Spectrem asked investors to look at photos of advisors and choose one.
New investors need to find financial advisors for assistance, and established investors occasionally look for a new voice to listen to in regard to investment decisions. A financial windfall, or a financial complication, can lead affluent investors to search for a financial advisor.
The search for a new advisor has to start somewhere, and often it starts with a website or advertising photo. For some advisors, that is a good thing. For others, not so much.
According to Spectrem’s white paper Snap Judgments: Do First Visual Impressions Impact Financial Advisor Selection?, first impressions matter, and occasionally, that first impression comes from a photograph on a website or other form of advertising. In those occasions, the advisor who happens to be an older white male has an advantage over female advisors, young advisors or advisors of color.
To determine the effectiveness and selectivity of first impression photographs, we showed high net worth investors a group photo of eight adults, each representing a different combination of race, gender and age. Without receiving any other information about each person, investors were asked to state which person they would be most likely to select as their financial advisor.
Overall, the older white male was selected by 33 percent of advisors, by far the most popular choice. The “white male’’ component remained popular as 23 percent selected a middle-aged white male, almost doubling the selections for the older white female, who received 12 percent of the selections.
That puts the group of advisors who are white males and not perceivably young at 56 percent of the investors.
The white female advisors, of which there were three in the photo, were selected by 37 percent of the investors, with almost no significant gap between older, middle-aged and young (12-13 percent each).
Receiving less than 10 percent of the selections were the young white male (4 percent), the middle-aged minority male (2 percent) and the younger minority female (2 percent). The two minority advisors were both black.
This is data based on first impressions. Face-to-face meetings can alter those perceptions, and with an increasingly diverse population of investors, there may be a change eventually in how advisors are perceived base on race, age and gender.
The white paper notes that not only does the age, gender and race of the potential advisor matter, the age, gender and race of the investor can change the selection of an advisor based solely on a photograph.
Among investors under the age of 35, the middle-aged white male was selected by 31 percent, the older white male by 24 percent and the young white female by 21 percent. As age increased, the popularity of the older white male increased, while the popularity of the middle-aged white male and the young white female decreased.
Based on gender, 39 percent of males selected the older white male, but only 30 percent of the females did so. The female investors were far more likely to select the older white female (14 percent to 5 percent of males), but that is the only category in which there was a disparity between investors based on gender.
The population of investors is going to change as the population of America changes in terms of race, gender and age. Research has found that African-American and Hispanic investors are interested in having the option of working with an advisor of the same ethnicity, women more often enjoy working with women, and young investors can be put off by an investor two generations removed from them.
Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.
In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.
McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.
McDill is the father of four children, and an active fan of soccer, Jimmy Buffett and all things Disney.