Show Some Love

Some years ago, I had a pastor whom I loved. But, I never seemed to be able to get his attention. After services each Sunday, I would wait in the handshake line to speak a word of encouragement to him and let him know I appreciated the sermon or was praying for him. Invariably, while shaking my hand, he was anxiously looking over my shoulder to see who was in line behind me. He was never in the moment. I eventually left the church. A few years later, he was caught in an adulterous affair and lost his ministry. Pretty sad. He wasn’t satisfied with what he had, and he wasn’t willing to continue to invest in his relationships because he was always looking for the thrill of the next one.

I used to be on the marketing treadmill, too, until one day I was told that my existing clients were having to wait sometimes 3 or 4 weeks for an appointment.  Clients were complaining that they could not get me on the phone. A few were threatening to leave me. I was frustrated about not being more attentive to my clients’ needs, but felt the pressure to focus on getting new ones. I felt I was acting like my former pastor, and I was ashamed. I was just too busy, and something had to change. My clients weren’t getting the love, and it was my fault. I was too focused on the next client to love the ones with which I had been blessed.

Unlocking the Potential

For the record, we have about 250 client families in our practice. We manage around $140M. I averaged 5.5 appointments a week last year. Things are pretty good. We’re blessed. How did we get here? It was a three-step process. First, I realized I had over marketed and that I needed help. We seriously curtailed our seminar schedule and I broke down and brought on another advisor. Not a loser from the industry who couldn’t make it somewhere else. I brought one up from operations. I started training him and helped him get licensed. In time, I was introducing him into my clients relationships, and he started doing some of the lighter planning and transactional work. Second, I identified about one third of my client base and began shifting the majority of the responsibilities for managing their accounts to my new associate advisor. This transition took some time, but we managed it well and it was successful. Third, we reorganized the practice’s revenue structure from commission only to hybrid. We started charging fees. This was a daunting task, but we buckled down and got through it, emerging victorious on the other side.

Love Your Book

Once I was able to reduce the number of client families I was personally responsible for, I was able to give them the love they needed and deserved, either personally or through my associate advisor. We started focusing more on spending time with them and attending to their needs. Clients went from zero or one appointment a year to three or four. Three things happened. Client attitudes started to change, referrals shot up, and new business started rolling in from these relationships. We eventually cancelled our seminar schedule all together, even though we still had $10,000 of unused credit we had paid to our marketing company for upcoming seminars that would never happen.  We were content. We went from a growth pace of 10-15% per year to more than 30% per year, and that with no active marketing plan. Our marketing plan was replaced with the concept, “Love the Book!”

Now, we continue to win new clients exclusively through referrals and our business is robust. As the practice grows, we add new associate advisors who are gradually introduced into existing client relationships and eventually take them over. No advisor, including me, is allowed to manage more than around 85 families, yet we bring on more than 50 new client families a year. About every 18 months we graduate a new advisor from our paraplanner track and everybody transitions clients to the new associate. We are thriving, and our clients are well cared for. Everybody wins. The goal of marketing is to eliminate its need.

Getting off the Treadmill

Most financial advisors I know are looking for ways to keep their calendars full with new prospects. They exhaust themselves on endless marketing treadmills adding as many new clients each year as possible. And, every time they add a new client, it gets harder and harder to do a great job for the ones they already have.  These advisors run seminars at expensive restaurants, they join the Rotary Club, they serve on school committees, they write blogs (ahem), they do anything and everything to find that next client. Certainly, at the beginning of a financial advisor’s career she has to do a lot of marketing, but it should not become a way of life. The goal of marketing is to eliminate its need.

Trouble is, most advisors already have too many clients. Let’s do a little math. If an advisor has say  300 client families and sees each one 4 times a year, that works out to 1,200 appointments annually. Assuming 4 weeks of vacation, illness, and business travel each year, this advisor must have 25 appointments a week just to keep up with her current book. Some of you may be thinking right now, “I can’t spend that much time seeing my existing clients or I’ll never have enough time to find any new ones.” Or, you might be thinking, “My clients don’t need that much of my time, besides, I already have all of their business.” Nonsense. You need to take a fresh look at your book.

