1. Use Surveys to Boost Center-of-Influence Referrals By Julie Littlechild Client surveys not only strengthen your bonds with clients, they can be used to cement ties with strategic alliance partners. See how sharing survey data and conducting joint surveys with CPAs and estate attorneys can lead to more qualified referrals.It's a fact: client surveys help you build relationships and increase revenue from existing clients. But you might not realize that gathering feedback can also help you make inroads with the CPAs and estate attorneys with whom you hope to work. There are three specific ways to use client survey data with your centers of influence. Each opportunity demands increased effort but delivers increased returns. We'll start with the most basic and move to the more advanced.Opportunity 1: Reinforce the value you deliver to your clientsCenters of influence worry about
referral risk
—they're concerned that clients will either receive bad advice or poor service. The traditional approach to mitigating that risk for COIs is to tell them about the service you provide and offer up some client testimonials. While this approach certainly can't hurt, it is hobbled by a clear lack of objectivity.Action: Share a summary of the survey results with your COIs. While you need to be careful not to publish the results of a survey, most compliance officers are comfortable with an informal sharing of the results with key stakeholders. Your summary would include the following:An introduction to your survey, reinforcing the message that you care enough about your clients to formalize the client feedback process on a regular basisYour overall satisfaction ratingSatisfaction ratings on specific service dimensions that are relevant (e.g., frequency of contact) to the COIA high-level overview of what your clients consider to be the most important aspects of the relationshipHere is a sample follow-up letter. (Click for a standalone version.)Dear COI:The results are in. Recently we conducted a third-party audit of our client service, and response was overwhelmingly positive. Since you are someone who has supported our business over the years by referring potential clients, I thought you might be interested in the results. We are gratified that our efforts to provide top-notch service to our clients are recognized and appreciated. Here is a summary of our ratings, with all scores based on a scale of 1 to 5:Overall satisfaction with the relationship: 4.7 Client is comfortable with plan to meet retirement goals: 4.9 Calls are returned promptly: 4.8 Advisor is trustworthy: 4.7 Client would refer to friends, family, and colleagues: 4.3 As a service professional, you might be interested to know that our clients say the two things that are most important to them in any relationship with a financial advisor are:Having a clear plan in place to meet retirement goals Having a trustworthy advisor Thanks again for your ongoing support.Sincerely,[Your name] Opportunity 2: Encourage reciprocal referralsYou can use your survey to identify clients who are not fully satisfied with the other professional advisors with whom they work, including CPAs and attorneys. A sample of 16,000 investors surveyed by Advisor Impact and Moss Adams revealed that within the previous two years, about 8% of clients had not been satisfied with their accounting relationship and 15% were not fully satisfied with their legal relationships.Action: Ask clients to rate their satisfaction with other professional advisors. Include a question in your survey that asks clients to rate how happy they are with other professional advisors. Identify clients who are not fully satisfied and pass along the names of your COIs. By providing referrals, you will create the goodwill necessary to see them come back to you. In so doing, you'll be adding value to your existing client relationships.Opportunity 3: Conduct joint surveys to generate needs-based referralsYou can have the biggest impact on referrals by partnering on your client survey with one or two non-competing COIs. Let's look at the opportunity with a CPA. Action: Approach a CPA to conduct a joint—but fully confidential and independent—survey of both client bases. In this scenario, you would conduct an independent survey of your clients, and the CPA would conduct an independent client survey of his or her clients. Each survey would reflect your own needs and objectives, but you would look for cross-selling opportunities for the CPA (e.g., valuation or corporate audit services), and the CPA would look for cross-selling opportunities for you (e.g., wealth management or estate planning). Upon completion, you would both be in a position to make very targeted, needs-based referrals to each other, while maintaining overall confidentiality. And, of course, you would each gather critical information on how to enhance loyalty and increase revenue in your own businesses.Here is a sample letter that introduces the concept to one of your COIs. (Click for a standalone version.)Dear COI,I'm writing to let you know about a client survey program I