FOR ROOKIE ADVISORS, making contact with potential clients is key in building your business. Making meaningful contact with prospects requires a carefully laid-out networking strategy.
Your first step is to understand that there is a lot more to networking than handing out business cards.
If you aren’t seen to be offering something meaningful in exchange for a prospect’s business, your networking attempts probably are doomed. You can’t simply walk into a room full of strangers – or virtual strangers – empty-handed and expect them to sign on as your clients.
So, if you’re planning to go to a luncheon or some other networking event, take something along with you that can be passed on to potential clients – perhaps a copy of an article outlining the advantages of RESPs, paying off a mortgage faster or investing in emerging markets.
“What tends to happen [at networking events] is people exchange business cards, but there’s no value,” says Kevin Toney, marketing coach with Primetime Promotions in Winnipeg. “Take something that will make you stand out instead of handing them a business card that they’ll put in their pocket and forget about. If people see that you sincerely care about their issues, they’ll return that [interest] by giving you the chance to make a presentation.”
Peter Merrick, president of MerrickWealth.com in Toronto, agrees: “Don’t be a ‘chirping bird.’ A lot of people walk around saying, ‘Feed me, feed me.’ But they don’t offer anything in return. The law of reciprocity says: ‘Don’t show up at somebody’s door expecting them to feed you. Have something of value for them’.”
Merrick takes that idea one step further: if you have nothing to offer in exchange, he says, you shouldn’t even bother showing up because you won’t have a balance in the “emotional bank” of prospects.
“It’s all about human interactions,” Merrick says. “They won’t care what you have to offer them unless they know you care about them.”
For example, if you find out that a prospect’s wife is a huge fan of Barbra Streisand and you have access to tickets to the singer’s next concert that include a backstage meet-and-greet before the show, that small but meaningful gift just might tilt the scales in your favour.
“If you come through,” Merrick says, “the prospect’s wife is likely to tell him he’d better do business with you – or else.”
One of the first things prospective clients will look at is your professional designations, Merrick says. So, make sure you have the qualifications that your prospects are looking for in an advisor. Merrick recommends earning a certified financial planner designation. “It tells your prospects that you’re committed to the profession,” he says.
Perhaps more important than the initial contact is your followup. But that can be difficult when your contact-management system is a stack of business cards held together by an elastic band.
So, when you return from an event, Toney recommends, enter the information from prospects into your contact-management system.
“You’re going to collect business cards and email addresses, and you need a place to store them where you can find them quickly,” Toney says. “Many advisors don’t have a system to track and store all the data. Without that, you can’t have a good followup system.”
Choose your networking events carefully. Running off to random events is not an effective way to network. Toney recommends taking the time to determine your “ideal client” profile first.
Make a list of the characteristics of the type of person you would most like to work with as a client. Then, figure out a strategy to get in front of people who fit that profile.
“If you want young families [as clients],” Toney says, “you need to go to events at which a lot of young moms and dads are hanging out. The more focused you are, the more successful you will be.”
Going after friends and family members as clients might be a little awkward, Toney says, but they’re an obvious starting point. He recommends sending them all a letter telling them about your new profession.
“I’ve heard stories,” he says, “of people who have invested with others because they didn’t know their friend or family member was in the financial services business.”
When Rob Tetrault, an investment advisor with National Bank Financial Ltd. in Winnipeg, got his start five years ago, he decided to avoid trying to be all things to all people.
“Instead of doing a million events,” Tetrault says, “I try to do three a month with small groups of eight to 10 people. I might do a pre-Winnipeg Jets game party at the Manitoba Club. The networking I do is targeted and focused.”
Tetrault also decided early in his career that he would try to capitalize on his background and his own experience. Tetrault, a francophone and a former corporate lawyer at a major firm, contacted several lawyers he had dealt with before changing professions. He also started presenting seminars and holding events tailored to francophones.
“The francophone community [in Winnipeg] is small,” Tetrault says. “Somebody always seems to know my dad or my grandfather. That makes for less of a barrier for cold-calling.
“Find your competitive edge,” Tetrault advises, “and try to take advantage of it.”
While Tetrault doesn’t envy rookie advisors today, he believes they will have an “amazing” opportunity to pick up business next year, when the second phase of the client relationship model (CRM2) kicks in and fees are disclosed on client account statements.
Tetrault expects many clients will be looking for new advisors when they find out how much they have been paying in fees.
“If [new advisors] are hungry to market themselves,” he says, “they should be able to scoop up some [other advisors’] angry clients.”
Merrick says one of the most powerful tools a rookie advisor can use is persistence.
“Most people don’t say yes until the fifth approach,” Merrick says. “But 92% of advisors quit by the fourth. That means 8% of advisors are getting 80% of the sales.”
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