In the competitive world of investment advisory, reaching a plateau in new client business development can be a significant hurdle for owners and their teams. While financial advisors excel in their expertise of managing client assets and financial planning, they often face challenges when it comes to sales and business development.
There are many common problems that hinder growth, such as a disproportionate distribution of new clients, lack of business development training, and difficulty in generating new interest. Let’s explore each in more detail:
Disproportionate Distribution of New Clients
One prevalent issue faced by investment advisory firms is that a small portion of the advisory team tends to generate the majority of new clients. This imbalance not only puts excessive pressure on those individuals but also limits the firm’s growth potential. By addressing this problem head-on, firms can leverage the collective strengths of their entire team and tap into a broader client base. Implementing a system for sharing leads, fostering collaboration, and creating incentives for successful client acquisition can help spread the workload and drive more balanced growth.
Lack of Business Development Training
While investment advisors possess extensive knowledge in their field, younger, less experienced advisors may not have received adequate training in the art of business development. This deficiency can hinder their ability to effectively prospect for new clients and capitalize on growth opportunities. Investing in comprehensive business development training programs, workshops, or coaching can equip less experienced advisors with the necessary skills to identify, attract, and ultimately acquire new clients – and for veteran advisors it can help “sharpen the saw” with updated skills and new focus on business development techniques. By bridging the gap between investment expertise and sales acumen, firms can empower their advisors to take charge of their client acquisition efforts and ultimately grow the firm.
Generating New Interest
The ability to convert a prospect to a client is a valuable skill, but without a consistent stream of new leads and prospects, growth becomes stagnant. Investment advisors must proactively generate new interest to expand their client base. By focusing on key areas such as prospecting, client referrals, building relationships with external influencers, and adopting creative marketing strategies, advisors can cultivate a pipeline of potential clients. Embracing digital marketing techniques, hosting educational events, and leveraging social media platforms can amplify the visibility of the firm and attract a broader audience.
Strengthening Key Business Development Skills
If a team is facing any of these types of issues, there are many areas on which they can focus to begin building their skillset and approach to new business development—resulting in new skills that can revitalize their client acquisition strategies and contribute to the overall growth of their firm.
- Prospecting
The ability to seek out and engage potential clients is fundamental to expanding one’s book of business. Advisors should refine their prospecting techniques, identify target markets, and develop effective outreach strategies to generate meaningful leads. - Client Referrals
Word-of-mouth recommendations are powerful tools for attracting new clients. Advisors should cultivate strong relationships with existing clients, provide exceptional service, and actively seek referrals. With strong client referral strategies and systems in place, advisors can leverage satisfied clients as brand ambassadors and extend their reach and tap into new networks. - Generating External Referrals
Building relationships with centers of influence, such as attorneys, accountants, and other professionals, can significantly expand an advisor’s network. Collaborating with these influencers, participating in industry events, and offering value-added services can position advisors – who might not yet currently have an existing referral skillset or strategy in place – as trusted partners and sources of expertise. - Marketing Ideas to Generate Opportunities
Investing in creative marketing strategies can help advisors stand out in a crowded market. Developing a strong online presence, publishing thought leadership content, leveraging email marketing campaigns, and utilizing targeted advertising can all contribute to generating new leads and opportunities. - Prospecting Follow-up Discipline
Consistency is key when it comes to converting leads into clients. Advisors should establish a disciplined follow-up process, which includes timely communication, personalized touchpoints, and regular follow-up to build trust and convert prospects into long-term clients.
Addressing the problems behind a plateau in new client business development is crucial for investment advisory firms to sustain growth and thrive in a competitive landscape. By recognizing the challenges of disproportionate client distribution, lack of business development training, and difficulty in generating new interest, firms can take targeted steps to bridge these gaps.
Investing in training programs, fostering collaboration among advisors, and implementing creative marketing strategies can significantly enhance their prospecting abilities, client referral networks, and external influence referrals.
By strengthening these key business development skills, investment advisors not only develop their own books of business but also contribute to the overall growth of their firms, positioning them for long-term success.
Ultimately, the key lies in recognizing the importance of sales and business development skills alongside investment expertise. By embracing a holistic approach that combines financial acumen with effective client acquisition strategies, investment advisory owners can unlock their firm’s growth potential, expand their client base, and establish themselves as industry leaders.
With a commitment to continuous improvement and a focus on these critical areas, investment advisory firms can overcome plateaus, drive sustainable growth, and thrive in an ever-evolving marketplace.
If your team is experiencing any of these issues or would like to explore ways to begin sharpening your business development skills, contact Pohl Consulting & Training.
We have decades of experience helping financial firms navigate their way through business growth strategies, offering sales development workshops to address skill development. Contact us to learn more.
