Cold Calling - Can You Get Large Accts?

1.9 mil first met on cold call, then two meetings to close.

 1 mil with 2 mill in referrals in less than a year  - 1 cold call, 2 meetings, and a nice card. I've always at least met my clients face to face once.  

Otane, you are so full of self doubt. Relax, that’s normal.

  Once upon a time in place not so far away financial advisors were called stockbrokers. They built huge books of business using one tool and one tool only; the phone. They employed many different strategies to achieve this success. Some were true stock brokers, calling and pitching their best stock ideas. others were bond experts, calling and enticing investors to to take advantage of their bond offerings. Others specialized in insurance or retirement planning. Talk to these "brokers" and their business philosophies were as different as night and day. However, their process for obtaining that business was amazingly the same.   Then one day the chiefs that controlled the business decided that their income was too unpredictible. They decided that clients should pay fees instead of commissions. And, they decided that thier sales force should be named advisors, not brokers. Then they created cookie cutter wrap accounts that employed money managers to justify the enormous fees they charged. Then, the world changed. The markets crashed, and the always safe fee accounts lost billions of dollars. The suits that run the street decided a "Rebranding" was in order. They rebranded themselves as Wealth Managers. Essentially, same pig, new lipstick. Through this genesis using the phone to generate business became not only passe, but taboo. "It doesn't work" cried the suits who had never generated a dollar of revenue themselves.  "We're above that, wealthy clients don't respond to cold calls!" exclaimed other expert managers. And, with that proclamation cold calling was relegated to the circular file.   That "they" are wrong only a few will figure out.   Now i tell you all that to tell you this: Cold calling works. Some, if not most of the largest books on the street were built on cold calling. There are people on this board, trainees, who are building huge books at this time. And time is the key. it takes time.   To answer your question: can you get large accounts from cold calling? Yes you can. You can even open large accounts on a cold call. All you have to do is find a person with money and ask him/her to buy something. It is that simple! An advisor i know opened an account on a two million dollar trade earlier this year. That account today is over $14,000,000. yes, he did that by dialing the phone. Others in our firm routinely open mid six figure accounts on a daily basis. Many more accounts are opened at a sub-six figure level and quickly built into large six or seven figure accounts. And, in the interest of  full disclosure, some accounts are opened for small amounts and never grow. Still, everytime you open a new account you gain a seat at the table and the opportunity to grow your business through account penetration.   I've not met most of my clients. My strategy: Open'em on a bond or other fixed income. Do a few trades and then offer a portfolio analysis. If they turn me down, i've still got a FI buyer. It's a simple process.   Of competitors accounts, always ask: Are you happy with your portfolio? Are you happy with your advisor?   Stop doubting yourself. This works! it's the hardest thing you'll probably ever do on a business level. Work it hard and it will pay off bigtime!

I think the biggest problem I have concerning doubt is the shear volume of call you have to make to find somebody. Also for new people we are looking to make money as fast as possible so we end up not calling because we feel it takes too long.

    Bond Guy is this day and age with DNC and everything do you think it is harder. Especially if you consider that most on the DNC are not qualified.   People always say call business but are not able to fully define what that means(probably don't call). What do people classify as a business call (list of employees working at the company, company vp list, or just dialing up the local business parks and asking for the owner?)   The accounts you refer to regarding six figure openings, are those business calls or residential?

I'm making well over $100k and I'm in month 25 (last day).

Is that fast enough?  all from cold callling.

[quote=henrybar]I think the biggest problem I have concerning doubt is the shear volume of call you have to make to find somebody. Also for new people we are looking to make money as fast as possible so we end up not calling because we feel it takes too long.

