn’t apparent.

Skip ahead to a major pivot in terms of how we represent our brand, and the last two years have been a smashing success. Lead flow, conversion, brand awareness, brand trust, net promoter scores…you name it, it has gone up. The details of that pivot could be their own extended interview, so I’ll save that for another day. But there were two clear lessons that get at your question.

The first is that you need to do a periodic capabilities assessment and compare that to what you’re selling. Businesses change over time. They get better at some things, worse at others. They introduce new services, discontinue others. They open up new markets, and they exit saturated ones. If your positioning doesn’t evolve with those changes, you end up with a mismatch between what you do, what you’re selling, and who you’re selling to.

The second lesson, unsurprisingly, is that these changes are difficult. I have tremendous admiration for our CMO for pulling our organization, almost single-handedly, into the present through her efforts. When you have a successful business, it’s hard to snap people out of the “this is how we’ve always done things” mindset. It takes a lot of meetings, a lot of persuasion, a lot of data, and a lot of negotiation. And even then you’re not sure it’s going to work, so it takes nerves of steel to see it through. She did all those things and proved that if you have the right vision, and you can get people there, the upside is huge.

What accomplishment are you most proud of in your career so far?

I’ve never had an easy time with this question. There is the standard “job interview” way to do it – here was this campaign, here was the KPI, here’s what we did, here were the results. And I have a lot of those examples over my career, but are those really my proudest moments? Not really.

As a person now more than halfway through his working career, I’m most proud of having spent the last two decades working at companies striving to upend financial services for the benefit of the individual investor. There are a lot of honest, intelligent, hardworking people in the advisory space. There are also a lot of snakes who are out to rip people off and enrich themselves. For someone who doesn’t know much about investing – which is most people – it’s hard to tell the difference between the two.

What’s gratifying for me is the clear difference between where the industry was when I started, and where it is now. My last company was a small speck when I got there. They’re now managing more than $100 billion and arguably the largest independent RIA in the country. Personal Capital has quadrupled assets under management since I’ve been here, and we now have brand trust measures that are as high or higher than major industry players. In the coming decade, I believe the strength of our model will force others to follow our lead, and that can’t be anything other than good for investors everywhere.

Am I responsible for those accomplishments? Surely not. But I am beyond proud to have been involved in even a small way, and when my career is over, those will be the things I remember.

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