thought you would find of interest. We are looking at conducting a client audit, which is tool that allows you to gauge client satisfaction and to identify specific cross-selling and referral opportunities.I thought you would be interested to know that in addition to getting feedback on the service we are delivering, we are asking clients to rate their overall satisfaction with their accountants and expect to be in a position to send you several referrals as a result.The firm that conducts the client audit also works with accountants, so I am attaching the brochure. If you are interested, I would be happy to make an introduction and would be very interested in talking about how we can structure both of our surveys to gather feedback that would allow us to provide more focused, needs-based referrals to one another.I'll follow up in the next week to discuss the idea further, but please don't hesitate to call if you have any immediate questions. Sincerely,[Your name]Two words: client profitabilityThese are a few examples of how the results of a client survey can be used to affect real change in your business. The argument for client surveys starts and ends with a focus on client profitability. We find that while most advisors are profitable, they recognize that they are not maximizing profitability. To maximize profitability, advisors must ensure both that clients are loyal and that all potential revenue opportunities have been tapped. A survey supports that objective, providing you with the feedback you'll need to enhance client loyalty and increase client revenue by: Identifying specific clients who are willing to provide referrals Identifying specific cross-selling and marketing opportunities Helping you gauge satisfaction among existing clients and highlighting areas for improvement Demonstrating commitment to your existing clients Providing data to build deeper relationships with centers of influence and prospects As with any research, the way in which you leverage the data in the short term and integrate the data in the long term turns your survey from a good idea into a powerful business management tool. Julie Littlechild is the president of Advisor Impact, which provides client surveys to financial advisors. For more information, e-mail info@advisorimpact.com or visit www.advisorimpact.com. IMPORTANT NOTICEThis material is provided exclusively for use by Horsesmouth members and is subject to Horsesmouth Terms & Conditions and applicable copyright laws. Unauthorized use, reproduction or distribution of this material is a violation of federal law and punishable by civil and criminal penalty. This material is furnished
as is
without warranty of any kind. Its accuracy and completeness is not guaranteed and all warranties express or implied are hereby excluded. Copyright © 2009 Horsesmouth, LLC. All Rights Reserved.For the exclusive use of Horsesmouth Member: Guy GuySEE BELOW FOR IMPORTANT RESTRICTIONS ON USE. Develop Business/MarketingTurn Client Survey Data Into Marketing Gold By Nicole O. CoulterHorsesmouth Senior EditorFeb. 3, 2006 Are you taking advantage of all the ways a client survey can help you attract more ideal clients? More than just a satisfaction score, survey data is rich with marketing opportunities. Most financial advisors have considered conducting a client survey to gauge opinions of their services, but if they feel they're doing a good job, they often hesitate, figuring,
Hey, what's to learn? I already know my clients like me—that's why I have so many of them. Why do I need to spend $2,000 on something I already know?
The surprising news is that the more your clients like you, the more you may have to gain from the objective data gathered by a client survey. Why? Because you can use the survey itself and the information you gather as a powerful marketing engine for your business. A well-crafted survey can tell you:Why your clients like you Which services they value most How price-sensitive they are and how they feel about your fees Which demographic groups like you the best What services clients need that you aren't currently providing to them Whether or not specific clients will give you referrals What share of an individual client's assets you manage Which marketing message is most likely to resonate with prospects who resemble your best clientsUncovering your unique marketing messageKnowing why your clients like you gives you a leg up in your marketing efforts because it helps to shape your message.
The better we know what our clients want and value, the better we can market to people who value the same things,
explains 16-year veteran Taylor Payne, CFP, president of Payne Financial Advisors, which manages $220 million in client assets in Evansville, Ind.For instance, Payne, who surveyed roughly 200 households last fall with assistance from Advisor Impact, a survey design firm, found that his best clients valued the way he helped them identify their financial goals as well as reach toward them.
We heard our clients saying that 'goal identification' is the most important thing to them,
Payne says.