The Book Produces

This is a mantra in our practice.  In fact, it goes like this, “The book produces; love the book.” Advisors like to believe that they have all of their client’s money. But, study after study has shown that most clients, especially the more affluent ones, prefer to work with more than one advisor, and sometimes three or four. This means that there is opportunity for more business in most client relationships. Business is continually being generated from our existing book of clients. A spouse retires, an inheritance comes in, the other advisor leaves his firm, a CD matures, dividends pile up, profit is taken on an investment, a job change necessitates a 401k rollover, a business succession plan needs creation, a partner buyout occurs, and on, and on, and on it goes. There is no end to the possibilities in a book of business. If you aren’t paying attention and cultivating this business, another advisor is getting it.

Stay tuned for Part II…

Treat Every Client Like a Celebrity

Celebrity infers celebration. That’s the idea. Celebrate every client. When prospective clients come up that elevator for the first time, they are often scared half to death. They have amassed a certain amount of wealth, yes, but to them it is their life savings. They are facing the prospect of retirement, which means no more paycheck. Whatever they have saved and invested up till now is going to have to last them the rest of their lives. It’s a scary prospect for most. For one reason or other, they have taken the step of coming to see me. They deserve my gratitude and respect, no matter how large or small is their life savings. Some advisors take the approach that every prospect falls into one of three categories: planning trail, product sale, or garbage pail. What a crass, insensitive, and selfish approach to labeling clients. No client is fit for the garbage pail.

These are people made in God’s image and they should be given every courtesy. When someone new sees me for the first time, she is going to get three 90 minute meetings in which I will undertake a review of her financial life, give her my personal assessment of the problems and concerns in her portfolio, and then present our financial world view. That’s a minimum of 4.5 hours over a couple of weeks’ time and represents a considerable value. We do this with every client, every time. No matter the size of the potential account. It’s the right thing to do. There is no charge for this work, and there is no demand for a commitment.

What About Minimum Account Sizes?

Uh-uh. Some advisors require a minimum account size before they will agree to work with a client. We don’t. Practice growth consultants routinely suggest that advisors establish minimum account sizes in order to grow their practices to “the next level,” whatever that means. We have never done this. In addition to questions of morality, little clients become big ones, and little ones refer big ones. True, it can be inefficient for me personally to give the same amount of time to both small and large accounts throughout the life of the relationship, but they deserve it nonetheless. This is why I have trained, experienced, professional associate financial advisors in my office who can help me ensure that every client of the firm gets the full program when it comes to service.

We Spoil Them Rotten

We want each client to feel like a million bucks, like a celebrity, like family. We adore our clients, every one. They are solid gold. Each member of our staff warmly welcomes every guest and offers a refreshment. Our tenured clients have adapted to our culture of hospitality and know what to expect. But, new clients are sometimes timid, often distracted, and usually under some degree of stress. So, it is not surprising if they refuse offers of refreshments. We want every staff member to drop in on each guest, physically touch them, and offer them something soothing and comfortable to brighten their spirits. No alcohol, of course, but a fresh ground cup of StarBucks coffee, a hot savory cup of premium herbal tea, or an icy Diet Coke can go a long way toward making our guests feel welcome and at ease. Everything is served on our finest crystal and china. It may take 3 or 4 tries, but we eventually break down the walls and are allowed to serve. Our staff are trained to get up from their desks, greet each visitor, introduce themselves, and offer a beverage and a pastry or dessert item. We bake cookies, danishes, quiches, and muffins every day. And, not just once at the beginning of the day either. We bake something fresh for every guest, every visit. Whatever it is we are baking gets popped into the oven just a few minutes before the guest arrives so that what is delivered to their conference room is aromatic, steaming, and fresh. It’s nice to be loved. Love and celebrate them.