Five Strategies To Guarantee Investment And Insurance Success

Here are five strategies that enable advisors to capitalize on our changing business environment and fully leverage the valuable help now available from institutions.

These strategies will help you find niches where you can succeed, help you respond with flexibility to new developments and help you fend off competition.

Most important of all, they will help you offer your clients the world-class service they deserve, while increasing the profitability of your practice.

Strategy 1: Focus on Affluent Private Clients.

A large majority of advisors are interested in attracting wealthy clients. With this huge interest in working with the affluent from so many advisors, how do you successfully compete? The answer is to develop–systematically and purposefully–a steady stream of new pre-qualified, pre-endorsed prospects that seek you out and want to work with you. In effect, youll build a marketing machine for attracting the affluent. A five-step strategy has been proven time and again to accomplish exactly this.

1. Create a compelling vision of success. Take the time to paint a detailed mental picture of what youd like your business and life to look like in five years.

This vision must be something that youre excited about because your emotional commitment to it will be the force that turns your dream into reality. It should be the motivating force behind your overall business plan, the inspiration for members of your team and the crux of the financial model of your business.

2. Develop a target market. Narrow your focus and specialize in one or more target markets. Learn your groups unique needs and how to meet those needs effectively, positioning yourself as an expert in your clients minds in the process.

Elite financial advisors target markets that have plenty of money in transition, such as from IRA rollovers, divorces, inheritances, settlements or saleable assets such as businesses. Pooling capital from small, targeted groups of clients enables you to leverage your time effectively, focusing only on those activities that have the highest payout. It also makes it much easier to get referrals because you understand the deep and narrow issues that affect your target group. You will become known inside this community as the expert that really understands their issues–because you will.

3. Discover niche opportunities. A niche opportunity is simply a market thats particularly suited to your unique talents, skills, interests and disposition. By matching your own skills and interests with those of your niche group, youll have the high quality of life you can get only from working with a group of people with whom you have a great deal of affinity.

Niche opportunities are everywhere, but youll need to do some research to find the ones that are right for you. It is extremely effective to interview key clients, centers of influence, local experts and industry leaders to identify new niches.

4. Position yourself as an expert. Create an image that says youre the best financial advisor for your niche group in your area. But, image isnt everything–you must be a technical expert on financial services for this group in order to gain the credibility you need. And then you must let your expertise be known. One way to communicate your expertise is to write articles for appropriate trade publications. You can exhibit at their trade shows and get deeply involved in their community. People will always do business with a person they know and like, as opposed to somebody they meet through a cold call.

5. Communicate your benefits cost-effectively. Once youve identified your target and niche markets and begun positioning yourself as the expert to meet the needs of this group, youll be ready to communicate the benefits you offer to your prospects. Your goal is to communicate that you have solutions to the particular problems of your target market.

The best way to communicate with the affluent is through one-on-one interactions that you generate through referrals or strategic alliances. You have to develop a systematic process of building relationships with your future clients.

Strategy 2: Use the Investment Consulting Process.

Most financial advisors are trained to sell financial products rather than a consultative service. To deliver services successfully in a consultative manner to an affluent clientele, however, you first must have a clear idea of the types of services these wealthy clients actually want. Studies have shown that the most desired service by the affluent is assistance with asset allocation. This is followed by financial and estate planning, with tax planning a distant third.

Fortunately, there is a process that will place all the work you do with your clients within a consultative framework and that highly lends itself to delivering very effective asset allocation services. It will also support financial and estate planning and tax planning to the extent that you can offer these services (see sidebar on page 17).

The investment consulting process enables you to deliver consistently a high-quality client experience that will clearly differentiate your practice from your competition. It is based on a series of scheduled meetings designed to foster trust and delight your clients from the very first meeting.

Strategy 3: Manage Your Practice as a Business.

Set aside time to develop a focused, strategic plan for your business that clearly defines long- and short-term goals and spells out exactly the actions that must be taken and the processes that must be implemented in order to achieve these goals. This plan will focus your activities and greatly enhance your chances for substantial success.

