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Why Knowing Your Client Is Key to Success

There’s a hairdresser in Arvada, Colo., who likely knows more about her clients than their doctors. She listens to them and makes them feel valued. She’s honest with them when pixie cuts aren’t right for their face frame and her referral business is booming.

Getting to know your clients and making them feel you are in tune with their needs is key to more referrals and more business growth, according to a 2018 study. Also key is being comfortable with tension.

The “Know Your Client” benchmarking study by FPA, Capital Preferences, and T. Rowe Price found that clients might respect and like you more when you are a “behavioralist”—someone who tells them in a diplomatic way when they say one thing yet do another.

A behavioralist, the study noted, is a planner who has “will, skill and means” and can handle tension productively. This leads their clients to appreciating their honesty, referring them to more people and it results in more business growth, the study found.

But planners have to know their clients well in order to pull this off.

“The better we know and understand our clients, the better we are at providing financial planning services,” Frank Paré, CFP®, chair of the FPA board of directors, told InvestmentNews. “Having a deeper understanding of our clients helps us to point out where there might be some inconsistencies in terms of what they do versus what they say. I’ve seen that where clients are looking to the future but still going to Vegas on a regular basis.”

He added that clients want to be called out when they are not acting in alignment with their goals. And although that might be tense, if a planner is a behavioralist with will, skill and means, they thrive in that situation.

“In identifying behavioralists, we’re looking, for example, at how planners deal with the tension that creeps into a client relationship. Behavioralists are comfortable with that tension,” said Pat Spenner, chief marketing officer at Capital Preferences, in an InvestmentNews article.

The takeaway is to put in the time to get to know your client, their partner and their families—including pets (ever talk to a 30-something millennial with only fur kids? Hello, unsolicited dog pictures.)

A Financial Planning article reporting on the survey noted that the sweet spot is to spend around six extra hours working to know your client and their loved ones in the first year of the relationship. That six-hour commitment led to a referral rate of 27 per 100 clients and a net growth rate of 24 percent.

Editor’s note: This article originally appeared in the August issue of the Journal of Financial Planning in the Observer section. The Journal of Financial Planning is a member benefit for Financial Planning Association members. Not a member yet? Become one today.

Ana TL Headshot_Cropped

Ana Trujillo Limón is senior editor of the Journal of Financial Planningand the editor of the FPA Practice Management Blog. Email her at alimon@onefpa.org, or connect with her on LinkedIn


Is Your Firm in Growth Mode?

Over the years, I’ve worked with advisers at all levels of production and from all types of firms. Most tell me they are very busy—and they truly are. But as I often mention in our consultations, you don’t ever want to be too busy to grow.

Of course, most advisers have active day-to-day schedules. But at the end of the year, many haven’t added any new clients. They usually come to that realization when something goes wrong: several large clients pass away or assets are transferred away unexpectedly. Suddenly, they are interested in prospecting and gaining referrals, but those skill sets may have withered away from lack of use.

Having a firm culture that promotes growth is also tremendously important in attracting great staff and retaining them. Have you ever heard of someone eager to work in a place where everything stays the same, where there are no plans to expand, and where it’s basically as good as it’s ever going to get? Me neither. Growth in a firm benefits everyone—from advisers, to service folks, to support staff and operations. Practices in growth mode present opportunities for personal and professional development. Clients also benefit, as firms add resources and skills to their offerings.

Which brings me to your plans for growth in the years ahead. It’s okay to be particular when accepting new clients and to tailor your business to segments where you add the most value. But if you’re not growing, you’re dying (as the saying goes).

Since so many advisers are skilled planners, I’m taking it as a given that many of you have business plans that are thoughtful, strategic and in writing. (Let’s also assume that your entire team was engaged in the process of developing these plans.) To help determine if your firm is truly in growth mode, think about the past three to five years and ask yourself the following questions:

Did You Meet Your Growth Rate Goals?

If yes, why? Take a look at where you set realistic and stretch goals, and then spend some time thinking about where you succeeded. Did you undertake a marketing initiative that brought in prospects? Did you host an event where clients brought guests? It’s important to analyze where you’ve had favorable outcomes so you can build repeatable processes. It will also help you figure out what exactly in your team’s skill sets led to those positive results. For example, if your staff excels at putting on events and you meet great prospects that way, build more workshops and events into your calendar.

