How is your relationship with your clients? They have already chosen you, after all, as their ”trusted advisor” and have entrusted their retirement plans with you. So, what would they say about their relationship with you?
You might be surprised to learn that many clients are not satisfied with the relationship they have with their existing advisors.
"Research varies but some put the number of clients who are dissatisfied as high as 40%!1
Why these levels of dissatisfaction?
Advisors need to communicate more clearly to avoid straining or losing client relationships, says a survey released by SEI on Jan. 26, 2007. It also said “that frequent, proactive communication was at the heart of their strongest client relationships.”
As advisors, we are often preoccupied with how the products are performing, when our clients are more concerned with the relationship. A study from Russ Alan Prince and Brett Van Bortel found that neglected relationships were six times more likely to cause a client departure than investment returns.2 What can we do to strengthen our client relationships?
The most successful advisors have concentrated focus in their practice on stronger client communication. The results are clear: top advisors' client turnover rates are less than 5% a year versus 15% for average firms.3
Next Steps:
In our Power Marketing webinars we talk a lot about how a strong Client Communication plan is a best marketing practice for top advisors. Where do you start to build your plan?
First, make a commitment to expanding your relationships with your clients. This means being proactive in your communication rather than waiting for the client to ask you about what's happening in the market place. It means being more consultative as a path to getting a bigger share of the ”wallet.”
Second, improve the frequency and quality of the contacts you have with your clients.
An advisor is best served by finding out from each high-net-worth client what form and frequency of communication is best and tailoring meetings and contacts accordingly.4
John Bowen's firm CEG Worldwide reported in 2003 that the majority of very satisfied affluent clients ($500K+) averaged a total of 28 contacts (in person, by telephone, by mail and by email) with their advisors in a one-year period. Very dissatisfied clients averaged only 17 contacts over the same period.
It's not enough to send out a bunch of irrelevant communication. We are learning that quality is important also. When the relevance of the communication increases, the client loyalty factor skyrockets! Put simply, don't send clients the same type of message you would send a prospect. Don't send women baby boomers the same kind of communication you send octogenarian men. You need a way to use your database to drive relevant messaging.
There was a great article on Horsesmouth.com the other day; the title was “6 Ways to Lose Clients to Your Competitors.”
Here are 4 communication-related gaffs to avoid:
- Once a prospect becomes a client, disappear. At Wachovia Wealth Management, they contact new clients 15 times in the first 120 days. That's one heck of a benchmark.
- Show consistent lack of respect for your client. Show the highest respect for all of your clients. You never know who could be a relative, friend or acquaintance when you are ridiculing or mocking a client who might not be your cup of tea.
- Don't return phone calls promptly. This is a pet peeve. Return calls. If you have too many clients to return calls promptly, do something about it but return the calls.
- Don't ever, ever check to see how you are doing. Do you operate on the premise that ‘no news is good news'? Don't. Communication is the heart of the relationship. That means you need to be communicating with your clients about the good and the bad. After 9/11, the clients who were contacted by their advisors were more than 4 times more likely to stay with those advisors, bring referrals to those advisors and open additional accounts with those advisors than clients who were not contacted. Believe me; no one had a lot of good news to share with clients. But what mattered was the contact. Don't ever forget that.
Here's how BuildYourMarket.com can help you build stronger client relationships:
- Organize your information. Our Manage module helps capture and organize information about a client's family, assets & liabilities, preferred contact methods, hobbies and recreational interests, as well as tracking past contacts and action plans.
- Use this information to drive communication. Each of the categories of information we mentioned above could be used to ”segment” your clients, allowing you to send them more relevant communications about your services, upcoming events, news and educational opportunities.
- Use a formal communication plan. In the Learn module there are many training pieces to help you build your own client communication plan.
- Automate the process. Most advisors we have talked with are contacting their clients 5 to 10 times a year. Make a commitment to double that number of contacts by using our “7 Touch” and “16 Touch” packages. Each of these packages includes high value, full color, branded newsletters and memorable greeting cards for birthdays and other occasions. Consistently sending these pieces will reinforce your brand and your commitment to your client relationships. To save your valuable time, these are fully automated packages. Enroll a group of clients once and BuildYourMarket.com takes over, fulfilling each job for the newsletters and sending the cards on the appropriate dates.
- Follow-up. Make it a point during your client review meetings to ask your clients how you are doing. They will appreciate the question and you might get valuable feedback to help you grow your business.
1. Phoenix Wealth Management Survey August 2002
2.
CEG Worldwide November 2003
3.
Investment Advisor April 10, 2006
4.
Phoenix Wealth Management Survey June 2002
That's why you can't afford to miss our Power Marketing Webinar.
MARKETING HOW-TO
INSIGHT
