Advisers' "sticky' notes

Advisers spend about five times as much to bring on a new client as they do to keep an existing one, creating a huge incentive to keep clients “sticky,” according to an adviser coach. Clients stick with an adviser if they have a deep personal relationship with them and feel like they are part of a community with other clients, said Dean Barber, founder of advisory firm Barber Financial Group and a coach to other advisers.

COMMUNICATION KEY

Surveys show that clients typically leave their adviser because of a lack of communication and a feeling as though the adviser doesn't understand their situation. “Many times, financial advisers are so busy trying to bring on new assets that they lose track of the importance of maintaining their current clients,” Mr. Barber said. Building deep relationships takes time, but certain actions can foster their development, including educational events such as seminars on tax strategies, entertaining activities such as wine tasting, consistent and frequent communications, and regular financial reviews that focus on holistic planning, Mr. Barber said. “We want to stay constantly in front of them — top-of-mind,” Mr. Barber said. “They know we're out there on top of the education scene, and that we appreciate them and what interests them.” Barber Financial Group hosts a minimum of eight educational events per month on topics such as the latest in estate planning or retirement preparation, as well as special presentations. It also hosts a quarterly conference call to discuss capital markets and how client money is being managed within that market context, Mr. Barber said. Barber Financial clients also receive weekly e-mails and other nonfinancial pieces, including recipes, he said. They also receive a quarterly newsletter covering “the four pillars” of wealth management: taxes, insurance, investments and estate planning. Clients are invited to participate in at least two fun events a month, such as August's tequila tasting. Mr. Barber said the firm charges for the fun events, but not the educational ones. Barber Financial even has its own travel club for clients, where it sets up trips to places such as Alaska. “The idea is building a sense of community,” Mr. Barber said. “Clients get to know each other and make new relationships.”