Advisors who take into account these differences by industry will be able to tailor their value propositions to better match the firm they are prospecting. For legal service firms, making certain to talk about review timing is important. For health services firms, highlighting educational materials related to regulatory compliance may be beneficial.  

Not accounting for these differences may hinder an advisor's ability to grow their business in the long run.

Firm Size Matters
In small businesses (fewer than 50 employees), key decision makers are likely to be emotionally invested in the business. Relationships matter and decision makers at small businesses prefer an advisor who develops a personal relationship with them and their employees. They favor face-to-face contact with employees over other types of communications. For example, when ranking what was important in participant education, small professional service firms were twice as likely to choose in-person meetings as they were webinars.

In contrast, decision makers in midsize and large firms (with between 50 and 500 employees) are often formal boards. Many times, they are composed of senior executives who may be somewhat disconnected from the day-to-day activities and thoughts of employees. Large firms are more likely than small firms to turn to conferences (37 percent versus 20 percent) or to webinars (28 percent versus 14 percent) for participant education. Large firms are also more concerned with full fee disclosure and help with legal and regulatory compliance of their plans, while smaller firms list help with a plan design that takes care of them and their key employees as a top value they seek in a relationship with an advisor.

What does this mean for advisors? Advisors who take into account the differences between large and small firms will be able to build meaningful relationships with their clients and modify their offerings to fit the specific needs of each firm.

Newer Vs. Older Values
The study identified pronounced differences as well between newer and older firms.  Companies less than 10 years old are mostly concerned with building a consistent profitable business. They value the talent they have, and are focused on keeping it. They understand that retention and engagement are key to a stable business. That's why they place more emphasis on a retirement plan as a way to retain and engage current employees, instead of as a tool to recruit new talent.

Companies that have been in business longer are more concerned about plan features than their less-tenured counterparts. They're also more likely to review their benefits packages to ensure the plan's features are up-to-date. Firms over 50 years old are twice as likely to review benefits packages to make sure up-to-date features have been adopted.

We discovered another interesting difference when we asked firms about their top factors for selecting a provider. Newer firms selected "provider service and support for employer" as their most important.  For long-tenured firms, support from the provider was listed as fourth behind "full disclosure of fees," "variety of investment options," and "provider service/support to participating employees".

Advisors who understand these nuances have an opportunity to focus on taking what makes them unique and tailoring it to what a prospective client wants most.  For long-tenured firms, highlighting plan features will be beneficial, while for new firms, the focus should be on the support provided.

The Trusted Advisor
Keeping and retaining business also presents a set of challenges for advisors.  Understanding the top business issues and needs of your client and how the expectations of decision makers may differ depending on the size, tenure and type of firm can help advisors maintain deep relationships with their clients.