Pierre Bossaert, Vice President of Product at Fiserv, recently wrote an article entitled, “Advisors Must Expand Product Offerings and Approach”. In the piece, Bossaert addresses one of the most imminent challenges faced by the financial services industry today: How can advisors remain relevant to “NextGen” investors? NextGen (Gen X + Gen Y) investors are a vastly different breed than the Baby Boomer generation most advisors have grown accustomed to working with.

These younger investors have accumulated investable assets [however] their preferences for interacting with advisors are likely not being met by the advisory model that has proven successful for baby boomer clients. While most baby boomers prefer face-to-face collaboration and printed financial plans, NextGen investors are accustomed to electronic, fast-paced engagement styles. …As baby boomers retire and spend their assets, NextGen investors are in accumulation mode, saving for a variety of life events. If approached effectively, advisors can engage them as long-term investors.

Why should advisors care? Because they’re taking over the market. Currently there are 75% more NextGen consumers than Baby Boomers. Factor in attrition rates, and their dominance of the financial services market only becomes more dominant.

Why should advisors care now? Because they’re here. In less than 24 months, the NextGen group begins to hit age 35, the beginning of peak earning years. Tomorrow’s too late. These investors are here now.

So, what to do?

4 Steps to Survive ‘NextGen Revolution’

First, you must understand their unique perspective on financial markets.

These investors lived through the stock market highs of 2007, followed by the 2008 economic recession and are now accustomed to volatile markets, high unemployment rates and rising health care costs. As much as they want to retire comfortably, NextGen investorsalso have to worry about their present-day financial situation.

Second, you need to understand what this all means for your business.

They are likely to pursue a self-directed investment strategy, and proactively utilize online resources. …While they are more likely to seek out information on their own, especially if their financial advisor isn’t quick to respond, they still need validation that the information they have obtained is correct. This “trust, but verify” approach is the reason many advisors are adding Personal Financial Management (PFM) tools to their technology systems. PFM offers a reduced level of advisor-to-client engagement, so the overall management of finances is more collaborative.

Third, you need to make serious changes to the way you do business, and now.

To provide the best blend of advice and self-service requires a web-based unified wealth management platform with client-facing portals andinvestor needs-analysis capabilities. These tools provide the transparency that investors are seeking, while also allowing an advisor to garner enough detail to effectively manage their client meetings. Accessible via apps on tablets, smartphones and browsers, these financial advice management tools facilitate the creation of proposals, suggested plans and reports on-the-fly to meet the expectations of fast-paced investors.

Last but not least, recognize and appreciate the fact that the tools required to service NextGen investors will actually improve your bottom line.

Technology tools available today make data collection more efficient and save investors and advisors the costs related to old-school information gathering. An online experience helps advisors save time and energy as it facilitates on-demand live interactions with their clients, eliminating the need for one party to physically travel to meet the other. Recent advances in client-facing portals enable financial advisors to present liability information and financial strategies in a clear and relatable fashion. Seeing their portfolio strategies elegantly illustrated is a significant draw for NextGen Investors who are looking for ways to pay down liabilities and improve their cash flow.

Bossaert warns readers it’s time to pay attention. We’re about to hit a financial service revolution driven by the wants and needs of these dynamic investors. He left readers with a final thought: “Advisors that can attract the next generation of investors today with custom, convenient and transparent financial advice will have an array of assets to manage in the future.”

Jason opened his first office in Michigan where he focused on baby boomers and retirees using seminar marketing. The firm grew quickly. Fast forward to 2010, Jason had added two employees and opened his first satellite office.

Sounds perfect right? But, there was a problem.

Growth began to slow as scale was difficult to achieve serving only local clientele. See, Jason, like a lot of financial advisors, has always been an over-achiever. At 19 he started his career as the youngest of more than 50,000 Morgan Stanley employees, building software for advisors to use internally. After years of working 80-hour weeks in their back office, he decided he could deliver advisory services at least as well as the people he was supporting. So he left and began to build the framework for Retirement Wealth Advisors, his SEC registered RIA.

