Step 4: Add value. Once you’ve identified the clients you can help, you will find certain legal strategies and financial products helpful. For example, you might have business owners who are doing well and want to decrease their income taxes. You can show them sophisticated defined benefit plans that may be able to lower their income taxes by many hundreds of thousands of dollars. And if they choose to implement, you benefit as well.
Other professionals, meanwhile, are often looking for ways to generate more revenue, and there are a number of ways you can help them, not only by finding new strategies but also explaining them.
Consider trust and estates lawyers who want to grow their practices. One easy way for them to get new business is to look at the files of clients who have previously worked with them on wills. Very few trust and estates lawyers are doing anything with these previous clients, and don’t entertain the idea of looking to them for marketing opportunities. But there are some highly effective approaches you can share with these lawyers to garner new business from dormant law firm files.
Comparing The Two Tracks
You’ll usually need the help of both clients and other professionals to grow 21% or more in a year, especially if your practice concentrates on high-net-worth clients.
Exhibit 2 highlights some of the key differences between these two sources.
If you’re working with existing clients you have easy access to, you can quickly move the process forward—you’re familiar with them, so it can be easy to discern the gaps in their planning and ways you can add value. That means you’ll be able to do more for them sooner and generate revenues fairly quickly.
It takes much more time to develop the necessary insights into other professionals and find out how you can help them. You have to commit at least a year to the approach before you end up with a steady flow of new, wealthy clients from the accountants and attorneys you know.
If you already have a large percentage of your current clients’ investable assets, you’re unlikely to pick up much more. But you’ll likely be able to incrementally increase the assets you’re managing for your wealthier clients, who tend to diversify among money managers. When you’re introduced by other professionals to new, wealthier clients, you’re in a good position to be entrusted with substantial assets to manage.
Many of your current clients might benefit from non-investment financial products. Depending on what you’ve been focusing on, there can be many such opportunities for you to add value. On the other hand, when other professionals bring you in—especially to their wealthy clients—there are likely to be major opportunities for various types of financial solutions.
Generally speaking, your current clients are more likely to refer you to clients of equal or possibly less wealth. They’re also likely to have only a relative handful of good prospects. Other professionals, on the other hand, because you have assessed their needs and judged your ability to help them, will likely be able to refer you to much wealthier clients for a range of financial products.
When it comes to getting more help to clients, most financial advisors can fairly quickly refine their approach to get results. It’s somewhat harder to get more value to other professionals.
The bottom line: This is not about selling. You’re helping people pursue their own interests. And yet in many ways, you’ll be the one to benefit.
Russ Alan Prince is president of R.A. Prince & Associates. Brett Van Bortel is director of consulting services for Invesco Consulting.