Tampa: “I feel that we're continually asked to cull the bottom of our book,” says Sean. “But what do you consider to be the ideal number of clients for a 21st Century financial advisor?”

Sean was honing into the heart of what has become an essential issue for anyone serious about attracting, serving and developing loyal affluent clients: What is the ideal number of clients a financial advisor can properly serve? There is frequently a companion question that accompanies this discussion: “How many contacts do the affluent want during the course of a year?”

In order to answer these questions, one needs to have a thorough understanding of the affluent. Too many financial advisors want quick simple answers, solutions that require little thought or change and minimal effort. But this is wishful thinking.

Indulge me for a few moments while I address Sean's question. Before I can offer a sensible response, I needed a working knowledge of critical components of his practice, and how it operates. One of the critical components I asked Sean to describe was his “client coverage model.”

It was not intended to be a trick question, but it does stump many advisors. And it stumped Sean. Why? For the simple reason that he, like so many of his peers, had yet to fully establish or commit to a particular client coverage model. Make no mistake about it — this is a core issue for every advisor serious about attracting, serving and developing loyal affluent clients.

Think about this discussion for a moment. The real question shouldn't be, “What is the ideal number of clients I should have?,” but rather, “How many clients can I properly serve?” In order to bring this question down from 35,000 feet back to earth, you might find it helpful to think in terms of client coverage and client service.

Obviously your best clients will require a different level of coverage and a higher level of service. Although service is inextricably linked to coverage, I am going to table “service models” for another time. At this moment, I want to keep your focus on coverage. Answering the following questions will help you address what we consider to be the four basics elements of a client coverage model.

Basics of Effective Client Coverage

  • Who is covering whom?

    Basic #1-Every client must have a team member who is responsible for managing that relationship.

  • What type of coverage is being provided?

    Basic #2-A clear and specific type of coverage should be assigned to each individual client.

  • What is the frequency of coverage?

    Basic #3-The expected frequency relative to the type of contact should be determined for each individual client.

  • What is the expected result?

    Basic #4- Clearly defined objectives should be established, such as client loyalty, center-of-influence penetration, additional business and exceeding client expectations. Also, a monetary value should be assigned to each client.

Most likely you've already concluded that in order to have a fighting chance of developing an effective client coverage model for your business, everyone on your team or in your practice must be prepared to roll up his or her sleeves. Hard work is required if you are going to seriously commit to executing these basics. However, and this is really a blinding statement of the obvious, no one individual has to be the point-person for every client in your practice, and this includes you. Whew!

Getting back to Sean, if you thought that he had too many clients, you thought right. His first step, and it might be something you should consider, was to thoroughly re-assess his client base. Sean agreed that he needed to take an inventory of every single household on the books — and this went beyond his firm's client segmentation data. Your firm can assist — they can segment by products, tools, assets, revenue, and services — but they cannot provide the subjective analysis. Is this household a center-of-influence? Is there upgrade potential? In this manner, a true Client Contact Model is personal, both for you and your clients.

Writer's BIO: Matt Oechsli is author of Building a Successful 21st Century Financial Practice: Attracting, Servicing & Retaining Affluent Clients. oechsli.com