With so many strategies and schools of thought out there on how to generate new (and returning) clients, building one’s book of business can seem like a daunting task. Lead generation is not just about investing time and effort while providing as much value as possible—it’s also about making sure your value is conveyed up-front. Otherwise, your message is falling on deaf ears. Take a look at how these three advisors have generated more business by investing in their current clients, covering all the planning bases, and partnering with pivotal centers of influence.
Retention brings acquisition
For Michael Morrow, CFP, of Morrow Financial in Ontario, Canada, focusing on current clientele is the best way to keep his business growing. Ninety percent of his efforts go to looking after his clients, which he says keeps his retention rate high and brings in referrals. “If I improve my client retention from 97 percent to 98 percent this year,” Morrow says, “that means I lost 1 percent fewer clients this year. In 10 years, that is 10 percent fewer that I didn’t need to replace.”
“Early in my career, I realized I needed to do something that would make me stand out from every other advisor. I knew I had to build my brand, but more importantly, I had to find ways to foster loyalty with my client base,” says Morrow, who’s been in the industry for 25 years.
“The easy things to do are the easy things not to do,” Morrow says. “Take the best golfers in the world. Twenty-six percent of their shots are drives, while 46 percent of their shots are putts. Yet when you go to a golf course, nobody’s practicing their putting, even though half of their time on the course is spent putting.” The putts—those simple, easy things—could be the difference between a client who leaves and a client who stays. Take two minutes to send a thank you card, a thoughtful gift, or an e-newsletter with something simple and of interest to your clients, he says.
To stay top-of-mind, Morrow employs a strategic call rotation. “Our top clients receive a call every three months and at least two client appointments per year; other clients receive a call every six months, at the very least. It doesn’t hurt anybody to pick up the phone for 10 minutes twice a year,” he says.
You’re always going to have clients leave, Morrow says. Most of the time, they leave because they started out happy but didn’t stay that way. “Is it easier to go out and replace your clients,” Morrow asks, “or is it easier to try extra hard to slow down the rate at which they leave?”
How does an advisor lose clients? By making lofty promises that are hard to keep, says Morrow. “If I call you all the time and say that I’m going to make you tons of money, I’m just setting you up to be disappointed. By overpromising, I underperform.” Not keeping promises also applies to basic courtesies like not showing up on time, he says. “You build trust by being consistent. Ultimately, what people are buying is trust and confidence, Morrow adds, and you can keep them around by showing up on time, being dependable, doing the things you say you’re going to do, and finishing what you start.
The holistic picture
While holistic planning means different things to different advisors, Jeff Warnkin, CPA, CFP of Avon, Ohio, says it involves integrated planning so that “the clients don’t have to go to four or five different professionals and get all sorts of potentially conflicting advice.” Warnkin, alongside his colleagues at The JL Smith Group, offers tax preparation as well as Medicare Supplement assistance to his clients, which in turn creates leads for his retirement and financial planning practice.
Twenty years ago, when Warnkin left public accounting to hang out his shingle as a tax preparer, he noticed his clients would open up to him with questions about their finances. “There was a disconnect between all of these disciplines—investments, legal, accounting. We’re all working in our own fox holes. The client isn’t best-served in the manner in which financial services are often being delivered,” he adds. “So that’s when I got my securities license, got my insurance license, and started bringing in attorneys to review legal documents.” Two decades later, Warnkin is sold on providing holistic service for his clients.
Warnkin, who works with retirees and pre-retirees, believes that marketing systems have to be profit-centers. “You’ve got people out there who are spending $200,000 or more a year on seminars,” he says. “When you put that kind of money out, you must sell something to recoup your cost. To me, that’s not a healthy way to operate a practice.”
Warnkin’s main lead-generation sources are the Medicare and tax portions of his practice. With Medicare open enrollment running October 15 through December 7, Warnkin goes to work in early October sending out approximately 1,500 direct mail cards to leads, and usually sees 8 percent to 10 percent filled out and returned. After following up with those prospects, his firm makes 40-50 appointments. “Our closing ratio is 80 percent,” he adds, “and out of those appointments, we’ll end up with 30-40 new Med Sup policies. That in and of itself covers the marketing cost.”