Missing his growth goals wasn’t an option. But the growth and service approach Jason used when his business was small had become too time consuming to continue. He realized that he could continue on his current path and grow incrementally by offering slightly better services than the competition, using old-school marketing, and waiting for referrals. Or he could radically rethink his business. He could remove every part that was limiting him and replace it with new tools that could help him grow exponentially.

Open minds see open opportunity

He started by envisioning a firm where, rather than focusing on the local market, he could attract and support clients nationally. In removing geography as a limit to grow, Jason dramatically increased the size of his potential market. It also meant he could be more focused on the kinds of clients he wanted to work with. One additional benefit of thinking nationally was that his firm could pursue many growth strategies that weren’t feasible at the local level.

It began to work. However, the strategy created a new challenge. Jason had to develop a new service model that could support a national client base. In person meetings becoming more and more challenging. He realized he had to either open offices all over the country and staff them, or find a more centralized way of serving clients remotely. He also needed to eliminate every process that clients didn’t actually value and focus on doing the few things that clients cared about. On top of everything, he wanted to deliver those services much better than local competition. For Jason, that meant leveraging his background in technology to find a solution.

Needing a swiss army knife, not a fork

As an expert, Jason knew he’d need to focus on a few key areas for clients: 1) service experience, 2) self-service, and 3) communications. He believed he could actually improve the service experience by improving client meetings. He knew he could make them more focused and eliminate the need to travel by conducting virtual meetings. To do it, he’d need a very simple web conferencing solution that was easy for clients to use. He would also need a client portal that allowed his staff to walk clients through their situation in a simple, easy to understand format that was automatically up-to-date. In addition to focused meetings, using a live portal would eliminate hours of meeting prep time for his staff. It would also reduce requests for new information from clients that he’d seen using static client vaults. Client onboarding would become simpler and more automated too. But most importantly it would let clients see all their assets in one place from anywhere.

Jason also knew he’d need to be able to service everything that the client owned even if it wasn’t in his custody. That meant needing to include all the client’s assets in the client portal in reports and client meetings. By allowing clients to add all of their accounts into the portal he could give better advice, and eventually those assets were likely to move to him based on his ability to service them before anyone else. That meant account aggregation.

With a client portal and account aggregation Jason didn’t want to get caught in the trap of having his staff maintain held-away accounts in a separate system and he didn’t want to be in the position of middleman if accounts needed to be maintained. That meant he needed account aggregation integrated deeply with the client portal and the system would need to be focused on helping clients to help themselves.

By using a client portal Jason hoped to eliminate the traditional, quarterly reports in favor of on-demand information and an automated system of relevant client contact. By allowing clients to login to the portal anytime they had a question he also hoped to reduce the number of support calls, since his clients would be able to answer a lot of those questions on their own whenever they wanted. The goal was better, more convenient service for more clients. His strategy was not either more clients or better service, it was more clients AND better service. A combination achievable only by massively increasing efficiency.

Simplicity, transparency and a service breakthrough

Jason first stumbled on Blueleaf’s client portal in September of 2011 in an Investment News article. After doing a little research he became an early adopter, because he believed in the Blueleaf vision of simplicity for advisors and clients.

One of Jason’s main goals was to improve the client service experience. Jason introduced Blueleaf to his clients and in his words “They loved it. In the past I’d used a lot of client portals and had never gotten a single compliment on any of them. This is the first system where I regularly get compliments, phone calls and emails that make me blush. Blueleaf is a referral generating machine. Clients love it, and they tell their friends about it.  I also use the portal to court new clients. Once prospects see it they want it.”

Jason is a big believer in the importance of regular client communications. In fact, he reaches out to his clients between 120-150 times per year. “With any business, but especially with a virtual business, it is important to regularly communicate with your clients,” Jason explains, “Blueleaf sends out a weekly automated email update which includes my name, my picture and the name my firm. Think about it, that equates to 52 automated client touches per year with exactly what the client wants to know: ‘what do I have? & how am I doing?’ Try it and you will find it’s incredibly helpful in establishing relationships with clients.”

