I will share with you things that you presently think are impossible, because when I started them, I thought that they were impossible, and everyone told me that I was mad. But as I tell you my experience, and you see what we are doing and how we do it, I know that you will want to make massive changes to your practices because these changes will do the following:
- Reduce the time that you spend on work
- Improve the average sale size to each client
- Increase client loyalty
- Increase the profitability to your practice
- Make you unique to the competition
It all started with a problem in the practice back in 1999.
In those days, I was working, as most of us do, from referrals, and I had a simple referral system that worked well enough and got me to Top of the Table each year. The problem was that my growth was limited. No matter how much I tried, I could not increase my case size or my numbers because the people I was seeing referred me to people like them, and while they were lovely people and I liked helping them, I needed bigger clients with bigger issues and bigger problems so that I could provide bigger solutions.
But I also had another problem, one that many of us are experiencing, and that was review overload.
Over my first eight years in practice, I had amassed a significant number of clients. At that stage, I didn't understand the difference between a client and a customer, and while I had a client segregation structure so that I wasn't spending time with people who, frankly, didn't need my help any more, I had too many existing clients to see.
Now, seeing existing clients is important, and we need to service them and love them and care for them. But as our businesses grow, there can simply be too many of them, and often too many where there is little future business.
So here I was. I wanted to see bigger clients to grow my business, but I didn't know how to find them. On top of that, I was using most of my time servicing existing clients who needed me but in an activity that generated little new business.
I am sure that many of you are in the same positon. Look at this calculation, and run it for yourself. [visual]
If you work 40 weeks a year and work five days per week that gives you 200 working days. Of these days, I spend only 150 days in the business as I spend around 50 days in my other business.
I don't know how many of those days for you are client facing, but in my case three-fourths are client facing. This gives me 112 client-facing days, with the rest set aside for administration, MDRT attendance, continuing professional development, and so on.
Now, I see all my clients in my office, which means that on a good day I can see four clients, but usually it's more like three clients. This gives me 336 appointment slots for clients.
I have 243 clients. These are people who are paying me a retainer to be a client. If they each take one slot a year (assuming I see them only once a year), this leaves 93 free appointment slots.
For most new client sales, I take two appointments, usually a first meeting to establish the need and build the relationship and the second to present the solution and agree the sale. I don't do any paperwork or administration with the client; this is completed by one of my paraplanners. But while I'm good, I don't have a 100 percent closing rate; in fact, it's 84 percent. This then gives me 78 client appointments that will lead to sales and a maximum of 39 new people to see each year.
As you look at this calculation, you can work out your numbers to give you an idea of the time that you have to do business. [visual]
This assumes everything goes to plan. And I don't know what your life is like, but stuff usually happens to me. Stuff also happens to clients, so appointments get canceled and it's too late to replace them, or clients get ill, or clients need three appointments to close. All manner of things happens, which means it's tough to hit the 39 new sales a year mark.
So this is the problem. I was stuck in a 365-day year with only 24 hours available per day. There is only so much I can do. I wasn't interested in getting significantly bigger clients because I liked working with the type of client I had. I just wanted them to be a little bigger and to have more of them.
So what to do about it?
Well, I was lucky enough to be attending a coaching session where I had an epiphany. The epiphany was this: "If you see people one at a time, you will sell people one at a time."
Also, this: "If you complete reviews one at a time, you will only do one at a time."
It's obvious, I know, but it is something that we have all been trained to do because this is the way it's always been done. And then I heard another statement that made a change in the way I think, and it's this: "What got me to here won't get me to there!"
Again, simply, if I keep doing the same things, I will keep getting the same results. What I needed to do was something different. Something original. Something that led to better results.
The answer was to use group events to find and sell new clients as well as to service existing clients.
Think of it: Instead of selling one-to-one, sell one-to-four or one-to-ten. Instead of doing client reviews one-to-one, do them in groups of a dozen or so.
I know this is a stretch because it seems to go against everything we've been taught year after year. But if you can imagine it, imagine increasing your productivity 10 times but without working any harder or longer.
Take a moment and ask yourself, How much business can I do if I could close five clients at once? How much extra business would that generate?
Then ask yourself, What if I could complete a client review in one-tenth of the time it takes now? How much time would I save?
Here is the best bit, and you'll need to trust me on this. The clients will love you for it! They love doing things in groups rather than one-to-one. I know it seems wrong, but they attach more value to it. And remember that value is in the clients' eyes.
So what did my team and I do? How did we move from 121 sales and reviews to group sales and group reviews?
Well, let's look at two different areas: first, the sale and, second, the servicing. As I explain this to you, don't necessarily think about doing everything, but think about what you could take and implement quickly and easily to make a real difference in your practice.
I don't have time to go into a great deal of detail here because we have developed this technique over the last few years, so I just want to jump to the parts that make all the difference and give you real figures so that you can see how this might help you and your clients.
Let's start with cold prospects.
Each year, we send cold direct mail to close to 250,000 people and in some years up to 1 million people.