Cold calling can be one of the fastest routes to opening new accounts. Call'em and close'em. Or, call'em, email info, and then close'em. I was wrorking on a 1/2 mil account today. I had the 4x7 card (yes, old school) in front of me. From first call to account opening-two weeks. Second trade-one week. Third trade-two weeks later. Today, about seven months in the account is just shy of 600k.     Bond Guy is this day and age with DNC and everything do you think it is harder. Especially if you consider that most on the DNC are not qualified.   It is harder. Still, very doable. Most people you call aren't qualified. That's why we qualify them. We are qualifying them to do business with us. Most don't pass that test. This is a business. People without money may be nice folks, but we can't help them and they can't help us. That's why we don't deal with poor people. Don't waste your time. Thank them for their time-click-diatone-next call!   People always say call business but are not able to fully define what that means(probably don't call). What do people classify as a business call (list of employees working at the company, company vp list, or just dialing up the local business parks and asking for the owner?) I guess you could do that. personally, I never make a call unless i know the name of the person i'm calling. Business directories are a good place to start. The local library will have them in the reference section. Then there's the local Chamber of commerce, biz groups etc. You want the owner or top management.   The accounts you refer to regarding six figure openings, are those business calls or residential?   My largest accounts are from calling business owners. However, both sources will yield propects. I have many, many large accounts that were sourced from residential calls.[/quote]

[quote=Gaddock]

I’m making well over $100k and I’m in month 25 (last day).

Is that fast enough? all from cold callling.

[/quote]



I am looking to do around $6K gross so about $72K first year? possible?

Don’t use DNC as a barrier. It doesn’t work that way. NO barriers. Work through it.

 

Bond:

  Thanks for the advice.   I am not self-doubting since cold calling is really the only avenue I have to reach  prospects. I talked to my complaince officer, and every idea I had (iei.internet) besides cold calling was shot down. That didn't mean I was trying to avoid cold calling, I was going to use it in addition.   Most of the guys in my office said that you couldn't get big money without having a face to face meeting. I didn't know, so that is why I asked.   I am working on my script as we speak, so once I get the license out of the way I will be dialing a crap load a day - 12 hours a day.   Thanks for tip on the bonds. Largest producer in the office is all bonds as well, and being a former CTA I am going that route as well. No need to have clients get stomach aches with the volatility of equities.    

[quote=BondGuy] Otane, you are so full of self doubt. Relax, that’s normal.

Once upon a time in place not so far away financial advisors were called stockbrokers. They built huge books of business using one tool and one tool only; the phone. They employed many different strategies to achieve this success. Some were true stock brokers, calling and pitching their best stock ideas. others were bond experts, calling and enticing investors to to take advantage of their bond offerings. Others specialized in insurance or retirement planning. Talk to these “brokers” and their business philosophies were as different as night and day. However, their process for obtaining that business was amazingly the same.



Then one day the chiefs that controlled the business decided that their income was too unpredictible. They decided that clients should pay fees instead of commissions. And, they decided that thier sales force should be named advisors, not brokers. Then they created cookie cutter wrap accounts that employed money managers to justify the enormous fees they charged. Then, the world changed. The markets crashed, and the always safe fee accounts lost billions of dollars. The suits that run the street decided a “Rebranding” was in order. They rebranded themselves as Wealth Managers. Essentially, same pig, new lipstick. Through this genesis using the phone to generate business became not only passe, but taboo. “It doesn’t work” cried the suits who had never generated a dollar of revenue themselves. “We’re above that, wealthy clients don’t respond to cold calls!” exclaimed other expert managers. And, with that proclamation cold calling was relegated to the circular file.



That “they” are wrong only a few will figure out.



Now i tell you all that to tell you this: Cold calling works. Some, if not most of the largest books on the street were built on cold calling. There are people on this board, trainees, who are building huge books at this time. And time is the key. it takes time.



To answer your question: can you get large accounts from cold calling? Yes you can. You can even open large accounts on a cold call. All you have to do is find a person with money and ask him/her to buy something. It is that simple! An advisor i know opened an account on a two million dollar trade earlier this year. That account today is over $14,000,000. yes, he did that by dialing the phone. Others in our firm routinely open mid six figure accounts on a daily basis. Many more accounts are opened at a sub-six figure level and quickly built into large six or seven figure accounts. And, in the interest of full disclosure, some accounts are opened for small amounts and never grow. Still, everytime you open a new account you gain a seat at the table and the opportunity to grow your business through account penetration.



I’ve not met most of my clients. My strategy: Open’em on a bond or other fixed income. Do a few trades and then offer a portfolio analysis. If they turn me down, i’ve still got a FI buyer. It’s a simple process.



Of competitors accounts, always ask: Are you happy with your portfolio? Are you happy with your advisor?