The timing works out really well, says Warnkin, since tax season is just around the corner. “Most people I talk to are not happy with their tax preparers,” he says. “You invite [the Medicare clients] back and offer them their tax return with an all-inclusive fee, no monkey business. I find that when you provide excellent service and good value to people, they want to know what else you can do for them. It’s just a natural extension of the relationship.”
And for Warnkin, that relationship is a very personal one. “As much as I hate to admit it, Medicare Supplements and tax preparation are commodities,” he says. “We really use a commodity transaction to introduce people to something that is intensely personal—the financial planning relationship. Better minds than ours have tried many different ways to market the importance of that relationship to the general public, but for some reason, it’s a very difficult message to get across,” Warnkin adds. “Everybody has to get their taxes done, and everybody turning 65 has to get a Med Supp.” By bringing in leads from these necessities, Warnkin is able to establish trust for the financial planning portion of his business.
Adding value and influence
When it comes to Warnkin’s value-add events, what used to be lunch-and-learns are now dinner-and-learns. “I’ve found that almost all of my retirees are busier when they retire than when they were working,” he says. “We were getting the same people to lunch-and-learns, only about 12-15 people total. Once we switched it to an evening dinner-and-learn format, it immediately jumped to 30-40 people. These dinners are first and foremost client appreciation events where we give back and let them know we appreciate their loyalty and trust,” Warnkin says. “One of the things that suffers when people retire is their social interactions. Here, clients make connections with each other, and that’s going to translate out into the community, as well.”
For Ari Fischman, CFP, hosting get-togethers that provide value to his clients is a great way to “do more than just a quarterly phone call or lunch.” His Southfield, Michigan advisory firm, Fischman Insurance Group, organizes topical events which encourage clients to bring others who could also benefit from the information. For example, Fischman has put on Medicare and Social Security seminars for clients who will soon turn 65. “That’s a business line we really have no interest in, and there’s no product necessarily associated with it,” he says, “but it’s something that matters to everyone in that age group—and it’s the market we’re trying to reach.”
Fischman, whose clients are mainly physicians and entrepreneurs, also partners with centers of influence, such as wealth management and property and casualty firms, to co-host marketing events with wine, cheese and hors d’oeurves where they can cross-refer. “It’s a great partnership. Not only do we do what’s best for the client from a holistic planning perspective by covering any gaps that they don’t specialize in,” Fischman says, “but we’re also growing each other’s businesses.”
When it comes to building these types of partnerships, Fischman says it all depends on what phase of your business you’re in. “Someone new in the business should be going to at least 1-2 events every week—your city’s economic club, charitable events, whatever it might be. And then you can start building relationships with potential centers of influence. You build a rapport and then eventually become partners with them, which will provide a lot more consistent leads later in your career.”
As far as asking clients for referrals, Fischman says it can easily contribute to what gives the industry a bad name. “There’s a defense system in the industry because asking for referrals can get pretty salesly. If someone handed me a blank list, or asked me to go through my cell phone and come up with 10 names—and a lot of advisors do this—I would get turned off. I think a lot of clients that I deal with would get turned off, as well.”
“You have to approach everything from the client’s point of view,” Morrow adds. “If I come to you and say, ‘I’m really trying to grow my business. Who do you know who recently got married, has a need for this service, etc.?’ Then I’m posing it as ‘you need to help me.’ What I’d rather do is be there when you’re trying to help your friend. Now the client is helping their friend, instead of their advisor.”
“I often think, ‘What is it like to be on the other side of that desk?’” adds Warnkin. “What is it like to walk through that front door? Fear of the unknown is a huge part of why people don’t go and get the advice and help they need. And when they’ve already met you—at a client appreciation event, or from another aspect of your planning services—they know what to expect. I think that’s a huge aspect to paving the way for them to come in and sit down with you.”