One of the defining characteristics of successful businesspeople is the habit of seeing challenges as opportunities. “It’s through curiosity and looking at opportunities in new ways that we’ve always mapped our path at Dell. There’s always an opportunity to make a difference,” says Michael Dell, who developed the world’s most profitable computer company.
Dell began his business out of his college dorm room in the 1980s, assembling customized computers from stock computer parts. When faced with the challenge of selling his computers through a third party, Dell found a way to better serve his customers and reduce his expenses by selling directly to consumers, which also enabled him to further customize his products.
By taking a page out of Dell’s playbook, advisors can likewise learn to turn the turbulent market environment into an opportunity. Bringing a fresh perspective to marketing is one way to uncover opportunity. Here are some ways to more effectively reach current and prospective clients–often, at very little expense.
Client Segmentation = Better Resource Management
What Your Peers Are Reading
While using client segmentation is one way to make client relationships more profitable, it’s something many advisors don’t do. According to the AdvisorBenchmarking survey, client targeting is seen as a difficult task by respondents: it was rated 2.38 on a scale from 1 to 4, with 4 being the most challenging marketing activity. Taking the time to segment your clients–by portfolio size, number of referrals, and services you provide to them, for instance–will not only help you know them better, but will also help you work more effectively by ensuring that you’re spending the bulk of your time on your best clients.
Using Online Marketing
Smarter use of online marketing can enhance virtually every aspect of your business and help you to position your practice by proactively communicating with your clients on a regular basis. However, when it comes to attracting new clients, a large majority of advisors do not employ Web-based marketing–even though it is a relatively inexpensive and highly measurable way to reach specific audiences. Many advisors (73%) say that none of their clients was acquired through online marketing. “Advisors are so busy with day-to day tasks that they don’t focus on marketing–they are not being strategic,” says Andrew Gluck, president and CEO of Advisor Products Inc., a Westbury, New York-based company that develops Web sites, client newsletters, and marketing brochures for advisors. The company also invites advisors to attend their weekly educational webinars for free. “In this market, when assets under management have been cut in half, advisors need to differentiate themselves in a marketplace. If they don’t manage the situation, it will manage them,” added Gluck. We think that given its comparatively low cost, e-mail marketing is likely to become a bigger piece of many advisors’ marketing mixes this year.
The good news is that ongoing client communication was rated by investment advisors as “the least challenging marketing activity,” giving it a score of 1.46 on a scale from 1 to 4, with 4 being the most challenging marketing activity. The “most challenging” for investment advisors, on the other hand, is direct mail to solicit new clients–advisors rated the degree of difficulty for this type of marketing as 3.05 on a scale of 1 to 4, with 4 again being the most difficult.
Here are some suggestions on how to use online tools to service existing clients:
- l E-mail an online newsletter on a periodic basis– investors are hungry to hear their advisors’ thoughts and opinions.
l Post educational content on your Web site from well-respected sources– many investment providers offer such content to advisors at no charge.
l Consider holding conference calls with clients on a regular basis to supplement one-on-one meetings–some advisors even invite a guest speaker from a product provider firm to speak on an educational topic.
To attract potential clients, consider using some of these tools:
l Create an account for yourself on Facebook, MySpace, or LinkedIn to reach younger potential clients the way they want to be reached.