Stop doubting yourself. This works! it’s the hardest thing you’ll probably ever do on a business level. Work it hard and it will pay off bigtime![/quote] I’ve not met most of my clients. My strategy: Open’em on a bond or other fixed income. Do a few trades and then offer a portfolio analysis. If they turn me down, i’ve still got a FI buyer. It’s a simple process.



I find it very interesting that you have never met most of your clients.

[quote=Otane]Bond:

  Thanks for the advice.   I am not self-doubting since cold calling is really the only avenue I have to reach  prospects. I talked to my complaince officer, and every idea I had (iei.internet) besides cold calling was shot down. That didn't mean I was trying to avoid cold calling, I was going to use it in addition.   Most of the guys in my office said that you couldn't get big money without having a face to face meeting. I didn't know, so that is why I asked.   I am working on my script as we speak, so once I get the license out of the way I will be dialing a crap load a day - 12 hours a day.   Thanks for tip on the bonds. Largest producer in the office is all bonds as well, and being a former CTA I am going that route as well. No need to have clients get stomach aches with the volatility of equities.    [/quote]   No doubt. You absolutely have to stay away from those evil equities. No reason to advise people to put their money in the best producing asset class of the last 200 years, especially 35% off the all time high. It is much better to wait until things "improve" and things rebound.

[quote=Ron 14][quote=Otane]Bond:

  Thanks for the advice.   I am not self-doubting since cold calling is really the only avenue I have to reach  prospects. I talked to my complaince officer, and every idea I had (iei.internet) besides cold calling was shot down. That didn't mean I was trying to avoid cold calling, I was going to use it in addition.   Most of the guys in my office said that you couldn't get big money without having a face to face meeting. I didn't know, so that is why I asked.   I am working on my script as we speak, so once I get the license out of the way I will be dialing a crap load a day - 12 hours a day.   Thanks for tip on the bonds. Largest producer in the office is all bonds as well, and being a former CTA I am going that route as well. No need to have clients get stomach aches with the volatility of equities.    [/quote]   No doubt. You absolutely have to stay away from those evil equities. No reason to advise people to put their money in the best producing asset class of the last 200 years, especially 35% off the all time high. It is much better to wait until things "improve" and things rebound. [/quote] Flip to page 5 on the jp morgan guide to the markets...."Ok mr. client, if you could invest your money here or here, where would you put it?"

"Flip to page 5 on the jp morgan guide to the markets…“Ok mr. client, if you could invest your money here or here, where would you put it?” "

  I would put it with a guy that was referred to me by the endowment committee chairman, a guy who has a strategy that puts your money to work. He has lower fees and much higher returns with half the markets risk, a guy named Gaddock

[quote=Ron 14][quote=Otane]Bond:

  Thanks for the advice.   I am not self-doubting since cold calling is really the only avenue I have to reach  prospects. I talked to my complaince officer, and every idea I had (iei.internet) besides cold calling was shot down. That didn't mean I was trying to avoid cold calling, I was going to use it in addition.   Most of the guys in my office said that you couldn't get big money without having a face to face meeting. I didn't know, so that is why I asked.   I am working on my script as we speak, so once I get the license out of the way I will be dialing a crap load a day - 12 hours a day.   Thanks for tip on the bonds. Largest producer in the office is all bonds as well, and being a former CTA I am going that route as well. No need to have clients get stomach aches with the volatility of equities.    [/quote]   No doubt. You absolutely have to stay away from those evil equities. No reason to advise people to put their money in the best producing asset class of the last 200 years, especially 35% off the all time high. It is much better to wait until things "improve" and things rebound. [/quote]   Did someone say something about staying away from equities? Because personally, I'm a big Alfred Cowles fan. i think he had it right. So, speaking for myself, I'm a big stock guy. Stocks are the reason i became a stock broker/financial advisor/wealth manager.    But wait, we weren't having a asset class versus asset class discussion. We were talking about how to build a business. And, to do that you must gain one's trust.  One way to do that is to use a high quality product that doesn't blow the client's assets up. That's why some of us use bonds to build our businesses. I tell people"Go over to ML for all that we are the world Wealth mangement mumbo jumbo but buy your bonds from me. After-all you wouldn't go to a general practioner for brain surgery would you?" Then i give them first class service like they have never seen while the ML guys talks to them twice a year and acts like he's doing them a favor. Sooner or later the phone rings and the client asks if we can handle the mumbo jumbo part of their portfolio. "Oh, you mean the easy part? Not a problem!   So, you see, it's not about one asset class versus another. It's a business process that allows those of us who employ it to first gain a seat at the table, then prove to the client that we are everything we say we are. Show the client that we really do care about them, because we do. And then blow the competition away by doing no more than simply fulfilling the promises we make.