It helped us recognize what is valued in our marketplace, and who we work well with. For marketing purposes, it gives us the message to reach other folks who are goal-oriented investors. We can go out and attract more clients who see things in a similar way, while making sure we continue to have a service offering directed toward their needs.
Supporting productive referral conversationsSurvey data can also be highly profitable (not to mention motivating) when it comes to initiating a referral conversation with a client. First off, a survey can tell you which individual clients have said they would refer (and usually this is a surprisingly high percentage of your book). Secondly, you know what they value in their relationship with you, which gives you a clear focus for the referral discussion.
Our plan is to sit down with each client and review their survey with them,
Payne says.
Referrals become part of that discussion.
Payne firsts let clients know—individually and collectively—that he values their opinions.
I tell them I've filled out a lot of surveys that have gone into a black hole,
he says.
We want them to know that won't happen—that we take their feedback seriously. We then extend the conversation to the value they feel in the relationship and the kind of goal-oriented clients we hope to attract who are just like them. Clients will recognize themselves in that description, and that's who they're likely to send our way. And we know they'll be a fit for our business.
Demographic discoveriesIn addition to shaping your marketing message and referral conversations, surveys can reveal which demographic groups like you the best—and least. This can be important for target marketing purposes. For instance, in a survey conducted last year by QFinance, the Pinnacle Group in Richmond, Va., learned that 95% of its top clients were satisfied (or thrilled) with its services and that clients older than 60 who resided in the local area were the most loyal.
Clients less than 20 miles away were the most loyal,
explains client services director Elizabeth Bezares.
And clients older than 60 were more loyal than clients under 35. The survey allowed us to do a client loyalty analysis and gave us a demographic profile of our ideal client.
Gregory Harris, president of QFinance, the survey design firm that worked with Pinnacle Group, says a survey's ability to create a demographic profile is important because, in some cases, there is a big disconnect.
In one case, an advisor had always prospected young up-and-comer executives,
Harris says.
Because he was young, he felt more comfortable with them. But his survey scores came back, and he was scoring much better with retirees. In another example, it was just the reverse. Someone was scoring much better with business owners than retirees.
In both cases, the survey results came as a surprise to the advisors. And in both instances, they began to reconsider where they were devoting their marketing efforts. From an efficiency standpoint,
it makes sense to devote your time and energy to going after the group that loves you,
Harris concludes.
A loyalty score is the difference between like and love. Someone who loves you is more likely to give you a referral than someone who likes you.
Making surveys payFinally, in addition to what you can learn from the survey data, the survey results themselves can be valuable as a marketing tool. Positive survey results give you objective proof of the quality of your service and the value you provide to your clients. You might think of it as a
quantification of your reputation.
It replaces a list of testimonials, which can suffer from sampling bias,
says Julie Littlechild, president of Advisor Impact, a survey design firm.
A professional survey is much more quantitative and conveys more objectivity in the process.
While you should always defer to your firm's compliance rules, Littlechild recommends these eight simple yet essential ways to market with survey data.Spread the word to your client base. As a first step after completing a survey, send clients a written summary of your key findings. Outline any changes you plan to make to your practice as a result of the feedback. This will reinforce your commitment to earning your client's confidence, and it can lead to more referrals. For a sample of survey results, take a look at this letter reporting results sent out by a veteran investment advisor in the Midwest. Use the results in one-on-one review meetings. Use survey findings from individual clients to prepare for meetings—and consider reviewing the survey with clients.
Every time we have a review with our clients, we first access their answers to our survey so we're prepared for their mindset of us,
says Chris Beard of Raymond James Financial Services, who completed his survey with QFinance last year.
When you see that a client ranks as an advocate, you know you need to be inviting them to dinner or something more social—to take the relationship further.
Leverage cross-selling opportunities. Wallet-share information obtained in a survey can help you with cross-selling conversations and account consolidation. Survey providers may provide a list of the top cross-selling opportunities based on your results. Once you know these, you can pursue structured marketing activities: quarterly seminars on a certain topic that clients are interested in, for instance, or sending specific articles to certain clients, or generating targeted content for your newsletter.
