How Advisors Can Create Some “March Madness” Around Their Business

By Cynthia Stephens, VP of Marketing on Tuesday, March 6th, 2012

Imagine you make it to the “Final Four” on a high-net-worth investor’s list of potential advisors. You’re all potential champions, so beating the competition and winning the assets boils down to capitalizing on the little details that set you apart.

Most advisors plan to add new clients in 2012. If this is your goal, this means you will be competing to win these coveted new clients -- and protect your current book from being raided. The way you differentiate yourself will mean the difference between winning and losing.

Jack Waymire -- the president and CEO Paladin Registry -- and I recently presented findings from our survey of investors on why they hire and fire financial advisors. (Click here to watch the webinar replay.)

The good news for a lot of Trust Advisor readers is that nearly one third of investors said they prefer independent firms while only 16% prefer a brand-name Wall Street firm.

But with a crowd of independent advisors jockeying for the same pool of assets, independence only means you’re playing the right game. Winning requires a sound marketing strategy and knowing how to play to your strengths.

First tip: Get your ticket to the game by generating more value for your clients, which will make them more eager to make a referral and get you “seeded” when their friends ask.

Start with referrals. A full 40% of the investors we polled found an advisor after collecting names from friends and associates.

Unfortunately, fully half of the investors surveyed have not referred their advisor to another investor. Why not? Half of this group said that their advisor has not earned the right to receive referrals.

Ultimately, the type of service you offer is an important criterion for investors when selecting an advisor, and one of the most natural ways that any advisor can differentiate his or her service is to give clients a more comprehensive perspective on their financial situation.


Second tip: Advisors who provide a higher level of service by delivering investors a holistic view of their assets -- which is rapidly becoming the industry standard -- can position themselves as the financial point guard.

Investors who receive what we call a “holistic” view of all their assets -- 401(k) accounts, annuities, trusts -- are more loyal, report higher satisfaction ratings and tend to be relatively eager to recommend their advisor to friends and colleagues.

Investors told us they rely on their current advisors for a wide range of services: investment guidance, product recommendations, planning advice and money management.

This means that the ability to provide these services is no longer a differentiating factor.

Click here to read the executive summary of the survey for more detailed findings.

The advisor who can pull information from various sources is a natural choice as most valuable player on any client’s financial team.

Third tip: Document that you consider a clients’ entire financial picture and put their interests first.

Advisors can reassert their unique value in the eyes of clients and prospects alike by being the most ethical, open, team-oriented player in the conference.

In this post-Madoff environment, investors want full transparency and clear communication around advisor credentials, ethics and business practices. More than half of investors ask prospective advisors for documentation. Why not volunteer to provide it?

If you have adopted the fiduciary standard as a way of doing business it reinforces your role as a trusted advisor, sets you apart from the competition and will allow you to develop a broader and deeper relationship. Now, you need to communicate this to prospects.

Check out this paper -- Attract HNW Clients by Adhering to the Fiduciary Standard -- for tips on communicating what it means to be a fiduciary to your prospects.

As a marketer, I am always looking for a competitive advantage. I want to be in the game and I want to win.

Better understanding my buyer’s perspective is a daily endeavor and one that is crucial for any business. Listen to investors and what they have to say about why they hire and fire advisors.

Capture these winning edges, and you can differentiate yourself and your practice -- and cause an upset against bigger brand-name firms, something that doesn’t always happen no matter how “mad” the March Madness gets. 

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