The Perfect Client Service Meeting Steve Moeller A financial advisor recently had just sold his practice and was explaining his philosophy on fee-based asset management, saying it's far too expensive. He couldn't see why clients would pay one percent for managing their mutual funds and delivering reports on their portfolios. So he had been charging only 25 basis points. I knew it was nearly impossible to offer these services for such low prices and still stay in business. His business model was based on three or four public seminars every month. Then he followed up aggressively with every attendee, trying to sell something. His business was doing well. In fact, he had more business than he could possibly handle. He was working 60- to 70-hour weeks and was completely burned out. He needed a change. His service work had become overwhelming. He was locked into a cycle of long hours and constant pressure. And because he was charging only 25 basis points, he didn't have enough money to create an infrastructure of competent coworkers. Instead he focused on creating new transactions and a greater backlog of service work. So he finally sold his company and left the industry, convinced that 25 basis points was the most he could charge. CLIENTS ARE HAPPY TO PAY FOR SERVICES THEY VALUE Why would clients pay more? They would pay more if they perceived they were getting something of significant value. In a fee-based financial services relationship this means service, advice, estate planning, coaching, simplification, control, and offering a total solution to their financial problems. This process is becoming known as Comprehensive Wealth Management. If you provide value that your clients want, they will gladly pay more for your services. The foundation of a fee-based money management service is the quarterly meeting. Meet quarterly with every one of your key clients during the first two years at least, then you can cut back to two or three times a year. You need to work hard to maintain contact by creating other value-added services. The result: You can charge more for your services, attract better quality clients and build strong, life-long relationships. THE IDEAL SERVICE MEETING You must have an agenda. The agenda allows you to establish a structured process for your clients and helps you eventually transfer this function to another staff member. You should organize the agenda in three parts: The Opening: Strengthen the personal relationship and inquire about new developments in your clientsí financial situation. The Presentation: Exchange high-value information, including a performance review and a wealth management discussion. The Closing: Organize the next meeting. START THE MEETING Figure on an hour to 90 minutes for these meetings plus half an hour of follow-up as you jot down notes and delegate tasks to staff after each meeting. Open the meeting by building your personal relationship for about 10 minutes ask about your client's personal lives. These types of questions address the types of things friends normally talk about. The discussion will give you insights about who they are and what they're thinking about currently. It's important for you to know if they're going through any changesñsuch as receiving an inheritance. In each meeting, ask this important question. Ask your clients if they have any questions about their personal finances or investments. List the questions so you can answer them during the presentation. Next, review investment performance versus your clientsí goals. Notice I said their goals, not the indices. A good investment proposal is effective for retaining clients during tough markets if you have established performance goals based on reasonable expectations. Then if you compare actual performance to your clientsí personal goals, you'll generally add more perceived value. Personalizing their information is a value added process. The great thing about this system is after a few years you're normally ahead of your client's goals. ADD VALUE BEYOND THE CORE PRODUCTS AND SERVICES If you think like my friend, John Bowen, you'll present yourself as a ìPersonal CFOî( for each of your clients. Some call this, ìcomprehensive wealth management.î It means you take the burden off your clientsí shoulders, help them feel in control of their finances and put their financial house in order. If you don't have an organized process for delivering this service, the greater level of interaction with your clients will drive you nuts. If, on the other hand, you have it down to a science and have trained your clients to provide you with the correct information at the right times, these meetings should run smoothly and with little effort. Develop a process for creating and printing reports on schedule. A breakdown with this key step will stir feelings of uneasiness. Consider outsourcing this to vendors that specialize in this service or if you do it in-house have a flawless system. You need to develop a list of key services that you can focus on each quarter for the first two or three years with each client. Start by taking all of your clientsí personal financial information, organize them in a binder, and help them go through their papers. One area most of your clients are going to need help with is estate planning. Once again, gather all of the documentation and organize it in a binder. Help them find the right attorneys, accountants, and insurance specialists. These discussions are good for three to four meetings, or the first year, as you walk them through different issues. Once you've accomplished this initial organizing over a two to three year period for your clients you'll have their trust, you and they will know exactly what the game plan is and you'll have an intimate knowledge of all of their personal finances. Why would they ever what to change advisors, particularly if you manage their expectations and deliver market returns? MANAGE YOUR CLIENT'S EXPECTATIONS The last phase of your quarterly meeting is keeping your clients happy for the long run, helping them become successful investors and keeping them from bailing out when the markets get rocky. You must educate them to become successful investors. In a typical year the stock market has one up quarter and three down quarters. It's important for your clients to realize that markets are volatile. So, tell your clients when they've had an especially good quarter in the market. This educational process is part of your value-added service. CLOSE THE MEETING This brings us to the Part 3 of the meeting: closing, asking for referrals and setting up the next meeting. Just like at a dental appointment, you should close your meeting by scheduling your next meeting. Tell your clients your agenda for next time and what you'll be focusing on. Tell them what information to bring. Explain that your office will send a letter and make a follow-up call to confirm the meeting. These types of client service meetings will have tremendous value for your clients who have accumulated personal financial mess over many decades. Once you spend two to three years helping them organize their personal finances and educating them about how the market works, they'll typically see a substantial improvement in their personal financial well-being and in their feelings about their finances. This feeling of being in control will create a strong bond between you and the client. Instead of focusing on cutting costs, focus on adding value. All you need is a systematic and organized way to deliver value to your clients. Package your meetings in a way that are easy for you to deliver and demonstrate high-value to your clients. By focusing on providing value that your clients appreciate, they will be happy to pay you well for your services and will send their friends to you. With the additional revenue, you can hire a competent staff to help you service your clients. This will keep you in the game and prevent burn out. Copyright © 2000 by Steve Moeller, Tustin, CA. All rights reserved. Steve Moeller is one of North America's foremost experts on marketing financial services to the wealthy. Over the last decade, Steve has studied and researched the best strategies for building a super profitable financial services business. He is a highly sought-after financial services industry speaker and management consultant. He is the author of "Effort-Less Marketing"and other learning tools and coaching programs. To find out more about his coaching programs, learning tools or to find out how to hire Steve to speak at your meetings, call 800-678-1701 or e-mail bizviz@businessvisions.com. For a free subscription to Steve Moeller's Client-Centered Advisor e-mail editor@businessvisions.com.