Prospecting in Today's Economic Environment

Let's face it, too many of us have stopped prospecting. Since our recent Black Swan many already successful financial advisors / advisor teams have hunkered down and focused on trying to keep as many clients [and their assets] as possible and avoided the heartbreak of rejection that inevitably comes with prospecting. After all, enough advisors are retiring or moving to other firms that you could always increase your book of business by avoiding risk and waiting for "new" clients to be assigned to you by your manager [of course that assumes that these new clients aren't already irritated with their past advisor/team and/or the firm].

Those with this attitude not only miss great opportunities, they also often find themselves unable to adequately service the clients they already have. Twenty-seven years ago [when I started in the business] virtually all revenue was transactional and you needed to build not only a large clientele, but also large positions in selected securities which turned over on a regular basis. This meant taking virtually anyone who could proverbially fog a mirror as a client and holding on to them until they or you died. This also meant that most of your clients "only heard from you when you had something to sell." For many advisors [we were called account executives then] the result was often a letter placed in their permanent file by smaller clients who NEVER heard from them because they couldn't ethically justify turning over their positions.

So what? What's that have to do with today? Today most revenues are generated by fee-based business, whether you use professional money managers or select all the securities yourself [or some combination of the two]. Most of the larger firms have conducted research that indicates that a good financial advisor can provide Ritz Carlton levels of service to only 100 relationships and still have time to prospect. That's right! Only 100 per advisor [so if you are on a team with two other advisors, your entire team can effectively manage and service only 300 households]. How many households/relationships do you currently manage in your book?

I have worked with hundreds of advisors / advisor teams who had five and even eight hundred households on their books per advisor and couldn't understand why they and their staff were constantly overwhelmed. Take some time this weekend to really examine your clientele. On Monday we'll discuss taking control of your business so you can increase not only the assets you manage but also the revenues you generate by working smarter, not harder. Thanks. kfg