The world of the financial advisor is changing and with some of the changes, I am hearing that it’s a lot easier to focus on existing clients than bring in new prospects. This year, how about you make it part of your routine to get out into your community each and every day through activities that build on your natural habits? If you build on your existing behavior, you will find that new prospects crop up organically.
Here’s a spoiler alert about utilizing managed money and fee-based accounts as a business model. Fewer and fewer older advisors are opening new accounts. Unless you are in the insurance business and you have minimum client or premium numbers to meet, consider the principle that water always takes the path of least resistance. It’s easier to retain and grow current relationships compared to finding new ones. Case in point: It’s been said that it costs Visa over $250 to get a new customer. It makes one kind of sense for advisors to focus on keeping and growing what they have rather than scratching around for new clients. Yet somewhere inside you, you know that behavior is the start of a downward spiral. Besides, is that why you got into this business anyway? Face it; that kind of thinking isn’t what made you successful in the first place. So this year, it’s back to basics.
It’s easier to retain and grow current relationships compared to finding new ones.
How do you change behavior, specifically regarding increasing clients? Building a client base is sort of like growing a tree. “It’s farming, not hunting, it’s evolution, not revolution.” It takes time and steady progressive effort. Some clients take years. If you are like me, you like programs to help create structure in your day. So, here’s a daily hour-by-hour approach for adapting things you already do today (or should consider doing) aimed at bringing in more and better prospects. Hey, you might also be adding a few new activities along the way, and that’s not a bad thing either.
Before we go too much further, let’s define the term “prospect.” I define a prospect as person who is qualified to be a client within your definitions of A+, A, or B status. This person knows who you are and what you do. You know them well enough to begin a discussion about business, although you hope they approach you first. Ideally, they would tell your story to others. Is that fair enough?
Your New Daily Routine
Lets work to set up your day in a way that you, through your day, become a net for the gathering up of prospects. Use each and every thing you do in a mindful way and see what can happen. Here are a few examples:
6:30 a.m. The Gym. You’ve already joined the right gym. Do you go regularly? You now go a minimum of three times a week. You wear a logoed piece of clothing, alternating them so people don’t think you only own one shirt or pair of gym shorts. You’ve got a logoed gym bag. You pay attention to the lettering on other people’s T-shirts, hats, and gym bags. Over the year, you learn who they are, where they work, and what they do. Yes, you strike up conversations when and where you can. Just do it.
Planned result: Over 12 months, 12 people have asked questions about the market, life insurance, 401(k) allocations, or something they just saw on the financial news cable T.V. program over the leg press machine.
Running total: 12 down, 88 to go.
8:00 a.m. Breakfast. You’ve picked a local spot pretty close to work. Lots of small businesses are nearby. You sit at the counter drinking your coffee and reading the Wall Street Journal. You are, or become, a familiar face. You dress well. You’ve built a nodding relationship with the local business owners. You tip well.
Planned result: Daily breakfast over a year yields another 12 people who have asked questions about the market, insurance they are considering, stock they inherited, or municipal bonds. That’s only one per month.
Running total: 24 down, 76 to go.
9:00 a.m. You are in the office, ready for action. You’ve already read the WSJ and Financial Times. You are following your morning routine. You do what you do every day.
Noon (1) — Lunch locally. You’ve found a different coffee shop, luncheonette, or diner. This one is located in an area with a concentration of small manufacturing or wholesale businesses. You sit at the counter, taking the opportunity to get to know people as you have lunch. You talk and listen for a living, right? You are reading the business pages of the local newspaper, Barron’s or Investment Dealers Digest…you get the idea.
Planned result: You are a now regular in a different crowd. Over the year, another 12 people have asked questions about business lending, retirement planning, or key man insurance.
Running total: 36 down, 64 to go.
Noon (2) — Lunch with client. You probably have about a dozen clients retiring this year. Once a month you take one out to lunch to celebrate their upcoming retirement. You ask them to bring along a couple of friends or colleagues who are also retiring soon. They agree because they know you and love your work. Over lunch your client sings your praises about your retirement planning prowess.
