Investment, Insurance, Superannuation
APEX Insights > Your Business > Retaining and leveraging clients go hand-in-hand
1 February 2019
Retaining and leveraging clients go hand-in-hand
An annual review with clients is the perfect time to engage them, showing the breadth and depth of your service to impress and retain them.
The process of attracting new clients and on-boarding them is an expensive and time-intensive activity. This can be more of a struggle in a year where so much change is expected. But you may not need to start from scratch. There are many advantages to working with your current clients to build up the business.
A value-based service proposition is sustainable
One of the most effective ways to generate growth is by leveraging existing clients. Keeping your clients happy and engaged can lead to growth in the number of assets they hold with you as well as the number of referral opportunities.
Not only is it an efficient solution that works to ensure your clients are well serviced; it future-proofs your organisation. Happy clients generate referrals for more clients. That kind of word-of-mouth should make marketing less burdensome.
Association of Financial Advisers national president Marc Bineham says while 2018 was a tough year for advisers, 2019 is also likely to present challenges because of the new educational requirements.
“While advisers do need to focus on improving their practice, they will also be very focused on gaining the required educational qualifications, which will be a distraction.”
Bineham says a key factor in growing business will be the need for advisers to move from product-based advising to a value-based model.
“Ten years ago it may have been enough for an adviser to sell products such as insurance or super but now it’s more about what value they provide,” he says. “Advisers need to be asking their clients more in-depth questions about their estate plan or their long-term financial goals. It’s all about having a holistic view of a person’s circumstances rather than selling them particular products. This will ultimately help them retain clients and generate growth through charging fees from their continued business.”
Ask for, and listen to, client feedback
Another way to leverage clients is to make sure you act on any feedback they provide. Bineham says there are two key times when you can ask for feedback.
“The first is after you bring them on,” he says. “At this point you could ask for an introduction to a new client. Often when an adviser has signed someone they then move immediately on to find another new client and it’s a huge wasted opportunity.”
The second time is when you have a review. “Don’t just assume if a client hasn’t complained then they are happy,” he says. “Ask them if they are happy and if not, what would they like to see changed. By tweaking your services to fit in with your clients’ needs you may find new growth opportunities.”
Engage with clients, on their terms
Fortify Financial managing director Glen James says advisers now have to really focus on servicing their clients and servicing them well.
“We all know it’s far cheaper to keep a client than get a new one,” he says. “And the longer you retain a client, the more opportunities you have to provide them with additional services that can grow your business.”
James suggests making sure your clients know exactly what you do by effectively communicating who you are and the type of problems you solve. This can be done by holding relevant and regular client events to strengthen existing relationships and encourage introductions and referrals he explains.
“As an example, I am planning a cheese-and-wine-tasting night for all my clients and have asked them to bring a friend along,” says James. “Events, especially if you have a good speaker, are a great way to be introduced to potential new clients. Referrals can also come from the buzz created by the event. Clients are not going to tell their friends that they’ve got a great financial plan; they’re going to tell them they went to a really cool cheese-and-wine tasting.”
James also regularly sends his clients a gift in the mail thanking them for being a client.
“There’s never a call to action on the gift but it’s something that’s useful – one year it was a smartphone battery charger. Advisers need to be doing different things to their competitors to make them stand out if they want to retain and leverage their client base. A large part of the growth in my business now comes through referrals.”
Include robo-advice in your offering
It is worth considering robo advice as another way to assisting advisers to grow their business effectively. Marc Bineham says five years ago US advisers were told their industry would soon be obsolete because robo advice would take over.
“However, in the past 12 to 18 months, the five biggest robo-advice firms have all partnered with advice firms. This has been the biggest trend in America. They found taken separately, advice and robo-advice firms can only go so far with regards to the efficiencies they can create, but if you combine the two, the efficiencies are greater than what each can achieve on their own.”
In Australia, robo advice has been more effective in the back office where it’s made advisers more efficient and brought the costs down adds Bineham.
“The biggest complaint from the public is that they want advice but it’s too expensive and this is where robo advice can help advisers grow their revenue.”
Servicing your clients in the most effective way possible through efficiently leveraging your relationships whilst integrating technology should inform advisers business planning for 2019 to ensure your business is match fit and ready to thrive in the future.
Retention and leveraging tips
1. Make more of the annual review
Ask clients about more than their financial goals. Drill down into their needs and concerns and ask whether they are still comfortable with their investments and financial strategy.
2. Get feedback
Conduct a short survey and identify the services where your client feels you are excelling, and ensure you are offering those services across your entire client base. While you’re at it, ask your clients where they feel you can improve your service. Ask targeted questions such as: do you feel we respond to your concerns in a timely manner? If not, how can we improve?
3. Keep communicating
Make sure you communicate after every meeting or call. If it’s an annual review, send clients an email thanking them for their continued business and make sure you acknowledge any concerns or plaudits.
4. Soft skills
Get into the habit of non-investment related contact, such as sending them a birthday card or message out of the blue to see how they’re going.
5. Offer to help the family
Offer a complimentary initial consultation to family members, especially children or grandchildren who may be in their first job. Having an introduction to the next generation is a good way to access new clients and build your business, especially if they are likely to receive an inheritance.
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