Prospecting in this environment

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Oct 15, 2008 8:05 am

What are you guys finding the environment is like for bringging in new money. My prospects are scared to death. Don't want to make a move. I see it as a tough qtr for bringing in new money. Nothing I present will get them off the fence.

Oct 15, 2008 9:16 am

I think the best mode right now is to show strength and knowledge in current situations.  I set an appt yesterday with a couple who work with another local LPL office.  He was scared to death.  He wasn't even sure what he was invested in or why he was in the particular investment.  My plan, as always, is to evaluate and explain to them what the investment is and what it can do for them.  My goal isn't to liquidate or change to and make a commission, its hopefully to gain a couple of new accts and push for referrals.  To me, asset growth is just as important right now as revenue.  We are very lucky in the Indy platform with the payouts.  We can survive with lower revenues because of the payout and come out on the other end with a great foundation.  Stop pushing product and sell sympathy and understanding in this market.

Oct 15, 2008 10:54 am

I agree with Spears.  This is a great opportunity to pick off low-hanging fruit - the potential clients that have been largely ignored by their advisors.  I have found this to be:

1. Smaller wirehouse clients (100K-350K) of big producers
2. Clients of almost all bank advisors (typically, they have thousands of clients and aren't really proactive)
3. Individuals without an advisor, and don't know WTF to do with their 401K or IRA.
 
IMHO, the better advisors do a decent job of staying in contact with their clients (especially the larger ones), so in this environment, trying to poach a big client from a good advisor is tough - you can't really do it on performance (unless there is some extreme reason), and most of them are too nervous to move anything, and are "somewhat" comfortable sticking with who they know right now.
Oct 15, 2008 11:25 am

We are very lucky in the Indy platform with the payouts.  We can survive with lower revenues because of the payout and come out on the other end with a great foundation.  Stop pushing product and sell sympathy and understanding in this market.

 
Wisdom. Once you get to a certain point, you can service the heck out of what you have, and grow mainly by referral. 
 
Some kind of financial planning based service model is very useful - continuously collecting the client's comprehensive personal financial data - and feeding projections, strategies, choices, "the plan" back to the client - is useful, along with the investment management function, which is increasingly commoditized - how basic can it get?
 
 
Oct 20, 2008 5:02 pm

Why not play match maker? I've introduced prospects to potential clients. Almost 90% became my clients. While this isn't an easy thing to do every day - I think that's exactly why it works so well.
This strategy is scalable if you focus on an industry that you really understand - once you build a reputation as a match-maker and not a product pusher the business is much easier.

Oct 20, 2008 6:57 pm

I don't get it. You introduce prospects to "potential clients"? Isn't a potential client a prospect? I may just be slow tonight.

Oct 20, 2008 7:56 pm

You aren't slow, that doens't make sense

Oct 20, 2008 9:07 pm

No, I guess it didn't make sense the way I explained it. So, let me try again with an example. Hope this clarifies it ...

A very good client owns several large commercial properties. One day I was visiting him and he was complaining about how a plumbing contractor did a terrible job for him and left him with a building violation. I told him not worry. I had a client ( a general contractor) who had a great commercial plumber (true) and I'd be happy to connect them.

I call my general contractor client ... he connects me to his plumber ( not Joe the Plumber, but a very wealthy business owner I'd been trying to land) I call the plumber ... not to pitch products, not to pitch financial planning - but to hand him $75,000 in new business.
No screens, no voicemail, no rejection. He takes my call and is genuinely grateful.

Plumber is thrilled that I made him money. He invites me to meet up with him to discuss his company's 401k ... with 50 members, and buckets of cash.

General Contractor client is thrilled ... because he was able to help his good friend and business associate. I earn points.

Property owner is very happy because the Plumber was a real pro. I earn points there too.

If I had called that plumber's office to pitch my products I would never have succeeded. But, by being a matchmaker he felt an obligation to return the favor and listen to my sales pitch.

Make sense? Sorry for any confusion.

Oct 20, 2008 9:20 pm

Great example. Not that you need to (given the example above, you already have the hang of it), but you may want to read Tom Stanley's books, which are filled with this kind of stuff. Networking with the Affluent is a good start:

http://www.amazon.com/Networking-Affluent-Thomas-J-Stanley/dp/0070610487/ref=sr1_1?ie=UTF8&s=books&qid=1224551686&sr=8-1
 
You can get a used one for $7
Nov 6, 2008 11:02 pm
ezmoney:

What are you guys finding the environment is like for bringging in new money. My prospects are scared to death. Don't want to make a move. I see it as a tough qtr for bringing in new money. Nothing I present will get them off the fence.



I agree, I'm seeing a lot of this. People are so beatdown by the market's volatility and current level that they're just seizing up and can't make a logical decision to move - "I think I'll wait till things come back up a bit". Even folks who committed to doing a transfer or a rollover are balking on me now. My usual approach (that works some of the time) is:

"Sure, I understand exactly where you're coming from. It's been a rough year and all our accounts are down. But look, we had 3 compelling reasons to initiate this relationship and move your account to my safekeeping:
1. Your account was performing poorly even in a good market
2. You had poor service and the account wasn't balanced appropriately
3. Your last advisor failed to stay in touch and provide proper oversight.

Would you agree that those were the primary concerns that existed and brought us together? Okay then - those compelling reasons still exist and in today's market it's even more critical for us to position your money where it's being managed properly, and your money is helping you move toward your goals, rather than away from your goals.

Obviously we know we can't control the market. We do know that successful investors focus on what they can control. Let's move forward and get your money working for you."

Hope this helps someone.

PS - On a side note, to avoid nervous nellies I'm focusing my prospecting
more on business owners and medical/dental clinics, rather than
prospecting individuals. Although of course I'm still asking for
referrals from individual clients.

Nov 7, 2008 8:38 am
QuimbyBrown:

No, I guess it didn't make sense the way I explained it. So, let me try again with an example. Hope this clarifies it ...

A very good client owns several large commercial properties. One day I was visiting him and he was complaining about how a plumbing contractor did a terrible job for him and left him with a building violation. I told him not worry. I had a client ( a general contractor) who had a great commercial plumber (true) and I'd be happy to connect them.

I call my general contractor client ... he connects me to his plumber ( not Joe the Plumber, but a very wealthy business owner I'd been trying to land) I call the plumber ... not to pitch products, not to pitch financial planning - but to hand him $75,000 in new business.
No screens, no voicemail, no rejection. He takes my call and is genuinely grateful.

Plumber is thrilled that I made him money. He invites me to meet up with him to discuss his company's 401k ... with 50 members, and buckets of cash.

General Contractor client is thrilled ... because he was able to help his good friend and business associate. I earn points.

Property owner is very happy because the Plumber was a real pro. I earn points there too.

If I had called that plumber's office to pitch my products I would never have succeeded. But, by being a matchmaker he felt an obligation to return the favor and listen to my sales pitch.

Make sense? Sorry for any confusion.

 
I had an inkling that maybe this is what you meant.  It makes perfect sense.  This is one of the concepts I haev really learned through BNI.  I have a ladyu in the group that is a commerical banker.  She is a master "matchmaker" (as you put it).  She knows everyone in the area, and I have observed the way she works.  And she NEVER imply's that she wants something in return.  I think that's why she's so good at it.  I'm working at this, however, at this point I am still growing my personal database of business owner/influential people.  Most of them are still the engineer/exec/manager types.
Thanks.