It’s all about the client experience.
When Schwab Advisor Services reported the findings of its most recent benchmarking survey, it revealed that some of the fastest-growing RIAs owed their success to a talent for making clients happy and thereby getting solid referrals.
These best-in-class RIAs saw net organic growth rise five times faster in 2012 than all other firms. And regardless of size — whether they managed $250 million to $500 million, $500 million to $1 billion or more than $1 billion — these fast-growing firms generated an average of 36% more new clients from referrals than all other firms, said Jonathan Beatty, senior vice president of Schwab Advisor Services’ sales and relationship management, when the findings were released.
“These firms have black-belt status at relationship marketing,” Beatty said at the time. “The client experience floats all the way through the system.”
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Sounds good. But what does the day-to-day client experience actually look like for one of those fast-growing RIAs in the Schwab survey?
According to Scott Swenor, CFO of boutique RIA Manchester Capital Management, a survey participant that Schwab identified as excelling in the client experience, referrals start with his firm’s clear understanding of its specific value proposition and ideal client profile. (In 2012, Swenor noted, Manchester had $2.5 billion in assets under management and 15% AUM growth.)
From there, Swenor said in a phone interview on Thursday, Manchester follows a written plan that extends across the firm’s four locations nationwide when it approaches people for referrals.
“Strategically, we set the concept of getting referrals through existing clients and centers of influence as a priority,” Swenor said. “We seek out a select number of law and accounting firms that can provide a mutually beneficial client experience if it fits in with our ideal client profile.”
“The client priority is ingrained into the firm’s culture, business model, employee rewards, strategic direction, policy and procedures,” Manchester Capital Management says in a comment on the firm’s culture.
At the same time, Swenor said, each of the firm’s four offices in Manchester, Vt.; Montecito, Calif.; New York City; and Charlottesville, Va., has the freedom to develop its own business development and marketing plan.