If advisors are doing comprehensive wealth management, they probably already have a picture of their clients' entire situation,
Littlechild observes.
But for most advisors, there are new opportunities with a survey to look at estate and insurance planning, and share of wallet [the percentage of assets you manage].
Adds veteran advisor Deena Katz, who surveyed her clients last year,
The report [prepared by Advisor Impact] is so useful. They gave us consolidation opportunities, advising us that there are good opportunities to get more wallet share of our existing clients.
Seek more referrals. A survey may tell you that 40% of your clients say they're comfortable giving you a qualified referral, but a truly good survey should give you their names. Even clients who mail back an anonymous survey can be tracked by an inconspicuous number located somewhere in the letter. Knowing which clients will refer if asked simply helps you identify where to focus your referral efforts and bolsters your confidence. You don't have to mention that they said they would refer—but you'll know their feelings about referring when you initiate the conversation. Market to strategic allies. Another overlooked area is using survey data to build relationships with centers of influences. For instance, many accountants hesitate to refer, because they aren't confident what service you'll provide. Take the key positive survey results, summarize them, and send them to centers of influence. It will help strengthen their trust in you. Uncover opportunities to refer to allies. In your survey, consider asking clients to rate the performance of their accountant. If clients say they're not happy with their current accountant, it provides an excellent opportunity for the financial advisor to make a referral to strategic partners. And to the degree you're referring to your strategic allies, it makes the relationship that much stronger. Follow up with referral sources. Use informal surveys and results to reassure referral sources that you're taking care of the person they referred. For example, once you get a referral, within the first six months of working with the new person, send him or her a simple five-point letter that asks for feedback. You could write something like this:
We haven't been working together very long, but I want to make sure everything's up to your expectations. How am I doing? [Insert a 1-5 rating scale and five statements you wish to be rated on.] And may I share your satisfaction level with ____________ [person who made the referral]?
Then when the new client returns the survey, you send a letter summarizing the results to your referral source and thank him or her for giving this referral.
It makes the person happy knowing their referral is happy,
Littlechild says.Showcase survey results to prospects. Don't forget to prepare a summary of your survey results for prospects as well—after conferring with your compliance officer. The prospecting summary can be a one-pager with the following introduction:
Every 18 months we survey our clients. Here's a summary of the results.
Seeing your positive results—verified by a third party—can bolster your image as a professional. It can also let prospects know that should they become your client, you'll take their opinions seriously too. For a sample press release announcing client survey results, send me an e-mail: Nicole@horsesmouth.com. Senior Editor Nicole Coulter specializes in helping financial advisors manage their businesses more effectively. She has previously written about practice management issues for publications such as Registered Representative and Bank Investment Representative. She holds an MBA from the University of Nebraska at Omaha. IMPORTANT NOTICEThis material is provided exclusively for use by Horsesmouth members and is subject to Horsesmouth Terms & Conditions and applicable copyright laws. Unauthorized use, reproduction or distribution of this material is a violation of federal law and punishable by civil and criminal penalty. This material is furnished
as is
without warranty of any kind. Its accuracy and completeness is not guaranteed and all warranties express or implied are hereby excluded. Copyright © 2009 Horsesmouth, LLC. All Rights Reserved.For the exclusive use of Horsesmouth Member: Guy GuySEE BELOW FOR IMPORTANT RESTRICTIONS ON USE. Develop Business/Practice Management8+ Reasons to Survey Your Clients By Nicole O. CoulterHorsesmouth Senior EditorJan. 14, 2005 Gathering formal feedback annually reveals information that clients may not tell you face-to-face—and gives you a better shot at earning more of their business.In 2002, John Kurowski wanted to talk to his biggest and best clients about something other than the bear market's woes. So he started taking them to lunch.One by one, he invited each of his top clients to share a bite to eat—and to discuss their responses to a four-page satisfaction survey he had mailed to them.At the end of eight months, Kurowski knew better than ever what his 25 largest clients expected of him. At the same time, he was able to reeducate them about his investment process and service offerings.
