Three Minutes That Lost a New Client

Thursday, February 14th, 2013

by Dan Richards, Cli​entIn​sights​.ca

Being a finan­cial advi­sor can be a roller coaster – one week you get a refer­ral that leads to a ter­rific new client, the next you lose a long-standing rela­tion­ship for rea­sons entirely beyond your con­trol. A recent call from a suc­cess­ful advi­sor look­ing for advice reminded of the fine line between suc­cess and failure.

An engi­neer by train­ing, Bob came into the invest­ment indus­try fif­teen years ago, today he runs a grow­ing prac­tice focused on mid and high-level cor­po­rate exec­u­tives in the tech and man­u­fac­tur­ing indus­tries. Last fall, he invited top clients to a mar­ket out­look lunch at a pri­vate room at a top local restau­rant. He asked clients inter­ested in attend­ing to call him directly to dis­cuss spe­cific ques­tions they wanted to address.

Bob sent out 50 invi­ta­tions and had about 15 clients say yes, over twice the response to sand­wich lunches in his board­room. (A free meal shouldn’t make a dif­fer­ence to mil­lion dol­lar clients, but expe­ri­ence shows that it does.) After talk­ing on the phone to the clients attend­ing about what they’d like to cover, he men­tioned that while this lunch was pri­mar­ily for exist­ing clients, he did have a few extra spots and asked if they had one friend or co-worker who might be inter­ested in attend­ing as their guest.

Cap­i­tal­iz­ing on an opening

A client in a senior role at a mid-sized tech com­pany brought along a work col­league, let’s call his guest Jim. Both the exist­ing client and Jim had sub­stan­tial equity in their firm, while they might not be huge clients cur­rently, they both rep­re­sent very sig­nif­i­cant future potential.

The lunch went well with lots of inter­ac­tion and dis­cus­sion. Next morn­ing, Bob called his client to get his impres­sions of the lunch and also to get per­mis­sion to fol­low up with Jim. While that follow-up call was politely received, Jim begged off an imme­di­ate meet­ing due to travel and work pres­sures, but did agree that Bob could add him to his monthly email list and then fol­low up in January.

Bob con­nected with Jim early in the new year and they agreed to meet for a casual con­ver­sa­tion over a mid-morning cof­fee at a Star­bucks across the street from Jim’s office. Bob got there early to ensure that they got a table in the cor­ner and was wait­ing when Jim arrived.

After get­ting there cof­fees, Bob thanked Jim for tak­ing the time to meet and said that his goal was sim­ply to get to know Jim bet­ter, then asked if he had any­thing in par­tic­u­lar he’d like to get out of their con­ver­sa­tion. Jim paused, thought for a moment and said, “Not really, no” … and then went on to say: “Before com­ing over, I glanced at your pro­file on Linked-In, was a bit sur­prised to see that the only thing there was your cur­rent role with­out any his­tory or back­ground, so I’d like to hear more about you.”

He then went on to say: “I assume you’ve looked at my Linked-In pro­file, do you have any ques­tions about my back­ground?”   There was an awk­ward pause while Jim waited for Bob’s answer. Bob first of all explained that updat­ing his Linked-In pro­file was on his to-do list, but other pri­or­i­ties had got in the way. And he apol­o­gized that he didn’t have a chance to look at Jim’s pro­file before their meet­ing and asked him to tell him a bit about himself.

Bob and Jim went on to have a cor­dial con­ver­sa­tion. When the meet­ing wrapped up after 30 min­utes, Bob sug­gested sched­ul­ing a time for a more in-depth dis­cus­sion of Jim’s sit­u­a­tion. Jim thanked him for for the offer, but said that while he’d enjoyed the con­ver­sa­tion, given how busy he is, he’s not inter­ested in talk­ing fur­ther at this point. Jim did agree that Bob could keep on his monthly email list and that he could check back in 12 months, but Bob walked away feel­ing that what had seemed a promis­ing oppor­tu­nity had turned cold.

The new expec­ta­tions for meet­ing preparation

Bob called me later that day to get my thoughts on how he should fol­low up with Jim and also what he could learn from the meet­ing. There were two obvi­ous take­aways from the meet­ing with Jim:

First, before con­tact­ing prospects and cer­tainly before meet­ing them, advi­sors will more and more need to get into the habit of first check­ing prospects’ Linked-In pro­files. This is obvi­ously less rel­e­vant if you work with retirees, but if you work with busi­ness own­ers or pro­fes­sion­als and cer­tainly if you work in the tech space as Bob does, this has become expected behav­iour. More and more, not check­ing someone’s Linked-In pro­file before call­ing them or meet­ing them will send the sig­nal that you’re not seri­ous enough to invest three min­utes in basic research. (Note that Bob could have checked Jim’s pro­file while wait­ing for him at Starbucks.)

Sec­ond, advi­sors need to get seri­ous about their own Linked-In pro­files. I rec­og­nize that some firms still limit what advi­sors can put on their Linked-In pro­files (although I’m not clear as to why there should be dif­fer­ent stan­dards for Linked-In vs advi­sor web­sites), but the indus­try as a whole needs to adjust to today’s real­ity here and do it sooner rather than later.