The objective of the direct mail is to get the cold prospects, whose names come from a purchased database, to attend an education event where we are selling a paid-for first meeting. I know this is how many of you do business, so there is not a great deal new here.
This is how we have worked for 10 years or so. [visual] We get cold prospects to come to an event, where we sell them a first meeting. The first meeting is a one-to-one meeting, which leads to a wealth management plan being issued to the client. At the second meeting, we discuss the plan and agree the business, and then the prospect, who will now become a client or customer, meets with a paraplanner to complete the paperwork.
Seminar selling is great, and we do a great deal of it. In fact, we did 36 prospect seminars last year. But with this technique, the numbers are always capped. Here are ours. [visual]
As you can see, we will mail 10,000 prospects and will get between 15 and 80 people in a room.
From this, our closing rate, or the number of yeses—where the client agrees to make a payment for a first meeting (remember, in the UK there are no commissions, only fees)—is 43 percent. On average, this gives us 15 new meetings.
Our closing rate on these, where we sell more than just at the meeting, is 70 percent, giving us 10 sales.
Of these sales, two become long-term clients rather than just short-term sales.
These figures have been reasonably stable for the last 15 years, and so what I wanted to do was to find a way to improve the figures. And this meant doing something different.
This is a great way to group events, but it has the same problem in that it leads to a one-to-one sale, which means that we are back to the same problem of having only 365 days in a year, each day with 24 hours. [visual] The jump that we then made was to take the prospects from a seminar event into a group workshop, where we could make multiple sales rather than 121 sales.
You can see from the diagram that we will send, for example, 6,000 cold mailers. [visual] From this, somewhere between 50 and100 people will book the educational event. The event is always something specific that they may be aware of, for example, a change in tax, a change in legislation, the investment markets suddenly falling, interest rates going up—that kind of thing.
At the event, it's all educational. There is no selling. What we are doing is throwing value at them to build up the reciprocity. At this point, we are not trying to sell them anything. It's purely about value in their eyes. If you remember from Robert Cialdini's 2005 Main Platform presentation, reciprocity is one of the six motivators that we can use to get people to take action. What we are leading them to is to make the decision that they need to take action and get further help and need more information to decide what needs to be done.
We've tested lots of alternatives, and a two-hour event produces the best results. The event is broken into two halves. The first half is a presentation and runs 50 minutes. The second half is all Q&A and again runs 50 minutes or so. We do not offer food. When you do, you just get people coming for the food; instead, they just get tea and coffee.
The secret here is how the Q&A session is run.
At the end of the first half, we ask them to complete a Q&A form. Here is an example. [visual] The attendees are asked to complete this and hand it in at the end of the first half. The team then collects the questions sheets and can then plan the answers. In this way, we can totally control the Q&A. We can decide what questions to answer.
In the educational event, we will tell them the solutions to whatever issue we are discussing: buy an investment, take out life cover, or use a trust, for example. But we tell them that we are not advising them to do this. We can't give advice as this is an educational event and we are not selling anything. We give them enough information to be informative but not quite enough to make a decision on a solution. What they are clear about is the problem and that the problem, or problems, relates to them.
They then decide what they want to do, and the options are very clear: come to a workshop or don't come to a workshop. Remember, there is no selling; we are just giving them a decision to go further.
Here is a screenshot of the simple feedback form that they complete. [visual] As you can see, it segregates them into groups. This is very important as we want to get similar people in the room together.
Think about your practice and how you get clients to make decisions. Can you use this, or a version of this, to qualify your prospects? If you have other advisors, perhaps junior advisors, can you use this type of premeeting form to qualify whom they will meet with?
At the end of the education event, prospects hand in the forms, and, where possible, we book them into a group workshop. Remember, the objective is to book them into a workshop, not a one-to-one meeting. In 80 percent of the cases, this is not possible, and so they are called within 24 hours to book them into a group workshop.
One interesting fact is that about 10 percent of the people who said that they wanted to go further changed their mind. But 20 percent who said no also change their mind and called up after the event to book into a workshop.
So what happens at the group workshops?
The group workshop is designed to do three things:
- Allow prospects to decide what action they need to take
- Allow prospects to decide if they need a one-to-one meeting as the solutions are not clear
- Get the attendees to take action
The group workshop is much blunter and less educational in nature. In this workshop, we focus on no more than one or two problems, which have no more than three clear solutions. This makes it easy for clients to self-select the appropriate solution or establish that they are more complex and so need a one-to-one meeting.
Remember, we have qualified them and broken them into groups and we know what their issues will be, and so the workshop is designed around these issues.
For example, take an inheritance tax or an estate tax problem.
The workshop will start with a brief reminder of what we covered in the educational event and then focus on no more than three issues or problems that we know are generic to the group in the room. Remember, we have qualified them, so people in the room will all have a similar problem.
It is a workshop, so a discussion with the prospects is expected. To generate the discussion, there will be a worksheet or workbook for them to cover. This will effectively create a fact find and a decision tree for us to use later.