Jason describes Blueleaf as, “making his life easier by gathering all of his clients’ assets in one place. Anyone who has used most of the larger aggregation services is probably familiar with how complicated their portals are. Blueleaf is the opposite. It is also immensely helpful to really know where all their assets are, how they’re allocated, and how they’re performing. Identifying external accounts is now an integral part of my onboarding process.” As an added bonus, Blueleaf also integrates with the other systems that Jason uses (like Redtail) to eliminate the need to manually re-enter data and manage multiple connections for each software system.

Clear blue sky ahead

For the last 2 years Jason has focused on building a virtual advisory where almost everything is done online. This change has allowed him to shift his focus from local clients to offer his services nationwide.  His cost to acquire clients is a fraction of what it used to be and he can be more specific about the type of client he wants to work with since the market is so much bigger now. The growth rate is higher than it’s ever been and his practice is scalable which allows him to grow much more efficiently.

Jason contributes a lot of his success to, “technology, like Blueleaf. Retirement Wealth Advisors now has 14 employees and $104,334,901 in AUM.  I would encourage anyone who is interested in building a business that is largely virtual to try Blueleaf. It’s a world class technology that is changing the world of wealth management.”

April is notoriously painful for advisors. There’s a myriad of reasons to dread the 4th month of the year. It’s tax season, time for billing, Q1 reports (if you’re still doing them), schools are on vacation… the list goes on and on. Naturally, busy times of the year come with a piqued interest in ways to save time.

I’m constantly chatting with advisors, all with different strategies and objectives. The common thread across my various conversations, however, is an overwhelming interest in saving time. Many advisors are trying to grow their firm, so inefficiencies in their practice today just hold them back from growing bigger tomorrow. Other advisors are less interested in growth and more interested in running a lifestyle business. These guys still want to increase efficiency, though, because they’d like to spend more of their time out of the office.

Knowing this, it comes as no surprise that the question of the month was: “Is there a way to make my busy April suck less?”

Don’t be April’s Fool

Breaking News: April doesn’t suck for everyone. While I do speak with advisors who are struggling, I’ve also been talking to advisors coming off their best months and quarters ever. One financial planner has stopped chasing clients for statements. How? He implemented an account aggregation tool. Another advisor, who was once plateaued at $40mil AUM, is well on his way to $200mil AUM. How? He found a way to automate his reporting process.

These guys aren’t April’s Fools. They were tired of suffering through inefficiencies in their business so they actively sought out a solution. Their struggles became so infuriating that they kicked their habit and are now better off for it. The really exciting news is that YOU can, too.

Einstein will think you’re a genius

If you want to be more efficient, you’d be insane to shy away from change. Einstein (who was a relatively smart guy) once said, “The definition of insanity is doing the same thing over and over again and expecting different results.” You’ve suffered through another April, so what are you going to change for next time?

Let’s brainstorm solutions. I enjoy helping advisors become MORE efficient, or hearing about the ways you already are. In the comments below, I invite you to respond w/ one (or more) of these:

A) My April was horrible because …
B) I was more efficient this April because …
C) In general, I really want to be more efficient with …

As an advisor, your LinkedIn profile and ‘Connections’ serve as a powerhouse for business growth. LinkedIn is a powerful tool for client prospecting, receiving referrals, keeping in contact with the people in your network, and more. If you’re not on LinkedIn, read my post on how to get started in 5 steps. If you’re already set up, here’s some exciting news.

Today, LinkedIn announced the launch of LinkedIn Contacts - “A smarter way to stay in touch with your most important relationships.” The new feature is only available for select users at the moment, but will be released to everyone soon. For the majority of us who have to wait for this new tool to appear on our LinkedIn dashboard, let’s spend this time preparing how we want to use it to our full advantage. If used strategically, this new feature could be a golden key to growing your book of business.

Why you’ll love “LinkedIn Contacts”:

1) It organizes all of your activity with each contact, across platforms

The tool syncs with your address books, emails and calendars. It organizes and summarizes all of your communication with each contact and populates their profile with details about past conversations, meetings, and notes you make. This kind of organized information about your relationship with each contact will help you build more meaningful relationships with both clients and prospects. Have your second meeting with “Adam Smith” in one hour? Whip up his LinkedIn contact info to see notes from your first meeting, the interesting article he shared with you yesterday and remember who referred him to you in the first place.