Taking clients to lunch, talking about my process, and asking for their opinions impressed them,
Kurowski says.But the business benefits didn't stop there. As a result of the survey luncheons, one couple transferred an additional $5 million into a managed money account. Kurowski also wrote several insurance policies and refinanced a few mortgages. The assets from the couple's new account alone more than paid for the cost of the survey—and the 25 lunches, Kurowski says.Measuring increases satisfactionKurowski's positive experience with client surveys confirms what scientific research has shown: good surveys help your business.A recent study of financial services customers showed surveyed clients are three times more likely to open new accounts and add assets within one year of participation than those who weren't given the opportunity. In fact, surveyed households tend to be more profitable for advisors overall—regardless of their satisfaction scores. And surveyed clients are 50% less likely to defect.
There's something magical about the survey process that engages clients and grows the relationship,
says Greg Harris, managing director of the marketing research firm QFINANCE and host of a recent Horsesmouth forum on client surveys.In addition to letting clients voice their opinions and feel cared for, Harris says, surveys will give you some hard facts about what clients value most. Armed with that information, you're in a better position to give 'em what they want—which ultimately reinforces the idea that you're listening—and reinforces the positive spiral.More benefits of formal surveysIf you're still not convinced surveying is a best practice, consider some of the ways other financial advisors use this kind of regular client feedback to move their practices forward.Identify clients who will refer. Well-designed surveys provide hard data on your best advocates, ranking them according to loyalty and willingness to refer. This analysis becomes even more compelling when you add demographic and revenue data. Imagine being able to analyze whether your most likely
referrers
are also your most profitable clients, and getting a demographic profile about them, including age, occupation, and net worth.Pinpoint cross-selling opportunities. Surveys offer a grand opportunity to test client interest in new products or services. Kurowski found that many of his clients didn't realize he offered mortgage services and insurance planning—but were interested in learning.
I was able to bring up other things that our firm could do besides just buying and selling stocks,
Kurowski notes.
I told them we're also doing financial planning … and other products.
Identify at-risk relationships. Clients often won't reveal dissatisfaction until their account transfer papers hit your desk. An RIA team, for instance, lost its largest client—a $100 million institutional account that had been on the books for three decades—with no warning. The sudden defection prompted the team to survey its remaining clients to identify other at-risk relationships. Surveying can show you which clients are unhappy and what they're unhappy about—while there's still time to do something about it. If you're asking those questions at an exit interview, it's already too late.S Advisor CircleSenior Editor Nicole Coulter polls advisors each week with questions probing the latest news and trends. Want to join Nicole's list and receive her next query? Just send an e-mail to ncoulter@horsesmouth.com.egment your client base. If culling your book is on your agenda for 2005, consider how survey data can help you decide which clients you should keep and which you should send down the hall. At the very least, you can feel confident about giving away those C clients once you've engaged them and tried to uncover more assets. Talk to clients without pitching a product. Asking for client feedback lets you touch base with clients without selling them anything.
Whenever you send something that is not product driven, it generates good feelings for the client,
notes Jonathan Lowe, an advisor with Ryan Beck & Co., in Baltimore. Lowe mails an annual
Financial Physical
to his clients.Get to know client interests. Lowe also asks clients to list their hobbies and interests, and from their responses he generates a focus list in his contact manager.
I'm able to identify groups of people—the 20 people in my book who love bird watching, for instance,
he says.
Then whenever I read something in the paper or see an article they might like, I can quickly shoot them a copy. It creates a more personal relationship.
Know what clients want. Among other things, surveys help you pin down how much contact clients like to have. In most cases, they want more communication—but not always. An advisory team working with QFinance discovered that 62% of their clients didn't value their quarterly meetings. The team was able to reduce the massive number of hours spent with those clients and dedicate more time to prospecting, increasing their revenues to record levels.Recognize the value of your staff. Ever wonder how your clients would respond if your sales assistant quit? Kurowski found that all of his clients were extremely pleased with the service they received from his sales assistant.
