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1. Understand your business and clients

There's too much sameness in the financial advisory business, Sofia explains. Too many advisors copy successful firms' strategies and tactics with the hope of replicating their success. A better approach is for an advisory firm to consider its own motivations and competitive advantages. It's an in-depth process that can benefit from third-party coaching, he says, but it's worth it “because most advisors, if you ask them what makes them different, will tell you something that every other advisor will tell you.”

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That same review process can help identify better prospects and clients. Swift cautions that trying to adapt to every client and match their philosophies will backfire because the prospect or client will sense the lack of genuine identification. She encourages advisors to instead develop mission and vision statements and then identify their ideal client. Profiling desired clients clearly “will keep you to the plan of courting those particular people instead of the universe of people in your community or neighborhood,” she says.

Reviewing existing clients can reveal valuable patterns, says Sofia. The advisor might learn that a good percentage of his clients are C-level executives, widows or some other identifiable group. That information can reveal an unrecognized market expertise and advantage, which in turn provides a foundation for building a prospecting strategy.

Scoring system to rank clients and prospects

That's the approach New York City-based Lenox Advisors Inc. took several years ago. The firm's partners developed a scoring system that would help them rank clients and prospects, says partner Tom Henske. The process led to the realization the firm “wanted clients that were young, making a good amount of money, laser-focused on their work and didn't have a lot of free time to do their own planning — all the things that make us, as financial advisors, relevant,” he explains. Wall Street executives fitted the profile perfectly and that cohort became the core of the firm's clientele.

Other advisors use different characteristics to define their target markets. Randy Scritchfield, CFP in Damascus, Maryland says his clients are usually age 55 or older and planning for retirement or already retired. He doesn't use income or investable assets as the most important features in client selection; his segmentation is more subjective. He divides prospects into three categories: do-it-yourselfers, collaborators and delegators. He won't work with the first category, will consider the second and prefers the third. Delegators, he adds, are the “ideal client.”

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2. Plan your messages

Identifying your target market is a critical first step, but how do you connect with them? Swift advocates what she calls the three M's: market, message and media. The message must resonate with the market and reach them in a way that will attract their attention. She uses the example of a funnel. At the top of the funnel prospects become aware of your possible role as a resource and start to consider your services. Ongoing communication — drip marketing — can help move these prospects down the funnel, even if they're not ready to commit to working with you yet. “And, as they come down that funnel, they're finally going to end up in, ideally, this bucket called decision-making,” she says. “(Here) they're doing their due diligence about their decision, checking you out online, talking to friends and family, other people that you may refer them to, checking with their other professional advisors.”

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It's critical to avoid generic messaging when communicating with prospects, says Sofia. An unfocused message will not resonate with the target market and moving a prospect from cold to warm status requires creating empathy. The only way to do that is to understand the market and express that understanding in your communications. “Every piece of copy that you write and every page on your website, should be focused on one audience,” he says. “So when those people get plugged into your pipeline their immediate sense is that you know them, you get them. That's the first step to warming somebody up.”

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3. Consider customized approaches

Potential clients respond differently to different communication methods, Swift notes. Consequently, what works for one group — seminars, for instance — won't work with another target market. In some cases, it's necessary to take a different approach to get in front of prospects. She cites physicians as an example. Doctors are often unlikely to attend an event you sponsor off-site, but if the advisor can land a speaking opportunity in front of a hospital's employees, that event is more likely to draw prospects. In contrast, prospects with more free time may respond better to community events. “Those folks may respond better to social and charitable events where they would be happy to come to a charitable golf outing or to put on a hardhat and do a Habitat for Humanity build because they're all about community stewardship and family stewardship,” she says.

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Sofia shares a hypothetical example in which many of the advisor's targeted clients live in a gated community, perhaps a golf and country club. Advertising in the community's periodicals or their golf tournament announcements will help build name recognition among the residents. If an advisor knows the schedule of a retiree group she's targeting, she could schedule an educational event around the prospects' schedules.

For Lenox Advisors, that realization led them to provide group benefits through their prospects' employers. Henske estimates that 60% to 70% of the firm's marketing is worksite-based. As providers of one or more of the company's group benefits, Lenox Advisors staff members meet one-on-one with employees to discuss their benefits, which allows the firm to build relationships early in the employee's career.

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4. Stay in touch

Message frequency is another factor to consider. Henske says that clients' and prospects' rank on an A, B, C scale, (A being the highest) which influences the number of contacts received from the firm. C-clients and prospects might receive six contacts per year, for instance, consisting of several newsletters and an annual review meeting for clients. A-levels could receive up to 24 communications annually plus invitations to client events and other personal touches. More contacts cost more, but it's worth it, he says because “you're basically helping to solidify the relationship with that person and thus getting referrals to friends and family that tend to be in the same economic stratosphere as that individual.”

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Scritchfield says one of his most effective messaging tools is a market commentary that he emails every Tuesday. It puts his name in front of prospects at least 52 times a year; clients typically receive 70 or more contacts, including the emails. The frequent communications increase the likelihood prospects and clients will think of him when they need financial advice. “So, when you want a second opinion on what you're already doing, when you have a CD come up for renewal, when you change jobs and have an opportunity to roll over your 401(k), it's very easy because my name is in front of you on a weekly basis,” he says. “It's very easy just to hit reply and say, hey Randy, give me a call.”

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5. Be consistent

Sofia reports that on average it takes seven interactions with an advisor's brand before prospects convert to clients. Those seven interactions can take place across multiple media, however, and Sofia strongly advocates cross-channel messaging. “Maybe once is an email, once is a video, once is on social media, once is through a traditional advertising source like an ad or a billboard, once is through an event, once is through a piece of thought leadership,” he says.

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It's important that the message remains consistent across the channels, he stresses. Swift also believes the message and media need to remain focused. If a prospect visits an advisor's website, for example, she says the experience should be one of “a professional, cohesive brand.” It's about building credibility and convincing prospects that your firm is the best resource for their needs, she maintains: “Keep that in mind and make sure everything is consistent and clean and simple.”

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