Top advisors power their growth by taking a careful and disciplined approach to new business. This intelligence, corroborated by our firm’s study of the characteristics of practices that outgrow the industry average by over 200%, suggests that to attain your business development goals, you must stop being a seller, and start being a buyer.
In a previous WealthManagement.com piece, I discussed the necessity of leveraging the four key characteristics of a successful practice to attract prospects—leadership, new net assets, a client service model and financial planning/asset management expertise. If all of these attributes are already hallmarks of your business, then you have earned the right to decide which prospects become clients—not the other way around. When you raise the bar for the minimum requirements prospects must meet, you should see a shift in the ratio between clients you say “yes” to and those you politely turn down.
So, how do you shift from being a seller who chases prospects to being the buyer in full control of the decision-making process for accepting new clients? Here are four tips to keep in mind:
Create and manage a pipeline of potential clients.
When developing a pipeline of new business, disciplined selection and diligent contact maintenance are crucial. An organized and easy-to-navigate database for new business is essential for qualifying new leads and nurturing them, as well as for forecasting future business—so you need to keep your pipeline up-to-date with new leads, accurate contact details, notes on outreach, and other pertinent information. Without a refined selection process and an efficient system for tracking prospect engagement, your firm will waste valuable time and resources on prospects who are either unqualified or undesirable for your practice.
Establish a profile of your ideal client.
Identify the qualitative and quantitative characteristics of the clients best-suited for your practice. Think of your most successful client relationships—what separates them from the rest? Do they follow your advice? Do they participate in your events? Are they centers of influence in your community? What is their average net worth? Which professional industries do they typically work in? Do they refer new clients?
When developing this profile, don’t underestimate the value of collaboration and feedback from other team members. Multiple perspectives can bulk up profiles of ideal clients with a greater number of meaningful details and essential qualities—making the finished product even more useful. Ensure you have a thorough understanding of the traits your ideal clients possess, and train every member of your team to assess prospects based on these characteristics and qualifications. Painting a clear picture of your perfect client will also help facilitate referrals, as we discuss below.
Let your prospects know you are selective but also open for new business
To truly make your exclusivity a reality, people need to be aware of it. From the outset, share the profile of your ideal client with your audience—including current clients, prospects and centers of influence. Let them know that while you are actively seeking new clients, you only accept a limited number that closely fit your criteria. In addition to defining your business as selective, this also ensures that your current clients come first and reassures them that they will not experience a shift in service due to business development efforts.
While exclusivity gives you the power to control the caliber of clients you work with, it also underscores that your practice might not be the best fit for everyone, and vice versa. To be a successful buyer, you must value quality over quantity and be willing to politely walk away.
Ask for referrals right from the start.
Identify prospects that you think your current clients may know, and kindly ask for specific introductions. It is imperative that you ask the referral source if he/she believes a specific prospect would be a good fit your practice based on the criteria you have shared. Essentially, you are asking your client for sound advice and most people will be flattered by this request. In addition to giving you a better idea of a prospect before you begin a personal assessment, engaging the client in this way enables you to gauge how well he/she understands your business and values. Referrals are often the best sources of targeted, and potentially more qualified, leads—so don’t be shy. Ask for referrals at the beginning of your relationship with each client. But be specific!
In the long term, prospects that are simply available and willing to retain your services, but do not otherwise fit your profile do not drive disciplined growth. You will only build and run the business you desire if you pursue clients that are the right fit for your practice. In other words, approach new business like a buyer, not a seller.
Michael Parker is National Director, Enterprise Development for Hightower Advisors.