2) It notifies you when important things happen to your connections

The tool will send you alerts and/or emails when connections have birthdays, change jobs or if you haven’t reached out in a while. Take advantage of this feature so you can proactively stay on top of key opportunities to reach out to clients. Important note: These alerts include the ability to set up custom alerts. I’m getting the sense that these alerts will be incredibly powerful. Rumor has it users who have travel plans can also receive suggestions to connect with local contacts near the area. Whoa.

3) It’s all available on-the-go

Advisors are constantly on-the-go. Between client meetings, networking, and running a business, you’re a mobile bunch. “LinkedIn Contacts” will be available as it’s own mobile app. You’ll have access to all of this powerful information, on demand, wherever you are.

In short, this tool can help LinkedIn members better organize, maintain, and nurture all of their relationships. Is this possibly the new CRM solution for advisors? Perhaps. Just think about all the ways it could be helpful as an advisor.

“My clients aren’t tech savvy.”

Many advisors throw around the claim “My clients aren’t tech savvy” as if they know what they’re talking about. If you find yourself saying this, know that you’re making an assumption. It’s not based on facts. Regardless of how confident you feel or how much you think you know your clients, this statement is not widely true.

Before we continue, I’d ask that you answer two simple questions:

1) What percent of your client base did NOT graduate from college?

2) What percent of your client base has a HH income of LESS than $50,000 per year?

Scribble down these two percentages on a scrap piece of paper. They’ll mean more to you in about 60 seconds.

Research says they’re online.

A few months ago, Pew Research* conducted a survey to measure internet usage by various demographic segments. They surveyed 2,200+ adults, 27% of which were 65+ years of age. Internet use was studied between differences in gender, age, race, education, and annual HH income. The research found that the statistically significant measures were (a) education level and (b) annual HH income. So, based on research, do your clients use the internet?

Was your answer to #1 above a small percentage?  The study found that 98% of adults who graduated college use the internet.

Was your answer to #2 also a small percentage?  The study also found that 90% of adults with a HH income of $50,000 – $74,999 use the internet, and that percentage jumps to 98% for adults with $75,000+ in annual HH income.

“Data doesn’t lie, yo.”

If you’re about to dismiss these statistics as ‘not applicable to your client base’ for whatever reason you think is legitimate, read on.

“Data doesn’t lie, yo.” This is one of my favorite pieces of advice from a business mentor. Okay it’s not advice, per se, nor is it the most eloquent sentence ever formed, but it sticks. It came about when results of an online campaign yielded very unexpected results. Our customers behaved in the exact opposite way I assumed they would.

I was struggling to believe the numbers in front of me, when my mentor simply said, “Data doesn’t lie, yo.” It was a ‘Haha’ statement followed by an ‘ah ha’ moment. I began to realize that my assumption (despite how confident I felt) was simply that – an assumption. I understood that I’d be foolish to base any business decision on a hunch. I need data. So, I swallowed my pride, embraced the numbers, and then leveraged the information to improve the business. “Data doesn’t lie, yo.”

So, the Pew Research data isn’t lying to you. However, if you still need convincing, here are 3 ways to collect your own data.

3 Ways to Test Your Assumption:

1) Visit each client’s home for 24 hours.

I’m only partially kidding. There’s actually a legitimate data collection method called observational research. It involves watching your subject (in this case, clients) in their natural environment for a significant period of time. You would need at least a full day to fairly evaluate their internet use. While it would certainly be an informative experience, this method isn’t realistic, so let’s move on.

2) Survey your clients.

Write a survey to collect relevant information about how your clients. The key here is to ask for facts, not opinions. For example, instead of prompting them to rate how tech savvy they are, ask them to list types of devices they have at work and at home, total number of emails they receive each day, or what their three favorite websites are. Offer a “not applicable” option in case, but you may be surprised by their answers.

