From the September 2007 issue of Boomer Market Advisor • Subscribe!

September 1, 2007

The secret to low client acquisition costs

How do I get if front of 25 to 35 qualified prospects at a time? How can I lower my total cost of client acquisition? How can I double my personal production? The answers are all the same -- master worksite seminars.

Traditionally, cost has been the largest obstacle to successful seminar marketing. Historical costs include location fees, printing, postage, mailing, food, workbooks and the seminar system itself.

All of this can add up to $5,000 to $10,000 per seminar. In simple terms, considering an average conversion cost-per-client ratio, the per client acquisition cost may be as high as $750. This can be rationalized given high potential fees and/or commissions. But there is a better way.

My practice did well over 100 seminars in 2006, with approximately 2,800 qualified participants. I focused the growth of my seminar program on the corporate space with worksite seminars. My average class size had 28 participants with a total cost of $250 per seminar. My per client acquisition cost is $17.85. That is a savings of $732.15 per client. Sounds good, but were do you begin?

Step 1 -- Marketing the right message

Most advisors market to corporations as the "advisor." They promise to provide educational seminars and offer the best service to the corporate employees who become clients. This is the absolute wrong message. Corporations have a "What's in it for me?" mentality. The HR and benefit directors want you to make their jobs easier while lowering their exposure. They want to increase plan participation, increase employee productivity, increase employee retention, all while complying with 404(c) regulations.

The right message instead is:

"Educated employees will make informed, rational decisions. Exploring the affects of financial education as a benefit for your employees will help you discover the positive influence this type of education will have within your organization. The benefits to your organization will include increased employee education, participation and productivity."

Follow this with an understanding of the 404(c) educational requirements outlined for employer sponsors of retirement plans.

Step 2 -- Qualify the corporation

Once you have refined your message, market it to qualified corporations. Qualifying publicly traded companies is important because the employees have multiple ways to create wealth (stock options, stock purchase plans, etc). Make sure the corporations stock is in the money, work on companies which are head quartered in your city and get the contact information for the HR Director.

Step 3 - The process

You must have a well defined process when contacting HR departments. The following protocol works. If you reinvent the wheel you will have a higher probability of failure. I developed my own system, NationBuilder by iNation, for client management. Whichever system you use, follow the same process:

1. Send a letter of introduction to the HR director.

2. After five days, call the HR director, confirm receipt and answer any questions.

3. On the same day you make the first call, send a packet of information. This may include the presenter biography, a sample seminar, list of corporate seminar sponsors and your "message."

4. After and additional five days have passed, call the HR director to confirm receipt and set the appointment to discuss how you can be of service.

5. If you reach voice mail, call every third day and leave pleasant messages until you get the appointment. Persistence wins. Do not stop calling until they tell you to stop.

This process may take as long as eight months before you have your first meeting. Generally speaking, if your message is consistent you will get the appointment.

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