December 2015: Marketing Promotions and Collateral in Review

This month’s Broker Monitor Report reviews the current promotional landscape across our Broker Monitor coverage set. We list the promotional incentives currently offered by Broker Monitor firms, noting any changes or new offers introduced during 2015 as reported in our e-Monitor Updates. We provide examples of hardcopy and email marketing collateral received over the past year. While we may only provide snapshots of marketing collateral within the Detailed Findings below, the full range of collateral received for the year is accessible on our client site.

This report focuses on the promotional offers targeting mass affluent/retail investors and does not review incentives offered to high net-worth clients as these programs can vary greatly based on the needs of the client. As such, many of the promotional incentives reviewed are offered by the self-directed firms in our coverage set and feature prominently in the Summary Findings and Detailed Findings sections of the report. Firms that do not currently offer incentive programs or examples of promotional collateral were not reviewed for this report.

Providing free trades for new accounts is one of the most common incentives programs offered in the industry, with 80% of self-directed brokerages in Broker Monitor offering free trade incentives to encourage prospective clients to open a new account. Every firm, except for one, that offers free trades requires clients make an initial opening deposit between $2,500 and $50,000. Cashback rewards are also a frequent incentive, offered by 70% of the self-directed firms in the report. All firms, save for one, that run a cashback rewards program offer different tiers for rewards based on the amount deposited into a new or existing account. In terms of marketing collateral, this year several full service firms sent promotions for their in-house credit cards. These firms sought to entice clients by offering initial bonuses to new cardholders.

Additional key findings include:

  • Two firms offered reduced fee waivers for their managed advisory services
  • $2,500 was the largest cashback reward amount available to clients, offered by two firms in the coverage group