They love her,
he said. As a result, he has compensated her accordingly and communicated his appreciation for her efforts.
I wouldn't want her to leave,
he says.Tips on effective surveyingHere are some tips from Harris and others in my Advisor Circle on how to make your surveys the best they can be:Survey all your clients so you can gain insight into how you might deepen your relationship with B and C clients.Avoid yes-or-no questions. Instead of
Are you satisfied with my level of expertise?
, ask clients to indicate how strongly they agree with this statement:
I am very satisfied with my advisors' level of expertise.
Be precise and positive with open-ended questions. Instead of
Tell us what we're doing wrong,
consider
How we can add more value to your life?
or
Tell us a few things we can do to really impress you.
Survey annually so you are always abreast of your clients' most recent attitudes. Use the same assessment each year to benchmark your performance, and identify specific areas where your ratings have improved—or deteriorated.Give clients more than one way to complete the survey. Offer some combination of mail, e-mail, fax, Internet, and phone.Shoot for greater than 50% participation.Don't provide gifts. You want to know if a client won't take 10 or 15 minutes out of his life to respond—without incentive. Ideally, you should give clients several reminders and opportunities to respond over a 30-day period.Keep your survey brief (no more than 17 minutes to complete).Follow up quickly with results. A simple message on your website, an e-mail, or a letter to clients should summarize your findings and reveal an action plan.Avoid direct confrontation about negative feedback. Try diplomatic language such as
Several of our clients told us that _________. How, in your opinion, can we improve in this area?
Use survey data to launch a client advisory board. Such boards can be excellent ways to test new marketing ideas, notes Bob Weigand, a CFP advisor in Fayetteville, Ga.Make annual surveys a cornerstone of your business plan.Consider hiring a third party to assist with your survey so you can focus on core competencies, delegating the survey design and analysis to professionals.Sample survey statementsOne of the most effective survey tools is a Likert Scale, which allows clients to put a number value on how strongly they feel about certain statements. This gives you mathematical results you can benchmark. Consider using one with statements like these, many of which appear on Harris's loyalty surveys.I talk my advisor up to friends and family.I frequently consider shopping for another financial advisor.In the last year, my advisor educated me on at least one important concept or idea.I consider my advisor to be the
quarterback
of all my financial affairs.My advisor has educated me on something in the last year that I didn't know.I wish I spent more time face-to-face with my advisor.It is important for me to brag about my investment performance to my friends.It is important for me to earn 12% annually vs. 10%.I look forward to doing business with my advisor in the foreseeable future.It may be helpful as you plan your own survey to take a look at one FA's actual annual client letter and satisfaction survey. Additional sample surveys can be found in the Horsesmouth article
Let Clients Rate You
or in Deena Katz's book Tools and Templates for Your PracticeThird-party resourcesProfessional-quality surveys and analysis may be less expensive than you think. Depending on how much analysis is involved, the price could range from $500 to $5,000. You can ask your branch manager, wholesaler, business coach, or colleagues for their favorite providers of survey design and/or analysis, or consider these suggestions from members of my Advisors Circle:QFinanceParagon ResourcesSenior Editor Nicole Coulter specializes in helping financial advisors manage their businesses more effectively. She has previously written about practice management issues for publications such as Registered Representative and Bank Investment Representative. Senior Editor Nicole Coulter specializes in helping financial advisors manage their businesses more effectively. She has previously written about practice management issues for publications such as Registered Representative and Bank Investment Representative. She holds an MBA from the University of Nebraska at Omaha. IMPORTANT NOTICEThis material is provided exclusively for use by Horsesmouth members and is subject to Horsesmouth Terms & Conditions and applicable copyright laws. Unauthorized use, reproduction or distribution of this material is a violation of federal law and punishable by civil and criminal penalty. This material is furnished
as is
without warranty of any kind. Its accuracy and completeness is not guaranteed and all warranties express or implied are hereby excluded.