<< Back to resources

Key Organic Growth Themes from the Spring Conference Season

Written by: Wilbur Swan, CEO & Co-founder, Catchlight

Spring '24 was a whirlwind of conferences for investment advisors. I thought I'd share what I heard on the topic of "Organic Growth" and add that we are doing research on all of the data points below.

Summary: the need for organic growth was THE focal topic this spring, with a convincing case presented from multiple industry experts that, "organic growth is truth" or as Warren Buffett said "only when the tide goes out do you discover who's been swimming naked."

1) The S&P 500 averaged returns of 15% /yr from 2012-2021, vs a 50 historical average 7%. Firms, believing that is unlikely to repeat, are focused on a "return to basics" to drive organic growth. Alarmingly, absent market growth, 70% of firms would have seen negative growth.

2) Compounding that need are increasing headwinds to share of wallet growth, where baby boomers have now reached peak retirement and are drawing down accounts and transitioning wealth.

3) Where will the $84 trillion that is predicted to change hands from the baby boomers in the next 20 years end up?  GenX (age 43-58) appears to be best positioned as the next big segment, with a projected 40% of all wealth by 2045, or >2x what is currently in Baby Boomer accounts.

4) Trying to win clients who already have an advisor is an uphill battle. Many suggested targeting those growing into the need and into the mass affluent segment. Pro tip: unlike the Boomers, the next generation (<45) is more likely to use online search, ads and social media to find their financial advisor.

Spring Conference Round Up Featured Image

5) Which tier to focus on? The mass affluent segment (36 million households) now has total wealth on par with that of the HNW and UHNW segments (2 million households), roughly $20 trillion each.

6) 25% of firms have increased their digital marketing spend more than 10% 2023 vs. 2022, and yet, the median across firms is <1% marketing spend to revenues, vs. overall financial services spend on marketing of 7.5%.

7) Client Acquisition Costs (CAC) range from $7-$15k for digital marketing, to $20-30k for lead generation programs.

8) Firms discussed how they are tackling the challenge, ranging simple first steps to very sophisticated, multi-channel marketing and lead gen programs, lead scoring, routing and engagement strategies. The "growth playbook" is emerging.

With so much at stake, Catchlight is inspired to partner with, and help firms:

  • Improve the conversion on all organic growth programs, reducing the CAC and accelerating revenue growth. Our mission: to enable faster, more systematic and predictable growth.
  • Optimize the routing of leads where time and accuracy matter, such as Lead Gen and Custodial Referral programs.
  • Identify the highest potential Next Gen prospect and personalize their outreach, to build for the future.

    -Wilbur Swan, CEO & Co-founder, Catchlight