How your clients can lead you to others

The best way to attract high net worth clients is through personal introductions and client referrals, and if a prospect fails to meet your targeted income or asset levels, you should refer them on to someone else.

That’s the word from experts Russ Prince and Karen File, who have conducted extensive research into the high net worth market in the United States.

Personal introductionsand client referrals

Many successful financial planners rely solely on their existing client base to provide them with personal introductions and referrals to grow their business. Prince and File say this approach is even more critical for the high net worth market, where trust and satisfaction are central to success.

They say that it is important to set the expectation in your clients’ minds at the outset that you will look to them to provide you with introductions and referrals. As the relationships develop, and your clients’ satisfaction with your work grows, you should ask them for introductions and referrals to any potential like-minded clients. Once this occurs, they recommend contacting your client to thank them and then again later to inform them of your progress.

A systematic approach to targeting your existing client base in this way will yield the best results, as well as reinforce in your clients’ minds that you regard the relationships highly.

Referrals from otherprofessionals

The next most effective method for attracting new clients, according to the experts, is through referrals from other professionals. The success of this approach will depend on the quality of the relationships you develop with other professionals, which will be determined by the added value you can bring to their clients and the degree to which your business interests can be aligned.

These relationships could also include cross referrals, or even joint marketing efforts.

Prince and File recommend that relationships with other professionals be formalised to protect the interests of both parties. In addition, these arrangements should be reviewed on a frequent basis to ensure that both parties are continuing to benefit from the arrangement, and any required modifications made.

Seminars

Seminars can be a highly effective way of supporting your business and can often work well as part of a joint marketing effort with other professionals, with whom you have developed referral arrangements.

Prince and File say seminars should be specifically designed with your audience in mind and must be dynamic in their presentation. It is also important that you limit the numbers attending and that each seminar has a strong hook to attract the necessary audience. Aligning the content of your seminars with your clients’ interests is the best way to do this.

A seminar must contain some form of call to action, which will motivate your audience by appealing to their core goals or needs. You must also follow-up with each of the clients who attended, on a one-on-one basis.

Public relations

Developing a public relations strategy is the best way to enhance your profile as a sought after adviser, according to the experts. This could involve publishing a newsletter or book, writing a regular article for a magazine or publication that is typically circulated to your target market, or developing a reputation as a sought after presenter and speaker.

Advertising

Advertising can help to build your image with your target market and is most effective if you advertise in a magazine or publication that is typically circulated to your target market.

But Prince and File argue that while some form of limited advertising can prove effective, it is generally the domain of larger institutions. Advertising rarely attracts enough high net worth clients to make it a cost effective strategy for small practices.

Direct mail

The high net worth market does not typically respond well to direct mail. It is hard to do well and it is unlikely to be cost-effective.

Cold calling

Prince and File say that cold calling is highly unlikely to succeed with high net worth clients, and is best discarded as a prospecting strategy.

Justin Brooks is head ofbusiness development inNSW and Victoria forCredit Suisse Asset Management .