Written by Kronos Technologies on January 30, 2019
Many advisors focus their marketing efforts on finding a continuous stream of new prospects that they can turn into clients. When successful, this is both an effective and lucrative engine for growth in their practice. But, over the long-term, a more comprehensive and integrated set of marketing strategies can actually be more efficient and produce more sustainable growth.
A healthy practice that continues to consistently grow over time does need to be fed by a steady stream of new clients—but it also needs the year-over-year predictability of maintaining and deepening relationships with existing clients. And, in order to maximize growth at the lowest possible expense, advisors should also seek to meet multiple needs for each of their top clients.
Read on to see how to implement the Acquisition, Retention, and Consumption campaigns that will help you optimize your practice.
When we think of acquisition in terms of our marketing strategies we’re really talking about how we find prospects and turn them into clients. The most effective way to do this in your practice is to build a comprehensive strategy for locating the types of prospects you want to work with and converting them into clients. And, to ensure that you don’t upset the balance of your practice, you need to find ways to implement your acquisition strategies in the most efficient way possible.
Some of the most common acquisition strategies include:
- Introduction and referral campaigns in which advisors invite their best clients to a speaking event and ask them to bring one or two other people who might benefit from the advisor’s services.
- Direct mail campaigns that highlight an advisor’s expertise and the types of services they can provide.
- Social Media campaigns that spread word of your expertise across a variety of platforms where potential prospects congregate. Although a single tweet is unlikely to turn a stranger into a client, the steady exposure of multiple social media posts over time is more likely to move a potential prospect down the funnel and make them more receptive to working with you.
- Making sure your website is professional and up-to-date, and offers potential new clients the information they need to decide to work with you.
No matter what type of acquisition campaign you decide to implement, the leys to success include:
- Clearly identifying your target market/ideal client profile
- Crafting your marketing to specifically target that audience and their needs
- Using technology (like CRMs and FNA tools) to streamline the workflow and manage activity to keep costs low and preserve time for you to spend in front of clients.
The pros and cons of acquisition campaigns
The risk involved in implementing acquisition focussed marketing campaigns is that they tend to be expensive and the conversion rate tends be low—meaning that it takes a lot of time, money and effort to find prospects, and only a few are likely to become new clients.
However, without a pipeline of new clients your practice stops growing and over time may fall into decline. In order to avoid the pitfalls sometimes associated with acquisition campaigns it makes sense to key on strategies that have higher conversion rates (such as obtaining introductions and referrals), while finding efficiencies in your direct mail and social media efforts by automating as much of the workflow as possible. You could, for instance, use your CRM’s filters and tags to help find prospects more easily, save time by using pre-defined direct mail and email templates, and streamline your workflows by using the activity management tools to book events and schedule meetings.
Customer retention is the process by which you develop deeper relationships with your current clients by providing value that motivates them to continue working with you. Doing a good job at customer retention reduces the pressure to relentlessly hunt for new clients, keeps revenues predictable and costs low.
One of the keys to effective client retention is to build a service strategy using your CRM’s segmentation tool. Identifying your ‘A’ and ‘B’ clients enables you to create customized Service Level Agreements so that you can act proactively vs reactively. Although you will, of course, offer great service to all clients when they need it, segmentation allows you to identify your top clients and implement strategies for delivering even more value to them on a regular basis.
This added value, which will help build your expertise and their trust in you, can take many forms. It may include creating a network of collateral professionals—other advisors and service providers you can introduce to your clients when a client has a need to be filled (like accountants or lawyers.) Or you may offer them value-added content in the form of blogs, articles, webinars and case studies that inform and educate about topics that are important to your clients. In many cases, advisors conduct regular seminars and speaking events for their top clients—giving them the opportunity to learn from experts in fields that they are interested in.
Always remember that the true point of emphasis when seeking to retain clients is to make sure you always meet their expressed needs. It’s no use providing awesome added value if your client is dissatisfied because their core insurance and investment needs are not being met, or they find the process confusing or frustrating for any reason.
Also keep in mind that how much emphasis you put on retention over acquisition is related to where you are in your career as an advisor. Newer advisors who are still building their client base will naturally need to be more focussed on acquisition campaigns, whereas, once you are more established a natural migration towards retention tends to occur.
For insurance and investment advisors the term consumption really describes how effectively you are able to meet multiple needs for your clients. It comes down to how many products and services you are able to provide for each client—and that means it’s a measure of your ability to cross and up-sell.
Most industry studies show that, on average, advisors only sell just over one product or service per client. This means there’s a large opportunity for most advisors to reduce costs and effort, meet more client needs and create great client experiences—and increase revenue. It’s no secret to anyone in the industry that it’s far easier and more cost-effective to sell to current clients than it is to find and convert new ones. And, meeting more needs, will positively impact your clients’ sense of the value you provide, improving client retention.
The keys to increasing consumption through effectively cross-selling and up-selling include:
- Use your CRM’s filters to identify cross-sell candidates in your client base—especially those with upcoming conversion dates and policy renewals.
- Conduct client review meetings with likely candidates and review their financial needs analysis to uncover all the cross-sell and up-sell opportunities.
- Make sure to capitalize on all of those opportunities by tracking them in your CRM and using it to manage the necessary follow-up activities.
When it comes to consistently growing your practice over the long term the best approach is find the correct blend of acquisition, retention and consumption marketing campaigns. Top advisors find cost-effective and efficient ways to bring in a steady stream of new prospects that will become clients, while constantly working to retain their clients by adding value and uncovering all their needs in order to maximize the cross-sell and up-sell opportunities. When advisors consistently are able to achieve those three marketing goals their clients are most satisfied and their practices grow at significant and sustainable rates.