If you didn’t meet your goals, why not? Were you overly optimistic on a few RFPs you sent out, or did the pace of referrals slow down? Were prospects looking for expertise or services you don’t offer? Did you lose more clients than expected? The knowledge you gain here will be enormously helpful moving forward. The idea isn’t to blame anyone (either yourself or a team member). Rather, it is to learn from your experiences so you can plan ahead strategically.

One adviser I work with had three great prospects who came in to see him. Each had been very positive about working with him. But after the meetings, they all decided to go elsewhere. The adviser and his team spent some time assessing why and how they lost the prospects. They came to the realization that they needed to redo their office space. High-net-worth prospects didn’t appreciate the copier’s prominent position in their reception area, and the dingy carpet didn’t communicate the exclusivity they wanted to convey. A year after upgrading their space, they are again turning those prospects into ideal clients.

How Many New Clients Did You Add Each Year?

This is a pretty simple question, but I’m surprised how frequently advisers can’t answer it. Can you? You get bonus points if you track this information and can answer quickly and easily. Tracking new clients (e.g., who referred them, how you met them, how they progressed through your pipeline) allows you to understand where your new clients are coming from, so you can duplicate the process that attracted them.

Adding new clients to your practice is one of the surest signs of growth I know. It’s nice to say that you have 10 percent or 15 percent growth year over year. All too often, however, that’s due to market appreciation of assets. What happens when the markets work against you? You want to continually add clients to your practice, both for the new assets they bring in today and for the pool of prospects they might introduce to you in the future.

If you can, try to involve your staff. One adviser I spoke with gives his staff colored sticky notes to keep near their phones. If they hear a client say something that could lead to a referral (e.g., “My brother is moving to town”), they jot it down. The notes are then discussed at staff meetings and follow-up opportunities identified. Even if your practice is at the point where you don’t need many new clients (lucky you!), you should still be looking to add a few large, ideal clients every year.

How Many Introductions Did Clients or COIs Give You?

This is another metric that is worth tracking carefully. You should have a good handle on how many introductions you receive. A steady stream of referrals is a vote of confidence and worth noting, while a dwindling referral supply can indicate potential problems. Tracking helps ensure that you thank all the referees and helps you understand how many prospects you need to meet in order to gain a new client. Do you have a 4:1 closing ratio, or is it closer to 2:1? Understanding your key metrics helps you keep your pipeline full and manage client onboarding.

So, Are You in Growth Mode?

In evaluating your answers, does it seem like you are in growth mode? If you couldn’t quickly and easily respond to these questions, you may have your answer. But if you’re looking to create a culture of growth at your firm, there’s no time like the present to begin.


Kristine McManus is chief business development officer, practice management, at Commonwealth Financial Network®, member FINRA/SIPC, the nation’s largest privately held Registered Investment Adviser—independent broker/dealer. Since joining the firm in April 2014, she has been working with affiliated advisers to grow their top line through the introduction of various programs, tools and coaching. Kristine holds the Chartered Retirement Planning CounselorSM designation, a master’s degree from Pennsylvania State University, and a BFA from Adelphi University.

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Differentiating Your Value: People Make the Difference

Foundational to attracting and retaining new clients is the need to consistently articulate, demonstrate and validate your value. In a commoditized industry, there are fewer ways to differentiate your value, yet nearly all financial practitioners are seeking business growth. So how do you stand out in a crowded marketplace?

Financial professionals often seem to get lost in a sea of sameness with all marketing mediums, such as websites or brochures, looking and sounding alike. Think for a moment on just how commoditized the industry has become—almost any financial professional can replicate your what and your how, but it’s much harder to steal your why, your who or the experience that you deliver.

Let’s begin with what’s easy to replicate or steal:

Your WHAT—Solutions

Clients can buy similar products and solutions from almost any company on the street or, indeed, online (a financial plan, funds, stocks, bonds, insurance, annuities, etc.) The type and the size of firm are no longer nearly as relevant as they were two decades ago where you had to go to certain institutions to purchase particular products. Today, those solutions and products can be “purchased” anywhere regardless of whether you are a planning-centric firm, a brokerage-centric firm, an insurance-centric firm or a bank.