One important component of such a plan is a process for ensuring a high and consistent level of client service. Successful advisory businesses deliver a great experience to their clients at every contact, which is precisely what affluent clients demand. If your advisory practice lacks a systematic focus in your delivery of service, it is impossible to meet the high expectations of wealthy clients or to respond effectively during difficult markets.

There are six key elements to a strategy that ensures that you provide unsurpassed service to your clients at every point of contact.

1. Evaluate your service from your clients perspective. Successful advisors look at how well their service meets the expectations of their clients and are careful to evaluate it from their clients point of view. They keep at the forefront of their business practices the single thing clients most want: a trusted advisor who can simplify their financial lives.

2. Offer clients the appropriate number of choices. Research has shown that the more services provided by the advisor, the more satisfied the clients. In addition, these highly satisfied clients have been shown to provide significantly more referrals. Your challenge is to get the right information about the specific services your clients actually want and to apply that information intelligently.

3. Create a modular production system. Build your services in discrete modules that can be added or rearranged as needed. Your investment consulting process should use a customized template for easy replication. Document every major process so that each member of your firm can easily access and understand it.

4. Provide fingertip access to all information. Everyone in your firm should be able to access relevant information about your client base, as well as each individual component of your work process, at any time. Put all portfolio management software, client files and contact information online so that it can easily be obtained by appropriate internal users and outsourced providers.

5. Establish a direct link with clients. When clients utilize custom services, the company finds out much more about clients preferences than it could ever learn through traditional market research. Create a feedback loop to capture that information.

6. Make it difficult for clients to leave. Beyond giving clients service choices, successful advisors can create a client interface thats addicting. If you provide a service that succeeds in your clients eyes and these clients use your service repeatedly, their investment in your firms process can create loyalty and increase your market share through referrals.

Strategy 4: Partner Effectively with Institutions.

Providing the number and kinds of services affluent clients expect requires you to outsource many services, especially those that are not part of your core expertise. This means that the partners you choose may be the single most important factor in your success.

Fortunately, the timing could not be better for financial advisors looking to partner with institutions. As financial products and services become ever more commoditized, financial institutions will be under increasing pressure to add value beyond their core offerings in order to win advisor loyalty.

Strategy 5: Commit to Ongoing Learning.

Theres no doubt that keeping up with ever-changing laws and regulations, new technologies and innovative investment products and strategies is a substantial challenge for advisors. But to provide the level of service that your clients need and expect, you must make it one of your priorities.

There are three steps to a lifelong learning program that can help you reach and remain at the elite level.

1. Develop an advisory board. Almost all advisors agree that it is important to have a support network of peers.

2. Use mentors, coaches, and consultants. Elite financial advisors are aware of the need to identify a mentor, coach or consultant to help them achieve all they are capable of achieving, much as an elite athlete has a coach to assist in accomplishing new goals.

3. Invest in training. Elite financial advisors recognize that their competitors invest significantly in education and that they must receive this same level of training to remain competitive.

Its clear that the great majority of all advisors recognize that they face significant obstacles in obtaining the education they need to grow their businesses. However, the elite advisors develop a strategy for overcoming those obstacles. A key element of their strategy is developing a formal education program that keeps them abreast of changes in the industry. They take an active role in continuing their education, not a haphazard passive approach.

The challenges facing advisors of every type both today and down the road are significant. To face these challenges and simply remain in business is one thing. But meeting these challenges and reaching new and higher levels of success is something else, requiring that you master each of the five essential strategies of success.

John J. Bowen Jr. is the founder and CEO of CEG Worldwide, San Martin, Calif. He may be reached at jbowen@cegworldwide.com. This is an abridged version of a presentation he gave at the MDRT meeting in Las Vegas.


Reproduced from National Underwriter Life & Health/Financial Services Edition, June 30, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.