With regard to how to fol­low up with Jim, I sug­gested that Bob update his LinkedIn pro­file and then send Jim a note, thank­ing him for pro­vid­ing the impe­tus to move this up Bob’s pri­or­ity list. This won’t recoup all the ground that was lost, but per­haps will be a beginning.

For advi­sors who want to know more about how to incor­po­rate Linked-In to your prac­tice, below are links to two arti­cles that appeared last year:

The Game-Changer for Attract­ing Afflu­ent Clients

8 Steps to a Prof­itable LinkedIn Strategy

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Tackling the #1 cause of client loss

Wednesday, June 9th, 2010

Recent research with investors indi­cates that the tra­di­tional model of client con­tact is not work­ing in today’s envi­ron­ment — as a result advi­sors need to con­sider new alter­na­tives to how they communicate.

The rea­son is quite sim­ple: Despite their best efforts, many advi­sors are strug­gling to meet esca­lat­ing client demands for com­mu­ni­ca­tion — and clients are at risk as a result.

In a research study by Ipsos Reid last Novem­ber, 13% of Cana­dian investors said they are think­ing about chang­ing their pri­mary finan­cial advi­sor in the next year.

The main rea­son dri­ving a pos­si­ble change in advisor?

Almost half the time, the pri­mary dri­ver was lack of con­tact, with poor invest­ment per­for­mance ranked sec­ond at 30%.

And this despite the fact that investors say face to face meet­ings and phone calls from advi­sors have increased sig­nif­i­cantly in the past twelve months!

The prob­lem is quite simple.

Given mar­kets since Sep­tem­ber, clients want to hear from their advi­sors more than ever before. What­ever fre­quency your clients wanted to hear from you a year ago, it’s almost always higher today.

At the same time, many advi­sors say it’s hard to sus­tain the same level of com­mu­ni­ca­tion as a year ago much less increase it … meet­ings and phone calls are not just longer, but they’re also often harder. Some days advi­sors leave the office emo­tion­ally and phys­i­cally drained.

To close the com­mu­ni­ca­tion gap that often exists right now, advi­sors need to look at sup­ple­ment­ing day to day meet­ings and phone calls with meth­ods that can increase fre­quency of con­tact in a time effi­cient fashion.

Here are four ways to do this:

1. One of the best ways is to email­ing rel­e­vant arti­cles to stay top of mind.

For more infor­ma­tion: http://​www​.strate​gicim​per​a​tives​.ca/​b​l​o​g​/​?​p​=​156

2. Invite clients to sit in on infor­mal round table sand­wich lunches — this approach also has a prospect­ing ele­ment to it.

For more infor­ma­tion: http://​www​.strate​gicim​per​a​tives​.ca/​b​l​o​g​/​?​p​=​156

3. Con­duct­ing peri­odic con­fer­ence calls, in which you invite clients to lis­ten to an inter­view with a money man­ager or strate­gist from your firm.

For more infor­ma­tion:  http://​tv​.invest​mentex​ec​u​tive​.com/​v​i​d​e​o​-​6​1​2​0​-​P​a​r​t​-​Q​u​a​r​t​e​r​l​y​-​c​o​n​f​e​r​e​n​c​e​-​c​a​l​l​s​-​r​e​a​s​s​u​r​e​-​c​l​i​e​n​t​s​#​T​B​_​i​n​l​i​n​e​?​h​e​i​g​h​t​=​3​6​0​&​a​m​p​;​w​i​d​t​h​=​4​0​0​&​a​m​p​;​i​n​l​i​n​e​I​d​=​s​e​n​d​_​t​o​_​a​_​f​r​i​end

4. Orga­niz­ing a panel of speak­ers that pro­vide use­ful perspectives.

For more infor­ma­tion: http://​tv​.invest​mentex​ec​u​tive​.com/​v​i​d​e​o​-​6​0​2​4​-​P​a​r​t​-​A​d​v​i​s​o​r​-​t​o​u​t​s​-​e​l​e​c​t​i​o​n​s​t​y​l​e​-​t​o​w​n​-​h​a​l​l​-​m​e​e​t​i​ngs

Note that none of these are a sub­sti­tute for face to face meet­ings and reg­u­lar phone calls — but they can be an effec­tive sup­ple­ment. While they do involve a com­mit­ment of time, they are not typ­i­cally high cost.

It’s pos­si­ble that as mar­kets sta­bi­lize, demand for con­tact will return to pre­vi­ous lev­els. In the mean­time, advi­sors need to think hard about how they pro­vide the enhanced lev­els of con­tact that clients are look­ing for today.

For advi­sors inter­ested in pro­ceed­ing, I sug­gest you pick one of these meth­ods and make it part of your com­mu­ni­ca­tion arse­nal, get­ting good at it in the process.  By enhanc­ing con­tact lev­els, you can buy time and patience from clients until mar­kets recover and we return to more nor­mal times.

For more infor­ma­tion, please visit http://​get​keep​clients​.com.

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