Your HOW—Process

Almost all financial professionals have a process that begins with discovery and includes recommendations, implementation, monitoring and ongoing communication. Many will use a visual of some sort in their marketing materials but generally, the process itself is very similar regardless of where a client goes to seek financial advice.

Reality reflects that what you provide and how you work with clients can be replicated almost anywhere.

So now, let’s look at today’s opportunities to create the real differential in this industry:

Your WHY

Your personal why, your team why and the signature story that you all articulate is much harder to steal—it is unique. Financial professionals enter the industry and stay in the industry for differing reasons. Drivers and motivators vary for each human; purpose and beliefs are personal and distinct. Simon Sinek is a fantastic resource on the subject of why; watching his TED Talk or reading his book may be instrumental for you and your team in creating this distinction for your practice. And, if you need to work on your story and positioning, we recommend contacting Susan and Adam Kornegay, fellow consultants in the FPA Coaches Corner.

Your WHO—the Client

The type of clientele that you serve can also be a differentiator. Those who have become specialists in niche marketing have created a distinction from those who serve anyone or, those who qualify prospects purely through a financial-minimum! Perhaps you serve “cardiologists in the U.S.” or, “female small business owners” or “C-suite executives in the Southeast.” The more specific your tribe or your niche, the more likely you are to become known for what you do and subsequently differentiate yourself from others in financial services.

Your WHO—the Team

Building a team of professionals can also be differentiating. The industry has been revolutionized from the sole practitioner model to teams. Teams can be small or large each with varying specialists, knowledge, experience, credentials, backgrounds, passions and interests. Your associates and what they bring to the table can play a remarkable role in differentiating your practice.

There are vertical teams, horizontal teams and hybrid teams all offering something a little different. As you talk with clients, prospects and centers of influence within the communities that you serve, ask yourself if you are maximizing your team members. Are you appropriately positioning all the expertise you offer to your clients? Are clients building a trusted relationship with all members of your team? Do you have any gaps of coverage that you need to address? Should you consider expanding your team? Your team can create a tremendous differential for your practice!


The experience that you deliver to clients, prospects and centers of influence can create a unique differential that no one can replicate. Your experience should take into consideration every emotion a client can FEEL when interacting with your team—whether in-person, on the phone or online. Remember Maya Angelou’s famous quote, “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.”

Consider your environment; step into the shoes of a client or prospect. What feelings do you and your team evoke throughout each encounter of your client experience? We recommend that you have a service menu of deliverables for each segment of clientele and that you systematize all repeated activities on the back end of your practice so that you have time and capacity to deliver a customized experience on the front end.

Ensuring your client experience is memorable is critical to differentiating your value. Your standards of care will have a tremendous impact on client retention and on the pace at which you grow. In part, we speak so often on the team experience because without an impactful internal experience, your associates will unlikely deliver a differentiating external experience to your clients.

As you read through this article, you will quickly notice that it is the people who really create the distinction in your business—it is rarely the products, solutions, the process or the numbers. We encourage you to meet with your team and further explore the question, “Why should I do business with you/your practice?” Do you have a compelling answer that differentiates you from the competition? Are you focusing on the right elements? Does your client base understand the totality of your value? Do your centers of influence know what makes you different and why they should send you referrals?

Knowing your value and distinction is just the beginning. You will then need to make sure you position your practice correctly in a way that stands out, and, most importantly, the team needs to consistently live your value. In this increasingly complex yet commoditized world, it is more important than ever to articulate, demonstrate and validate your value. When clients and prospects understand what makes you unique and then personally and consistently experience those elements, retention increases and growth enters a new trajectory through an increase in both the quality and quantity of introductions.


Sarah E. Dale and Krista S. Sheets are partners at Performance Insights (performanceinsights.com), where they focus on helping financial professionals increase results through wiser practice management and people decisions. They are FPA Coaches Corner coaches for team development. See other resources from them in the FPA Coaches Corner.