Anyone who has experienced a bad blind date knows the risk of being too vague in describing the qualities you expect in your ideal partner.

Yet, according to Gail Wiebe, head of training and development for DundeeWealth Inc. in Toronto, some advisors continue to make the mistake of being far too general in profiling their ideal client. Attempting to focus on dual–income couples with a net worth of $500,000 and a long-term investing strategy is just as misguided as seeking a “special someone” who likes candlelight dinners and long walks on the beach.

“The ideal client profile,” says Wiebe, “needs to be very specific, so that when you sit down with someone and say, ‘This is the type of client I’m looking for,’ that person can picture the client in his or her mind. It should be that descriptive.”

And putting together the profile of your ideal client should be considered an essential part of the business planning process, she says. As with a lot of good ideas, however, this is sometimes easier said than done.

“Nothing is black and white in this industry,” admits George Hartman, a coach with the Covenant Group in Toronto. Even among those advisors who have clearly defined their ideal client, it’s a very rare advisor who can stick entirely to a client profile and never waver.

Circumstances — a referral from a favourite client is a good example — can blur the line between ideal and not so ideal, he says. While a grey area may be acceptable for an advisor just starting out in the business, established advisors should have a very clear picture of the clients they want.

“One of the most incredible advantages to being an advisor is that, ultimately, you get the chance to choose the people with whom you want to do business,” Hartman says.

That seems to bear itself out in performance: the more successful an advisor, the more likely he or she has developed a clear client profile. According to Advisor Impact Inc. in Toronto, 68% of advisors say that they have an ideal client profile, which includes such factors as investment assets, income, profession and/or personality type. Among top producers, the figure climbs slightly, to 73%. However, Julie Littlechild, founder and president of Advisor Impact, says, even those advisors who have a solid idea of the type of client they want waver from time to time.

“It’s a real challenge for an advisor to say, ‘This is the kind of business I want,’ and, if a client doesn’t fit, walk away,” she says.

But, according to Hartman, there are some dramatic changes on the horizon that could affect how diligently advisors stick to their ideal client profile. As the number of working advisors decreases as the advisor population ages and retires, those interested in using their time profitably will have an even more critical need to stick to their business plan — whether that involves segmentation by service levels or drawing up an ideal client profile.

“If I were an advisor 10 years from now, I would want to be very selective about whom my clients are,” Hartman says.



Here are some factors to keep in mind when trying to sum up — or revise — the profile of your ideal client:

> Pick Your Favourites. Look at your current client roster and analyse your top clients, not simply by assets under management and other financial measurements but also by chemistry.

“You should think long and hard about why you enjoy that relationship,” Littlechild says.

Is the relationship built on mutual respect? Is there a shared outlook on what’s important when it comes to money?

“Values are one of those fuzzy concepts that people don’t like to talk about very much, yet they drive much of what we do,” Hartman says. “That’s especially true when it comes to building long-term relationships with clients.”

> Look Closely At The Clients Who Don’t Make A Positive Impression. What is it about their personality, style or attitude that rubs you the wrong way?

Wiebe recounts the story of an advisor who had lost much of his enthusiasm for the business after only five years in the industry. She says the problem lay with the way his business had evolved: his ideal client profile had shifted considerably without him being aware of it.

@page_break@Initially, he had built up his business by targeting oil industry execs from his former line of work. But it turned out that he felt no connection to these clients, who now made up the bulk of his book. Instead, he preferred his widowed clients.

“He had to look at restructuring his practice in order to rejuvenate and recreate that excitement that had been lost,” Wiebe says.

> Know Your Deal-Breakers. Advisors need to be very honest with themselves — and their clients — when it comes to the traits that they will not accept in a client, Littlechild says. Do they share the same investment philosophy? Are they willing to invest all of their assets with one advisor?

“There should be either a ‘yes’ or ‘no’ answer to deal-breaker questions,” she says. If there is a range of acceptable responses, that’s a clue that the characteristics in question should factor into your client-segmentation strategy rather than remain an element of your ideal client scenario.

> Test The Ideal Client Profile. “When an advisor builds an ideal profile, he or she should run it by the team, run it by the family, run it by his or her friends,” says Wiebe. “When you describe this person, does it actually create a picture in their heads?”

It’s important to do this before revealing the profile to clients and centres of influence, she says, because it will give you the opportunity to zero in on factors that best illustrate the type of client desired. The more accurate the description, the less likely a client or another professional will recommend a bad fit that could potentially jeopardize the initial relationship.

> Specialize And Deliver. While many advisors might recognize the importance of creating a profile of the ideal client, they tend to think of it as a marketing tool to help generate leads and referrals, says Dan Richards, president of Toronto-based Strategic Imperatives Ltd. But they should be taking it a step further, he adds, by wrapping their business plan around the profile and creating unique services that make sense to these particular clients.

In other words, don’t bother creating a specific client profile if you’re going to turn around and provide these clients with a plain-vanilla practice, Richards says. You need to make sure you deliver superior and distinctive value to these clients in order to stay competitive.

> Capture Your Profile. Once you have tested your ideal client profile (or profiles, because an advisor might, for instance, target seniors and their children), print up a brochure or document that describes it as clearly as possible, perhaps with visual cues, suggests Wiebe. Leaving these with clients and professionals can help build your business.

> Stick To It. If you find yourself making exceptions to your ideal profile too often, you’ll be no different than the dieter who makes an exception “just this once” several times a day, and then wonders why weight loss is so difficult. Exceptions can occur — when a favourite client refers a family member to the practice, for example — but too many exceptions will sabotage the business plan.

Littlechild says there is a way to deal with this too-flexible approach to building a business. When a client makes a referral that you really don’t think fits your business plan, you can say “No thanks” courteously and professionally.

Thank the client and explain that there is a possibility this person won’t need the kinds of service you deliver.

“The advisors I talk to feel better about that process if they position it with the client right up front,” Littlechild says. IE