[quote=Gaddock]"Flip to page 5 on the jp morgan guide to the markets…“Ok mr. client, if you could invest your money here or here, where would you put it?” "

  I would put it with a guy that was referred to me by the endowment committee chairman, a guy who has a strategy that puts your money to work. He has lower fees and much higher returns with half the markets risk, a guy named Gaddock [/quote]   I would just invest in a firm that employs traders on actual trading floors. Traders who make equal decisions with every investors money instead of spending their time meeting with and managing other clients.

Ron 14:

I made the comment towards Otane because of another conversation under a different heading.

I wish you luck with your stock pitch.

[quote] So, you see, it's not about one asset class versus another. It's a business process that allows those of us who employ it to first gain a seat at the table, then prove to the client that we are everything we say we are. Show the client that we really do care about them, because we do. And then blow the competition away by doing no more than simply fulfilling the promises we make. [/quote]

I agree. I am trying to differentiate myself with products that the prospect may find interesting. But, keeping the client safe in the beginning is a big step toward a larger allocation.

[quote=Otane]

Thanks for tip on the bonds. Largest producer in the office is all bonds as well, and being a former CTA I am going that route as well. No need to have clients get stomach aches with the volatility of equities.



[/quote]



Otane - what happens when all of your bond clients’ friends are getting 70% returns over at Gaddock’s office? What do you think they are going to say to you?



Or even Ron’s clients’ average 8-10%/yr?

[quote=Gaddock]"Flip to page 5 on the jp morgan guide to the markets…“Ok mr. client, if you could invest your money here or here, where would you put it?” "

  I would put it with a guy that was referred to me by the endowment committee chairman, a guy who has a strategy that puts your money to work. He has lower fees and much higher returns with half the markets risk, a guy named Gaddock [/quote] The thing I like about that guy Gaddock is how gosh darned humble he is.  

[quote=Moraen] [quote=Otane]

Thanks for tip on the bonds. Largest producer in the office is all bonds as well, and being a former CTA I am going that route as well. No need to have clients get stomach aches with the volatility of equities.
 
 [/quote]

Otane - what happens when all of your bond clients' friends are getting 70% returns over at Gaddock's office? What do you think they are going to say to you?

Or even Ron's clients' average 8-10%/yr?[/quote]   I know you are directing this at otane, but, is this a serious question? Because, as someone who does more than his fair share of bond business I'm reading this as a joke. I'm right, right?

[quote=BondGuy] [quote=Moraen] [quote=Otane]

Thanks for tip on the bonds. Largest producer in the office is all bonds as well, and being a former CTA I am going that route as well. No need to have clients get stomach aches with the volatility of equities.



[/quote] Otane - what happens when all of your bond clients’ friends are getting 70% returns over at Gaddock’s office? What do you think they are going to say to you? Or even Ron’s clients’ average 8-10%/yr?[/quote]



I know you are directing this at otane, but, is this a serious question? Because, as someone who does more than his fair share of bond business I’m reading this as a joke. I’m right, right?[/quote]



BG - my point is if he’s worried about his clients’ tummy aches over a little volatility and only limits the volatility by buying bonds, he’s going to have those same clients’ wonder why they aren’t getting the same returns as their friends who are investing across the spectrum.



Now, your clients may be different, as you have likely educated them over the course of several years. And I realize that you can make some good money trading bonds, but I’m not sure that’s what Otane is talking about.

Clients forget about the amount of risk they may take when the markets go up and then blame their advisor when they lose money during a selloff.

  Better to have a risk coversation upfront and keep referring to it during reviews so that clients understand the what and why of what you are doing. 

[quote=Moraen] [quote=BondGuy] [quote=Moraen] [quote=Otane]

Thanks for tip on the bonds. Largest producer in the office is all bonds as well, and being a former CTA I am going that route as well. No need to have clients get stomach aches with the volatility of equities.
 