Planned result: You have met 24 pre-retirees. Six people have said, “I need the kind of help you gave my friend.”
Running total: 42 down, 58 to go.
1:30 p.m. Back in the office. You’ve gotten your prospecting and appointment calls out of the way earlier in the day. You have a meeting scheduled that afternoon with a client over at their office to conduct an annual or quarterly review. You likely do many more of these meetings every week. Otherwise, 250 client relationships would take a year! You have asked for more money. You’ve asked who they know that doesn’t get these kinds of reviews. They introduce you around the office.
Planned result: Your clients are responsive. Ten percent come up with a referral. They introduce you. Twenty-five people are interested in meeting with you.
Running Total: 67 down, 33 to go.
6:00 p.m. (1)—I need a drink. How about you? You’ve found a nearby office building with a concentration of engineering, accounting, or law firms. There’s a bar on the ground floor or right next door. You’ve become a regular, turning up like clockwork three or four times a week. You sit at the bar. You watch the game. The regulars absorb you into their fold.
Planned result: These attorneys and accountants have plenty of clients who have loser financial advisors. They like you. Twelve referrals come your way during the year.
Running total: 79 down, 21 to go.
6:00 p.m. (2)—Night at the museum. You’ve just joined that museum in town, or that charity you support. You go to an opening once a month. It’s a free benefit of membership, right? You mingle with other members. You set a goal to meet six new people. You say hello to members you met previously. Interestingly enough, you are starting to see lots of familiar faces each month.
Planned result: Meeting six people monthly yields 72 people over 12 months. Twenty-four of them are qualified prospects
Running total: 102 down, 0 to go.
There you go, you are at 100 already. Now do you stop there? Is that what made you successful in the first place? Have you ever just done the minimum? Heck no… you are wondering about extra credit, right?
Going For the Extra Credit
You have begun to notice that during this process, your family life has taken a hit. You are leaving for the gym before 6:00 a.m. You are getting home about 8:00 p.m. most nights. It reminds you of those early days when you built your practice. You remind your spouse and family of what your business takes, what their lifestyle costs, but unfortunately, they aren’t as understanding as you had hoped.
Saturday 7:00 a.m. You take the kids to soccer practice. You are a sideline parent. This time you wear only one piece of logoed gear. You bring along a company golf umbrella. Make casual conversation with the other parents cheering on the team.
Planned result: Over nine months of school, you have come across nine people who ask questions pertaining to finances or investment. Remember, it only takes one question.
Running total: 111 down.
Family commitments: “No working on reviews this weekend. Have you forgotten it’s cousin Jimmy’s 37th birthday? Oh, we will need a present.” You find yourself attending an average of one family event per month. That’s what happens when you marry into a large family. You dress well. You chat with all the adults. The kids ask, “Who’s the stiff in the suit?”
Planned result: Years ago you penetrated your natural market effectively. However, new relatives have come out of the woodwork since then. You add six people who ask questions about what to do with an inheritance and another six people who don’t have a clue what college planning is all about
Running total: 123 down.
Client parties: Quite a few of your clients really like you. They invite you to college graduations, anniversaries, and holiday parties. It was a smart idea inviting several of them to your annual December blowout. They introduce you around to their friends and neighbors. They praise you continuously.
Planned result: An average of an invitation a month yields 12 people who are neighbors interested in talking about investing or insurance because their advisor never bothers to return their calls.
Running total: 135 down.
Closing the Circle
OK, this isn’t going to be like winning the prospecting lottery and yet you still have the potential to add 135 prospects without much extra effort. If you only turned 10% turned into clients, that’s 13 new relationships.
What would your managing director say to that?
SPEAK WITH ACOACH IN BATON ROUGE
Frank Hopkins is a life coach in Baton Rouge who is certified as a Professional Coach (CPC) by the Institute for Professional Excellence in Coaching (iPEC). Frank has helped numerous people to go through emotional change in a way that is positively transformative.