Fidelity Investments is encouraging advisers to deploy undercover “mystery shoppers” to help firms learn more about their business development shortcomings.
The Boston-based company said one financial adviser used this approach to discover clients were turned off by their firm's automated phone system; another learned they weren't including the right employees in the sales process.
Five firms took part in a pilot of the program that will be rolled out Tuesday to advisers who custody assets with Fidelity Clearing & Custody Solutions.
“A mystery shopper can help firms get a taste of the experience they're giving prospects,” said David Canter, executive vice president for practice management and consulting for the Fidelity unit. “It's critical for firms to have a good grasp of how prospects feel about them from the first click on their websites or first steps into their offices.”
Advisory firms face higher competition and costs as increased regulations have boosted compliance responsibilities for registered investment advisers. Many advisers have refocused their marketing and branding efforts on what they offer clients compared to others firms.
(More: Advisory firms are missing their growth targets for assets)
Advisers interested in hiring mystery shoppers will collaborate with one of two market research firms that will send someone into an office posing as a prospect who meets their client criteria. The individual will interact with the firm and report back on their positive and negative experiences.
It's usually about a two-month process and costs around $10,000 with the discount Fidelity has arranged, Mr. Canter said.
Brighton Jones, one of the five firms to test out the Fidelity program, worked with the researchers to create a faux prospect who would challenge its business development team to think creatively, said Tyler Mayfield, chief operating officer of Brighton Jones.
The firm received “incredible feedback” that led it to improve the way its initial conversations go with prospects, he said. For instance, the firm came up with some ice-breaker questions that are now used with prospects who call to investigate the firm's services.
RMB Capital, another firm that was part of the pilot, heard from an undercover caller that one of its business development professionals wasn't coming across as genuine over the phone.
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“We went back to that person, who didn't realize that's the way he was coming off, and discussed a better approach that reinforces our values,” said Fred Paulman, president of RMB Capital.
Getting this kind of an outsider perspective can be a great tool to evaluate which business development approaches work with different types of clients, Fidelity said
in a white paper on the topic.
If a firm has lost several good prospects to a competitor or believes its close rate should be higher, it may want to consider this new approach to business intelligence, the custodian said in the report.
A Fidelity RIA benchmarking survey found only about one in five firms have done any type of client satisfaction research during the past three years. Even fewer take a look at the perception prospects have of their firms during the sales cycle, Mr. Canter said.