 [/quote] Otane - what happens when all of your bond clients' friends are getting 70% returns over at Gaddock's office? What do you think they are going to say to you? Or even Ron's clients' average 8-10%/yr?[/quote]
 
I know you are directing this at otane, but, is this a serious question? Because, as someone who does more than his fair share of bond business I'm reading this as a joke. I'm right, right?[/quote]

BG - my point is if he's worried about his clients' tummy aches over a little volatility and only limits the volatility by buying bonds, he's going to have those same clients' wonder why they aren't getting the same returns as their friends who are investing across the spectrum.

Now, your clients may be different, as you have likely educated them over the course of several years. And I realize that you can make some good money trading bonds, but I'm not sure that's what Otane is talking about.

[/quote]   It is a matter of getting clients with the same mindset, and I think during these times it won't be difficult. There will always be someone with a greater return or drawdown - I am not going to worry about it.   Having been a CTA and managed over 30 million at one time, I had clients that I thought were use to the volatility of commodities - I was wrong. So, I understand the mindset of the most "sophisticated" investor.    

Moraen:

BG - my point is if he’s worried about his clients’ tummy aches over a little volatility and only limits the volatility by buying bonds, he’s going to have those same clients’ wonder why they aren’t getting the same returns as their friends who are investing across the spectrum.

Now, your clients may be different, as you have likely educated them over the course of several years. And I realize that you can make some good money trading bonds, but I’m not sure that’s what Otane is talking about.

  OK, so you guys are having a cross thread conversation because I'm not reading anything about volatility in this thread?   I buy fixed income, mostly tax free bonds, not as an asset allocation, but as an income generator. I'm specifically looking for prospects who want income. Not being everything to everybody is a simple business with huge rewards. And few worries. Still, over the years I've amassed  large equity portfolio of equities.    Let's talk about the spectrum for a moment. Well, at least the equity portion. Up until 2003 my equity pitch went something like this: The stock market bottomed after the great crash in July of 1932 at 41. Since then it's done nothing but go higher. And, every time it's gone down, that is every time, it's come back and gone higher. Stocks need to be an important part of your portfolio.   Sounds good huh?   And it's totally true. Factually correct. The best type of material for a stock selling advisor.   However, there is a back story. It took until 1954 for stocks to reach their pre-crash level. That's 25 years to get even. For those who did hold, that's a long time. Of course it was nothing but good news for those who were fortunate enough not to have been invested during the crash and had the dough to invest in the up legs over the coming 25 years. Still, think about that, 25 years? At the time for anyone 40 years old, that was a lifetime. A lifetime just to get your money back. No growth, no inflation hedge. Just getting all the hard earned money you put in back.   Now let's spring forward to the present. I no longer use my "Stock Pitch" because it's no longer valid. The markets haven't "Always come back." They may but so far this decade, they haven't.   There is a big case to be made that the environment for stocks is changing. And, not for the better. Looking back over the past 25 years, what fueled the great stock run of that time? If you answered baby boomers you are correct. With a big lift  from the Reagan admin with the advent of the 401K. Or was it Carter? The boomers fued the great stock boom of the past three decades. Now as the boomers move to another phase of their lives, equites will play a less prominent role. Year by year less boomers are in the accumulation phase. That was coming regardless of market action. But let's look at market action. Two stock market debacles inside of 8 eight years! Many boomer's stock portfolios are reduced to 1990's levels. Especially those who bought into the "just buy the index mantra" that permeated the nineties. And again, regardless, boomers have had enough. Many have lost faith in the equity markets. That's what fraud will do. And, in that way, this time is different. Add in the governement setting aside the law and wiping out entire classes of investors, from shareholders to preferred share holders and even bond holders as they "apply the greater good" theory, and the trust that boomers had in the stock markets is left as a puddle of tears on the floor.   The combination of boomers reaching retirement age, few safe havens for investment causing a loss of faith, and much smaller follow on generations with much less buying power all are cause to rethink the "Equities always come back" equation. I personally think that equities will come back. But over such a long time period, and with a risk factor that makes them all but useless as an inflation hedge.   Yet, advisors use the same tired and outdated tools to allocate to stocks. And many have already forgotten the lessons of just a year ago.