5 Financial Advisor Prospecting NO-NOs


Prospecting is tough, for anyone in the any industry. It relies on strength and capacity to start, to keep going and to pick yourself up when you fall. It's understandable that advisors struggle, but some insight as to why might help to push through. For more information, read our blog, Top 3 Reasons Why Financial Advisors Struggle with Prospecting.

In 2003 I started with an insurance company. I had no client base, no leads, no financial security, no mentorship and loose management. I did, however, have a bond and an affinity for travel, healthy food and a good life. I needed clients.

I spread my prospecting net wide and tried many avenues with which to pursue and attract potential new prospects. Some worked, many didn’t, and it is a selection of these that I’m going to share with you today. Call it a head start (or a heads-up) as to what not to do when building your financial advice business.

Buying Leads

I used at least three ‘lead provider’ businesses and all 3 were a failure. Over the years I have met more than 100 financial advisors that have, at one time or another, contracted similar businesses, and very few renewed even once.

The promise is sound: “We’ll provide you with 10 qualified leads for R3,000”. These businesses work off lists that they acquire, often illegally. They are owner-run or they employ outbound call centre agents and they all use a similar generic, product-driven script. Your value proposition and your target market are largely immaterial. Their approach is unsolicited, impersonal and unprofessional, yet when they receive a hit, the advisor is grateful to have an appointment, which is too often substandard.

Not all of these lead provider businesses are terrible, but it’s a gamble and the time required to find a good one is best used elsewhere.

Using Call Centres

Like many of my advisor colleagues, I made friends with individuals at inbound call centres. Whether or not there is a formal process, being top of mind with someone on the front line is advantageous. The risk, however, is that you have little control over the quality of the referral.

Call centre agents have an obligation to refer enquiries to such a person and in such a manner that the enquiry is dealt with and satisfactorily concluded. There are two objectives in this regard: (1) business retention and, (2) new business. But consider who is making contact with a call centre: If it’s a high value client, they normally have an advisor attached to their name. If it is a new business enquiry, you have to wonder why they are using a call centre and not asking friends, family and colleagues to refer them to an advisor. If it’s an orphan client, their value is most likely low. Every now and then one may stumble upon a gem, but you have to go through a lot of dirt to get there.

Ten years ago I would have told you to establish your contacts in call centres as a secondary strategy, but today’s processes make it difficult, and most leads are admin enquiries.

Relying on Any One

“Centres of Influence” is a very popular and overused phrase. Most advisors are keen to partner with lawyers and accountants that can refer leads to them. But why would they?

In most cases these said professionals are not clients of the advisors and have not experienced their service. Unless the centre of influence can absolutely vouch for your service, they are unlikely to refer.

The same can be said for any would-be referral source, but that does not mean you have to only rely on your clients for referrals (your best advocates) – my advice is that you simply should not rely on any ONE referral source. Connect with influential people everywhere, impress them and make sure they know what you do. They could refer you because you impress them more than their own advisor!

Operating Outside Your Ideal Market

If you have a clear idea of who you want to work with, pursue that person. Any time and energy spent elsewhere is in construction of the business you do not want.

There are many ways to consider your avatar of a client, including demographics and psychographics, but you don’t have to get it perfect. Just create a filter for the type of person you want to work with. Prospects you either meet or are introduced to will either pass through the filter or not.

If you are new in the industry and building a client base from scratch, you may have to have a 2-tiered approach, the first being your ideal client, and the second being low-hanging fruit. This also depends on the type of business you are as well as your remuneration structure.

Focusing on Product

The history of the industry is one of selling insurance. Brokers sell products for commission but we’re moving into a world where planners and advisors sell advice for a fee.

The change is slow, but regulators are making progress and companies are re-looking at the way in which they do business. The Financial Services Conduct Authority (FSCA) and the Financial Planning Institute (FPI) are pushing hard to have qualified advisors that are fit and proper provide financial planning advice, and the media is on board.

If you lead with the product, you may be playing an oversubscribed game. Lead with curiosity around your clients’ financial needs and provide them with a plan that will help them realise their dreams.

So what’s the next step then? You’ve heard all the NO-NOs and know what not to do; but where to from here? If you’re a Financial Advisor (or perhaps working to become one) then I have the solution for you:

Register for the 1-day INSANE! Prospecting Bootcamp for Financial Advisors and learn the skills and acquire the tools to grow your business through client acquisition!

#financialplanner #prospecting

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