The Fact:
On average, advisors paid $137 to attract a new client in 2001 and $229 if referrals are excluded from the equation.

The Implications:
The cost of acquiring a new client is not currently excessive. In fact, the cost of managing that client annually is likely in excess of the acquisition cost. It is important, however, for advisors to track this cost on an on-going basis and to understand the return on investment in marketing activities.

The Idea:
While it is important to understand your overall return on investment in marketing activities, it is more important to understand return for each activity. In this way you can get a clear sense of the effectiveness of different marketing tactics and then plan accordingly. You can analyse return by creating a simple spreadsheet for each marketing activity. For example, if you are running workshops, track the number of invitations sent, the cost of the event, the number of attendees, the number of meetings set based on the workshop, the number of new clients and the total assets brought in by those new clients. You may need to wait for up to a year in order to assess real return as the sales cycle for some clients is longer.

The Next Step:
The Business Success Kit provides you with the tips, tools and templates that you’ll need to enhance practice productivity and profitability. It’s the most practical and comprehensive guidebook available for financial advisors. For more information, visit www.caifastore.com and click on the Business Success Kit.