■ A good friend of a client has just inherited a large amount of money and needs the help of a financial professional to preserve it.
■ A friend of a client is just about to retire and will receive a $500,000 lump-sum distribution from his retirement plan. He needs a money manager for the first time in his life.
■ A local corporation, where a client was previously the CEO, is down- sizing. He identifies 1,200 people who will soon receive over $200,000 each in lump-sum distributions.
■ A friend of a client has just taken his company public, thereby increas- ing his net worth. This friend wants to prudently diversify his wealth and needs an advisor to help him do it.
■ A client’s colleague is selling his $2 million house and wants to be shown how to avoid capital gains tax by using a charitable remainder trust.
■ A client’s relative is a wealthy small-business owner who wants to transfer his business to other family members without the government taking a huge chunk out for taxes. He wants to find out how a family partnership might solve this problem and how to get the rest of his financial house in order.
This system of cloning your best clients will allow you to easily double the total number of clients in your business, thereby doubling your income. And you can continue this process as long as you’d like. If you don’t have existing clients or your favorite clients are not in the marketing niche that you want, then call on certified public accountants (CPAs) or other centers of influence who are in that target market and do the same exercise.
to do. If you do not have a client base from which you can clone your desired target market, or if you are new to the business, we recommend that you hold small workshops on a monthly basis. This should be the same basic workshop each month, allowing for constant improvement as you move ahead.
Phone Call Follow-Up Stage
If your workshop is on a Thursday, don’t wait until Monday to begin mak- ing your follow-up calls. Start the day after or, better yet, the day of the event. Make contact with everyone within three days. Before calling a prospect, be sure to go over his/her response sheet so that you have a good idea of the type of person with whom you are talking. When you make your first follow-up call, make it clear that the meeting you hope to set up is part of the investment consulting process—and, as you promised in the work- shop, you are willing to put together an investment policy statement cus- tomized to this person’s situation.
Converting Existing Clients 195
FIGURE15.2 Introducing the Concept of Separate Account Management.
The Workshop
Built into each workshop is a call to action that creates excitement and moti- vates participants to want to personally meet with you after the workshop.
We offer participants something that usually only the largest pension plans provide—an investment policy statement that addresses each person’s own unique objectives and spells out exactly what we would do if we were in his/her shoes. Our strategy is to create a win-win situation. We do this by teaming up with a good speaker who has the same target market and who will share expenses as well as help promote the workshop.
Depending on your target market, the ideal time for workshops will differ.
For retired individuals, days are best; for executives, evenings or Saturdays work better. We have been very successful with Saturday morning workshops that run from 9:00 to noon. We have greeters hand out nametags and address cards for each attendee. We have the attendees check the registration mate- rial for accuracy. Having the wrong address for a prospect at this stage is not a major disaster, because he/she will correct the mistake, but letting the wrong address go uncorrected can be as bad as having no address at all. The registration personnel also hand out seminar workbooks.
It is a good idea to have at least two people speaking and to schedule a refreshment break between speakers. The break gives people a chance to approach and talk with the presenters. In fact, presenters often find them- selves surrounded by people with questions. It is a golden opportunity to make personal contact with those attending the seminar. Obviously, it is important for the presenters to be relaxed, friendly, and sincere.
Explaining the Separate Account Management Process
The last part of the seminar process involves getting those in attendance to want to have an investment policy statement or statement of objectives written for them. You can have participants complete a response sheet. The aim of the response sheet is not to grade how well you did, but to determine what partici- pants liked, what they didn’t like, and most important, to find those who desire a complimentary follow-up meeting that will result in an investment policy statement. Prioritize the follow-up request forms. We give the participants the opportunity to mark yes, maybe,andno.If they mark no,we don’t call them.
The Presentation
In the workshop, your presentation should start with addressing the audi- ence’s values. Start by telling participants that the four most powerful 196 THE DELIVERY SYSTEM
words in the English language are I need your help.Then ask, “How many of you are confused about investing?” (Show of hands.) Pause and tell everyone to look around; almost everyone in the audience should have raised a hand. Make sure that you give them time to respond, and then acknowledge them. Then say, “If you’re not confused about investing, you’re not paying attention.” That should get a chuckle and help them begin to see what is in it for them; you are going to help them through all the con- fusion in the investment arena.
Next, try to determine the level of sophistication in the audience. Ask how many in the audience consider themselves to be sophisticated investors.
(Show of hands.) Typically in groups of 30, we have one fellow in the back of the room raising his hand defiantly. That person is likely to be your biggest challenge. Then say, “Let me share with you our definition of a sophisticated investor: someone who has lost money at least once and did not enjoy the experience. Now, how many of you are sophisticated investors?” (Everyone raises a hand.) It’s a very powerful method to get people involved in the process.
Outline the key concepts of separate accounts, and illustrate the building- block approach. This is a very powerful way of introducing separate account investing.Throughout the presentation, mention the various steps of the invest- ment management consulting process, and reiterate the importance of the investment policy statement. By the time we’re ready to close the workshop, attendees are extremely comfortable with the thoughtful discipline of not only our investment approach, but also the process we use in working with new clients. Ask the audience to check off on a response sheet whether they would like a complimentary personal investment policy statement prepared individu- ally for them.
Don’t judge success by the number of people in the workshop. Don’t judge success by the number of people who check off that they want to meet with you. Judge success by the real results you achieve—new assets under man- agement. In most cases, groups numbering between 10 and 30 have been the most successful.
Promotion
Promotion basically consists of both relationship marketing and direct mar- keting. Let your clients know that you are holding monthly workshops and that their colleagues and friends are invited to attend. If your clients perceive that the process you use to work with new investors is consistent and high in Converting Existing Clients 197
quality, they’ll be comfortable giving you the referrals for which you ask at each quarterly meeting.
In addition, when you are getting started, it can be advantageous to con- duct a very targeted direct-mail campaign. You might be tempted to simply run a newspaper ad, but you may find that doing so does a better job of hav- ing competitors attend your workshops than qualified prospects. Teaming up with a radio personality who runs the top local financial show can be success- ful. If you are just getting started and don’t have existing relationships, this might be something to consider. Think about how you prefer to be contacted and you will begin to understand why teaming up with a CPA or other finan- cial professional can greatly enhance your success.
The most successful workshops that we’ve done were sponsored workshops, rather than public workshops. We enlist another organization to cosponsor the workshop, such as a charitable organization or professional association.This not only reduces costs dramatically, it provides a foot in the door to their specialized donor or client lists. Choose the association or professional organization wisely, however, to make sure that it is consistent with your ideal client profile.