Client retention — especially retaining your most affluent, profitable clients — hinges on successful communication.
The Challenge:
The past four weeks have been focused on creating a communication plan focused on top clients, the ones a practice can’t afford to lose, and acquiring referrals from them.
The key to a successful practice, especially in the challenging markets we are facing today, hinges on a commitment to a successful communication plan and aligning the resources to execute it.
And this communication should come from a senior partner. This means leveraging outside resources to help with marketing, operations and daily administration.
The challenge is how to make this work.
The Solution:
The questions I often ask the team are, “How would it impact your business if you lost 30% of your top clients?” and “How would it impact your practice if you could increase assets by 10%-20% from your top clients?” The answer to both questions is in the communication plan.
Here are three success stories from advisers who have put a plan in place and outsourced responsibilities they have traditionally taken on themselves. Each successful adviser shares how they have taken their practice to the next level by implementing one of the strategies we have covered over the past few weeks.
Committing to a Communication Plan
One advisory practice we have worked with has realigned its client database and team responsibilities to focus on the top 20% of their clients, who represent 80% of the practice’s revenue.
The first step they put in place is to have two face-to-face reviews with their best clients. The practice had traditionally held year-end reviews to finalize any investment or financial planning needs. Now, they are in the process of holding their first post-tax-time reviews. They are using this opportunity to talk with clients about their overall plans, to review statements (as painful as it may be) and tax returns, and to put a plan in place to move forward. The team has found they are locking in their best clients, even though some of them had been considering changing practices. Also, they have automated two referrals from each client by using The Connected Advisor referral strategy and scripting. The result is a jump-start to the second half of 2009.
Streamlining Client Communications
Our article on
April 20 covered a few strategies to streamline and focus communication. We had one comment regarding compliance and I want to emphasize in this article to always check with your compliance department before sending out a communication or setting up a website. It may make sense to let your clients establish their own sites and not have it linked to your practice. It depends on the controls you put in place to manage and filter the information flow on the site. One RIA team is using a communication site very successfully and the key has been that they control the information.
One team brought on an intern to update their client database, including addresses, e-mails and phone numbers. The focus has been on top clients first and they are using the TCA top clients’ chart to gather other critical information for their files. The more you know about top clients and their interests, the more focused your communication can be. The timeline for completion of the database update is three weeks, and the intern is calling the top 60 clients and prospects and e-mailing the rest. The other responsibility of the intern will be to automate the systems used to run client seminars and events.
Create several e-mail templates for client communications and have them approved by your compliance department before sending them out. We suggest a quarterly newsletter, inviting clients to reviews and a meeting for the follow-up reviews. The follow-up is inevitably where plans fall short. Make your quarterly communications a turnkey package by attaching an investor-approved PDF newsletter or white paper from your firm or a wholesaling team to the e-mail template and sending it out the first business day of each quarter.
Outsourcing marketing and operations
Review how your team is spending time on the areas that have been hit hardest due to any downsizing in your firm or team. This is an opportunity to leverage operations and marketing, and maybe even find a consultant to serve as chief investment officer. One team we are working with to realign their marketing strategy for asset retention and referrals works closely with an outside operations consultant. The benefit has been that they have someone driving and questioning their business plan who brings best practices and helps define roles and responsibilities.
How would it affect your practice if you had 30% more time each week to spend with clients? That is the result of focused and successful outsourcing.
TAKE ACTION
Set a goal to improve just one area of your practice over the next week and track the success. One degree of change can take your practice to the next level.
Next week: Summer client events that generate referrals
