Effectively cultivating centers of influence is the most profitable way to build a significant book of new clients—especially affluent new clients. For example, the revenue differential between a referral from a center of influence and a client is about 20 to 1 or better over the financial advisor’s relationship with the client.

Although there’s little doubt about the business-building power of cultivating centers of influence, most financial advisors have had limited success doing so. The following are three interrelated major missteps:
• Not acting as if the center of influence is the client.
• Failing to develop formal action plans for each center of influence relationship.
• Not delivering meaningful value-added to each center of influence.

Let’s take a closer look at each of these missteps.

Not Acting As If The Center Of Influence Is The Client
When we ask financial advisors working to cultivate centers of influence, “Who is the client?” aside from identifying the referral made by the center of influence, nine out of 10 of them also cite the center of influence as being the client (Figure 1). This commonly held perspective is right on target. The center of influence needs to be treated and worked with as a client in the sense you need to understand them, be responsive and add value.

Figure 1: The Center Of Influence Is The Client
Yes    91.4%
No    3.3%
Unsure    5.3%
N = 549 financial advisors


The complication is that while financial advisors recognize and talk about the center of influence being the client, in many ways they don’t act that way. For example, while all the financial advisors reported having files on each of their affluent clients, only about a sixth of the financial advisors said they had files on their centers of influence (Figure 2).

Figure 2: Have Files
• On their affluent clients    100.0%
• On their identified centers of influence    12.9%
N = 549 financial advisors


More telling is that we asked the financial advisors a series of questions about their top affluent clients and their top centers of influence. All we wanted to know is if they believed they knew the answer to the questions, not what the answers were. We then converted their responses into a summary score where TEN is extremely knowledgeable and ONE is not knowledgeable at all. While the financial advisors tended to be very familiar with their affluent clients, they strongly tended to not be very familiar with the centers of influence they were focused on (Figure 3).

Figure 3: Detailed Knowledge
On their affluent clients    7.9
On their identified centers of influence    1.8
N = 549 financial advisors


While it’s easy and correct to say that the center of influence is the client, a large majority of financial advisors are clearly not taking the actions to deal with them as clients. Failing to do so is a misstep that will quickly derail any effort to cultivate them.

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