One-off clients pose ‘untapped opportunity’ for growth

Unlocking the potential of one-off clients and transitioning them into ongoing advisory relationships start with reducing fee barriers.

According to Adviser Ratings, the total amount paid by consumers in fees to financial advisers in a year is estimated to be approximately $7.4 billion.

This figure includes two key avenues for how advisers charge their clients: recurring fees, typically charged on an annual basis; and one-off fees, charged for single consultations.

Advisers are observing a rising number of one-off clients, Adviser Ratings’ research demonstrates. The proportion of this client segment has grown from 20 per cent in 2020 to 25 per cent in 2024. In comparison, recurring clients have slightly shrunk from 80 per cent four years ago to 75 per cent currently.

“While recurring clients provide stability, this growing segment presents an untapped opportunity for market expansion. While these clients might only seek advice once, they could be the key to unlocking long-term relationships and revenue,” the research house stated.

VIEW ALL

View all

Although the dollar amount charged for a single meeting varies depending on the number of hours and the complexity of advice provided, the average fee for this type of consultation is $1,700.

This figure directly contrasts what unadvised Australians are willing to pay for one-off advice, which sits at $651 on average – creating an evident cost barrier.

“Addressing this issue is crucial to attract these clients into the advisory world. Leveraging technology to reduce costs can make financial advice more accessible and appealing to a broader audience.”

Earlier this year, Money Management discussed with advisers how much they charge for an initial meeting, with some opting to charge and others offering a free session as a way to prompt further sessions.

Research from Elixir Consulting in its Advice Operations Research Report 2024 found the number of people with the volume of advisers surveyed who charged for the first meeting was 19 per cent, up from 9 per cent in the previous report in 2020.

Continuing, Adviser Ratings encouraged advisers to consider methods that could bring down the cost of providing one-off advice to new clients, whether it be through technology or harnessing support staff.

By getting new clients through the door with a more affordable fee, advisers can then focus on recognising the potential this cohort presents to form new recurring relationships.

“By making financial advice more accessible and demonstrating its value, we can encourage them to see the benefits and eventually commit to recurring advisory relationships.”

In addition to reducing fees, effectively articulating the value of advice is another critical step in transforming single-session individuals into ongoing clients.

This includes communicating the tangible financial benefits of advice where possible and framing outcomes in terms of the emotional benefits, rather than keeping investment performance as the focal point.

With consumers often seeking financial security and peace of mind, it is imperative for advisers to emphasise how they will achieve these benefits to help one-off clients see the worth of recurring advice.