In some workshops, there is just a worksheet; in others, we have a 30-page workbook. It all depends on the complexity of the issues that we are covering.
For example, they will have a worksheet to complete that will calculate their inheritance tax. From this, we will have a summary of their estate going forward. We will set out the three most widely used solutions to inheritance tax, explaining the pros and cons of each, all the time answering prospects' questions. Questions are buying signals in disguise, and so the more questions, the better. An important note here is that when we answer one question, we also answer it for all the people in the room.
We are using a decision funnel so that prospects can make well-thought-out decisions.
Because prospects are in a room with other people doing the same thing, they learn from other people's questions. We then use Cialdini's second principle: social proof. Once one person decides to take action in the room, it's easier for the others to follow suit.
These workshops typically have 12 people in the room (usually six couples). At the end of the meeting, they are simply asked to complete a decision sheet on which they note what action they want to take. I have two of my paraplanners in the room, who then collect the forms, agree on a date for administration with the prospects, and book the business. In cases where a one-to-one meeting is needed, I will discuss their needs at this meeting to qualify them. If a one-to-one meeting is needed, then one is booked.
Our closing rate—people who say that they want to implement a solution—is 85 percent. That's usually 10 new clients in one go!
Think about your clients and how many have the same solution: the same trust put in place, the same type of annuity, the same critical illness cover. If many people buy the same thing, then why not sell them in groups? Just because you have always done it one way, doesn't mean you need to do it that way going forward.
Let's now move on to the review process—and this is the thing that will be a big jump for you as it was me.
Over the years, I had got myself into this position where I had to complete an annual review with clients each year. As I mentioned previously, this just started to use up my time, and so what I decided to do was to use the group technique to complete annual reviews in groups.
Now 80 percent of our clients have their annual review completed at what we call the "client review workshop."
Look at the first calculation we did. In your business, how many annual reviews or service meetings do you have?
Now think about reducing that by nine-tenths. How much time would that free up?
As I said, 80 percent of our clients have their review completed in a workshop environment and they love it as you'll see later. The biggest obstacle is us! We think that clients always want to see us one-to-one. But do they? I'm here to tell you that they don't, in fact most prefer not to.
Let me explain how we organize these workshops so that you can see what happens.
Client review workshops are all completed in January. We find that clients like to think annually, and meeting in January gives us a time to review the previous year and put plans in place for the coming year. In the UK, our tax year runs April to April, so this gives us time to do tax-year planning.
The workshops are run with between 10 and 18 people at our office, where we now have our own seminar room. When we started this technique, we didn't have a seminar room and so rented a room at a local hotel. We did this for the first four years before we moved to a larger office.
On each workshop day, we run two workshops, one at 10 a.m. and one at 2 p.m. In the past, we ran one at 6 p.m., but we found that we don't need to offer this evening option as clients will attend the daytime sessions, even if they work full-time. This is because of the value that they receive from attending.
The workshops are booked in November, and each client is given two workshop day options to select from. The clients are grouped so that we can make sure that people who run their own business are in the same room as other business owners, retired people are in a room with other retired people, and so on.
Prior to the workshop, the clients are sent a preparation sheet. [visual] As you can see, this gives us all the information that we need to update their fact find. It also asks them what they want to cover in the workshop. These forms are with us at least 30 days prior to the workshops, and so it's the clients' feedback that creates the content. By covering the clients' issues, we generate value. Here is an example of the content from this year. [visual]
If we look back at the client prep sheet, this is the part that clients complete at the workshop. You can see that we address their attitude to risk, something our regulator is very keen on. It asks them if they want to make any additional contributions to investments or pensions, and, most importantly, it asks if they need a one-to-one meeting, and when and for what purpose.
You see, what we have found is that the client review workshop covers the servicing requirement so that we sit down with people only when there is more business to transact. But we have also found another interesting point; we write more business because the clients are with other clients who have done business. It allows us to discuss other areas that may not have come up in a one-to-one meeting.
Now, when we started this, I was pretty scared, and some of my team members were not very keen. They thought it might seem impersonal, or that we were going to lose the relationship with the client. But what we have found is that the reverse is true.
By getting clients together into one room, the client loyalty is increased. The clients feel that they are part of something, that they are not alone as a client, and so it justifies their decision to be a client simply because other people in that room also made that decision.
How has this affected productivity?
If we look at this past January, we had a total of 10 days of workshops, where we had 20 client review workshops. This resulted in 336 client reviews. In just 10 days, we completed 336 client reviews. Prior to this, it would have taken me around 100 days to complete that many reviews.
By using group reviews, we have increased productivity by 10 times: 10 days instead of 100. And at the same time, we increased the amount of sales—and client loyalty.
David Batchelor, Dip PFS, CFP, is a 20-year MDRT member with two Court of the Table and 18 Top of the Table honors from Thame, England. He was a founding director of the Personal Finance Society in the United Kingdom (UK) and currently serves as UK coach for The Strategic Coach program.