Turning prospects into happy, satisfied clients has not always been easy for me. When I first started in the industry, my closing ratio was an abysmal 20% to 30%. In fact, it was so bad I had to take a salaried job as legal counsel to a mutual fund board, just to make ends meet.
Fast forward to today. It still amazes me that getting and keeping beloved clients is now the easy part of this business. Here are some of the steps we took to go from 20% of our prospects engaging us and following our advice, to over 90%:
1. We found a great niche that worked for us. If you have been reading these articles, you know that I started working with professors at Brown University and have since expanded the practice from there. All of our clients have doctoral degrees. Young professors, with lots of needs and no other financial advisors, turned out to be a good fit for us. They like that I have a degrees after my name and we can relate to each other.
2. We approach all of our client interactions from an educational perspective. I frequently will tell our clients: “You are very smart. My job is to show you the pros and cons of your options. Once you have good information, you can make good decisions for yourself.” Professors really like this approach, and it also shows them that they are in control, so it reduces a lot of the pressure.
3. We are exceedingly patient. One thing I discovered about professors is they need a lot more information than most clients before they can make a decision. More than once, I have had 12 meetings with a client before they pulled the trigger on anything! Many advisors would have given up at meeting two or three.
4. We design the entire sales process (which I call the WOW client experience) for the decision style of the client. The important lesson here is to target your client experience to your ideal client. Once in a while we will work with a business owner. This group likes to make decisions quickly and move on. Most business owners don't need a lot of information or meetings to move ahead. They are the opposite of a research-loving professor. For business owners, we cut to the chase, use bullets and then only go in depth if they need more information.
5. We tailor the solution to the client. Six months into my great experiment, I noticed that about 95% of our clients really liked a particular product. It addressed their desire to reduce taxes in the future and had some downside protection. It also had good after-tax returns. It was the 5% who didn't like it that really troubled me.
I looked at the few cases who turned this product down and noticed a similar theme. Some were older, some younger. Some married. Some single, but all of them had trouble saving money. In fact, they were in debt, and living very hand to mouth. When I noticed that, it became clear to me, the clients recognized something that initially escaped me: The product would have been a very bad choice for them, because they would have had to commit to an inflexible funding level for many years. It simply was not something they could do in their current circumstances. Each client had made the right short term decision: decline this opportunity and focus on something that was both more liquid and more flexible.
Now, I never recommend this product to a client who can't save. There is no point. We select a solution that has more flexibility, more liquidity and a better chance of success. Result: more yeses, more often.
6. We are tenacious about setting up first meetings. Once someone joins us for one of our educational briefings and indicates that they would like to meet with us, we just keep reaching out until we can finally connect. We have one client who took us two years to get on the books and another who took nine months. One of my rules is we don't say “no” until the prospect says “no.” The only time I take them off of our call-back list is if they ask to be removed.
7. We provide services that other advisors don't. We opted for the concierge-level practice early on. Yes, this does take a lot more time on our side, and it does require a bigger staff, but the results have been well worth the investment.
One of the many things we do for our clients is create an individual debt plan. Many professors finish their training owing hundreds of thousands in school loans. They have no concept of what this will actually cost them when they finish training and have to start paying these loans back.
We saw this as an opportunity to serve our clients in ways other advisors weren't. We hired a leading national expert on student loan forgiveness programs to educate us on the ins and outs of using the public service student loan forgiveness program. This was an expensive call for us, because her information did not come cheap. However, we have been able to use it to help dozens of clients shave tens of thousands to hundreds of thousands off of their student loans without any tax liability. Not only is this a great service for them, it is yet another reason why they want to stick with us and not work with a more traditional financial advisor.
8. We don't take a deposit on our financial planning fees. Many advisors ask for half of the financial planning fee up front before they complete the work. I realized that most of our clients can't gauge the impact of a financial plan on their lives by just looking at a sample. The plan needs to be personal and fix the specific pain points of each client. So we don't ask for the fee until we have had a couple of meetings and I am sure they are happy with our work.
9. We are constantly analyzing the sales process and tweaking it for improvements. We think of this as “manufacturing.” We must be as efficient as possible. This is much different from my 20% years when everything was a “one off.” Today we have a dedicated process and stick to it. That way it is easy for me to see what is working and what's not.
A year ago I noticed that I was having to redo a lot of the plan presentation meetings because the team had made mistakes inputting the data into the software. This was extra work for the team and at least three to four extra hours for me.
My solution: We added a short meeting with the team between the first and second meeting with me. The team uses this time to get to know the clients and confirm that we have all the information we need to only present the plan once. My team really pushed back on this, but in the end they saw that this does save them a lot of time and makes the on-boarding process go more smoothly
10. My attitude changed. When I first started as an advisor, I had three young kids to feed. I was much more anxious about securing clients and I think clients could read that desperation. Today I am in a different place. I am more concerned about quality clients than quantity. I am also totally at peace with the few who decide not to work with us.
I took on a few clients who were red flags from the very beginning. They were wildly emotional, not always rational and very difficult to please. I secretly suspected they were medicating themselves.
Today, I would just decline to take them on and not put myself and the team through the pain of the difficult client. The sense of peace I have is extremely important because clients can subconsciously pick up anxiety or distress. It becomes a warning signal to a potential client and they are not likely to move ahead. The “vibrations” just don't feel right to them.
I don't live or die by any one client. I always try to learn from the experience, but in the end, as I am considering taking on a new client I always ask myself these questions: Would I invite this couple to my house for a barbecue? If they pass that screen, then I want to know is this the kind of person I would want in my life for the rest of their lives and the rest of mine?
Ultimately, I don't feel like we have been successful unless we get invited to weddings, graduations and funerals.
One final word: I really hate the terms, “closing the sale” or “sales process” because I don't think of myself as a sales person. I think I am a dedicated, educated problem solver who always makes decisions that are in the clients’ best interest. I just use those terms here because it is common in the industry.
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