Greensboro: "We've culled our book, but I still find myself getting bogged down with clients that are below my firewall -- I'm most effective as a rainmaker, not dealing with smaller clients," explained Joseph during a break at our Rainmaker Weekend.

I'm a plain-spoken individual by nature, which (usually) has been an asset during my years of coaching financial-service professionals. After all, financial planners (usually) don't hire me to massage their egos, but to provide honest answers and "tough love" solutions. Sometimes, however, even I go too far with the "plain speaking."

After a bit of probing, I discovered that Joseph is a soon-to-be rainmaker who had pumped eight new affluent clients into his pipeline during the previous 12 months. Problem was: He'd also lost three major clients during the same period.

After reviewing his situation and listening to his tale of woe, I finally burst out, "You're hemorrhaging affluent clients because they probably think you're more sizzle than steak. You've got too many small clients, your affluent clients probably think of you as a stockbroker not a wealth advisor. You have to show your affluent clients your full menu of financial services -- before and after they sign on. And you must re-engineer your client base."

Unfortunately, Joseph's case is not unique.

In a recent study of wealth-management teams commissioned by the Oechsli Institute, we learned that:

  • 49% of teams did not lose any clients during the previous 12 months, because of their best efforts to retain them.
  • 15% of teams did not lose clients during the previous 12 months, despite inconsistent and inadequate efforts to retain them.
  • 36% of teams lost one or more clients during the previous 12 months, because of inconsistent and inadequate efforts to retain them.

By the way, death, relocation and factors beyond the control of the respondents did not count as "losing" clients.

In some cases, client losses occur because team leaders or senior partners take responsibility for "bringing home the bacon," but then abdicate responsibility for maintaining good relationships. In other instances, financial advisors (like Joseph) lose clients because they fail to inform them of the range of services they can provide -- until it's too late.

The key to building a client-centric practice is not just an adequate service menu combined with great client service, but consistently letting your clients know about all of the above.

Many advisors claim to have client-centric practices, but the fundamental difference between the "average" and the "client-centric" practice is that the latter really "walk the talk." They deliver on all their promises. They are truly committed to serving clients, have a workable number of clients, and provide a consistent experience. They have procedures, policies and systems that are geared toward delivering high-level, comprehensive wealth management to every client -- on a personalized basis.

Everyone targeting affluent clients is convinced they have the right mix of products and services. Some truly do, and their clients agree. Others mistakenly think that any mix that targets high-net-worth people will do.

Your wealth-advisory package is the mechanism through which you identify the need for and deliver the appropriate financial solutions. When affluent clients are involved, those solutions go far beyond asset-allocation advice and managing investments. Our research shows that at any given time, you could be called upon to deliver solutions for any of the following:

  1. Budgeting, cash-flow management, and determining net worth
  2. Banking services
  3. Insurance planning
  4. Asset and investment management
  5. Education planning
  6. Tax planning
  7. Retirement planning
  8. Charitable giving
  9. Long-term care
  10. Estate planning

To integrate these into your mix, you must be able to do the following very well:

  • Maintain a high level of proactive interaction with each affluent client.
  • Explain clearly, and on a timely basis, the products and services you believe would be appropriate for each of the areas listed above.
  • Explain how each product and service integrates with the others.
  • Be familiar enough with each client's needs to know when to bring in a particular specialist.
  • Form strategic partnerships with other skilled specialists, and establish the right type of working agreements and compensation arrangements with them.

There's a good chance you already do most of this, but probably not as systematically and consistently as you could. Having a clearly defined wealth-advisory mix enables you to consistently quantify, demonstrate, and communicate your value. That's what earns client loyalty. Joseph was probably more capable of providing assistance than the person who replaced him, but he failed to communicate his service menu and his process for delivering what his clients wanted.

It is essential that your affluent clients understand the comprehensive nature of your role. They must see how the financial advice you give them reflects back to previous financial decisions and establishes a framework for helping them in the future.

If you want to cross reference the services you are providing with our research, download a FREE copy of our Service Request List. This document allows the client to review and identify the services they have an interest in discussing with you -- and will assist them in understanding the totality of the services you provide. Be prepared to discuss the services listed or to bring in an expert who can. This document can be used in hard copy or electronically.

Once again, we want to thank all of you who have emailed comments and questions to us. We will continue to do our best to answer each one. If there is a topic you would like covered, or if you have any special requests, please contact Rich Santos, publisher of Registered Rep. and Trust & Estates magazines, at rich.santos@penton.com.