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What’s Working (or Not)?

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Lately, I’ve been starting some branch office presentations by asking, “What’s not working for you?”

Usually, the first item on the board is cold calling, which is quickly followed by seminars, which in turn is immediately followed by referrals. These channels, most everyone agrees, are not working today.

Except, I know they are, which brings me around to the “Law of Self-Justified Expectations”: If you think some marketing approach is not working, you can bet your bottom dollar it won’t work for you.

So let’s second look at each of these prospecting channels. Clearly, there are instances where each has not worked. But if they are working somewhere, will they work in your market? To put it another way, what are the successful advisors doing that the unsuccessful advisors are not?

Cold Calling

Is working: Discipline, proven technique, sticking to it.
I recently spoke with a young man at one of the wirehouse firms. He’s been in business about three and a half years. He’s 33 years old. By all rights he should not have survived. He is on track for $500,000 this year.

How did he do it? Calling business owners in the day and a residential list, scrubbed against the “Do Not Call” list, in the evening. He’s using a classic multi-call approach. He kept at it until he made it work. And then he kept doing it.

Not working: Tired old scripts that try to appeal to everyone.

Consider this opening line: “This is Fred Smartly with SmithWellsMorganMerrillUBSBank (the last remaining major firm). I’m calling to introduce myself and let you know of some services we have available.” (Snore.)
If you are doing this, STOP. This approach goes back to the ‘70s (or earlier!). And it probably didn’t work then. And it most certainly does not work now.

Is working: A precisely targeted approach geared to the needs of a particular list.
Consider this fact: People tend to buy what they know. Suppose you come up with a strategy to invest in technology stocks. Whom should you call? Farmers? Janitorial services? What about people at a high income level in technology companies?

You might open with, “I’m looking for a most unusual investor. This investor understands technology and likes to invest in it. Am I talking to the right person or should we part company at this point?”

Or, to a business owner: “I have a white paper that covers pitfalls of transferring management of your firm to your heirs, or to a buyer who will succeed you. It also covers an investment strategy designed to protect you in case the transfer does not go as planned. Are you interested in reading it?”

Tailor your approach to your list. And by the way, great marketing starts with list development.
In case you need some more help, I have posted “The 16 Best Scripts” free for the taking at


How many times have I heard someone say, “My area is seminar’d out”?

Not working: As with cold calling, the “old way” does not work. You really need to think many times before throwing 5,000 bad invitations against the wall and hoping for a decent response. Hope is not a strategy.

Other factors that make seminars not work:

PowerPoint poisoning. In my opinion, one of the reasons for low response to seminar mailings is that the investing public has been poisoned by extremely poor presentation. A slide is a visual aid. It is not the show. Standing to one side of a screen and flipping through 105 slides in 30 minutes is BORING. A decent number of slides would be three. In case you missed it, that’s 3, as in the number between 2 and 4.

Seminar is too short. I asked a group of advisers recently how long they thought a seminar should be. The consensus was 30 min. Why? Because older people have a short attention span. Both of these are false. With a well-rehearsed seminar, you can easily carry an hour and 15 minutes for a main presentation.

Total delivery time should be about an hour and 40 minutes. It can, and should be broken up into two segments. An introduction of about 20 minutes. Now serve dinner. (You don’t eat, but visit each table.) Now you have about an hour and fifteen minutes for the main presentation. You can’t bond with the group in 30 minutes. Nor can you do it in an hour and fifteen minutes with a poor presentation.

Is working: For seminars to be profitable, you have to control six variables. I have used the term “Seminar Success Zone” to refer to these. If just one of these statistics is out of “the zone,” one or more of the other statistics must be so high as to make profitability unlikely.

Example: your mailing response is 0.1 percent on a 10,000 piece mailing. That’s 10 respondents. Your show-up rate is probably 80 percent. So you have eight buying units at the seminar. If you are an average presenter, you will set appointments with 2-3. Let’s say you have two appointments. You have to sell both AND generate $10,000 in first year commissions and fees to break even. An extremely low response rate requires a 100 percent close rate, which no one can count on.

If you are or were a seminar marketer, or are thinking of becoming one, you need to go read “Seminar Success Zone.” It’s free at


In 2010, how many new clients were referred to you by existing clients (as opposed to professional introductions)? Four? Six? Most likely, less than 10.

Not working: Asking for referrals manifestly does not work. I’ve known this for years. I forbid my own sales team to do it. I have just come across some hard data to back this up.

In November 2010, Julie Littlechild, president of Advisor Impact, released a study of 1,000 investors, titled: “The Economics of Loyalty.” The study was sponsored by Charles Schwab. Managers and all financial advisors would do well to download and study it carefully.

Among its key findings: The clients who provide referrals are “engaged” clients and account for almost all referrals provided to an FA.

Why do they refer? Just because a client is motivated to refer does not mean he or she will take action. Clients take action when there is a clear need on the part of their friend or family member.

Only 2 percent of engaged clients provided a referral because they were asked (by the advisor) for a name, 48 percent because a friend or colleague had asked for a recommendation, but 57 percent because a friend/colleague discussed a financial problem and they were able to provide a solution.

Is working: For a client to provide a referral, you must have provided good investment advice and great service, stayed in touch, provided a written financial plan AND let all clients know that you value and accept their referrals.

I have written up a strategy to increase referrals without asking. You can get it online at

Not only does asking not work, but it annoys the client because it breaks a social contract: “If I like your service and have a friend or associate who needs it, I will recommend you.” Asking for referrals — preached by legions of sales executives — smashes that social contract. 


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