3) Conduct an experiment.

Run a test without directly asking clients anything. Sign up for a technology that intrigues you. Many online tools offer a free trial period, so take advantage of it! Actually use the tool with a portion of your clients and wait to see how they react. Do they rave about this new addition to your service? Does your relationship with the client remain the same, but your business efficiency drastically improves? Try something for free and see what happens. You may have an ‘ah ha’ moment of your own.

If you want to learn which technologies other advisors are using, read our 2013 Tech Survey Report. It’s free!

*Source: Pew Research, Dec. 2012, “Who’s Online?”

Introducing new technology to clients can be a challenge.

Let’s face it, whether you are a technophile with all the latest gadgets or someone who has just started to hear about a new company called Facebook, most of us are not experts at consumer behavior with technology. So rolling out new systems for your clients may create a little apprehension.

Will they like it, will they use it, will it help my business? Lot’s of questions. Let’s take a look at how to incorporate new client facing technology and roll it out successfully to your clients.

What your clients “want” doesn’t matter

When advisors are thinking about new client-facing technology, a common first instinct is to ask clients what they want.

Big mistake.

Getting clients involved in the process is critical, yes. But asking them what they want will send you down the wrong path. It turns out, we are all terrible at knowing what we want if it’s not closely related to what we currently have. Essentially, you’re asking them to predict the future. Not so easy. It’s one of the reasons that the best product companies on the planet (particularly in technology) never ask us “What do you want?” or “Would you use this X product that you haven’t even tried yet?”.

Understanding problems is the key

Instead, ask clients about their problems and challenges. Focus on how they currently handle the thing you hope a new system will help them with. For a client portal it might be a series of questions like “How challenging has it been for you to get a complete financial picture?” and “How much time do you spend gathering your financial information?” Questions that identify problems and challenges are magic questions for learning more about your clients.

People tend to be very specifically and vividly aware of what is painful or expensive for them. That specificity is gold. You may also want to include a few questions that may indicate the conditions that create the problem you’re trying to solve. In the client portal example, it might be question like “How many institutions hold your assets?” The answer “a lot” indicates a potential need, “one” less so.

By getting clients to discuss their challenges and frustrations you’ll be in a much better position to think clearly about what solutions can help solve those issues. Even if you’ve already picked a technology, starting this way allows you to frame what you’re doing in the context of the challenges they’ve just shared with you. e.g. “We’re about to roll out X and I think it might solve some of the challenges you just mentioned. What do you think?”

This approach will help make the conversation much less abstract and you may even learn something new about your clients. There is a lot more to say about how to offer new services and we’re planning to write a lot about it in other posts. For this post, we’ll focus on rolling out a new service once you’ve done your homework and made the decision.

Aim small, miss small

The simplest way to start is by picking a few clients to talk with. These clients should be representative of your base and be people you think will be able to give good feedback. What is ‘good feedback’? Good feedback is clear, specific and focused on answering the question “Did we solve the problem we set out to solve?” and “Have my changes made clients happier?”

The key is to set yourself up to get feedback from actual client experience that is focused on solving a problem. With a client portal, you may be setting out to solve the problem of seeing everything in one place or more easily sharing information, or having clients feel a sense of clarity and transparency around their money. What ever it is you set out to do, ask the clients about their related problems.

In general, actually rolling out a system is straight forward. The amount of work needed per client depends on the complexity of the system and that, in turn, governs how quickly you can roll out without an overwhelming amount of support requests. Even with the simplest systems that provide great support, like at Blueleaf, you’ll probably want to divide your client base and roll the system out in pieces. With easy-to-use systems, 20 clients per week is a reasonable roll out pace with minimal disruption.

Communicate and K.I.S.S.

A good roll out process starts with communicating clearly with clients; what you’re planning, why you’re doing it and why it benefits them. Focus on a handful of key benefits that solve the challenges your clients have. Good systems can do many things. Roll out isn’t the time to share a laundry list of all the features of the solution. Keep it simple. Make a list of 2 or 3 bullets (Not paragraphs) and tell clients “The system does A, B and C and lots more. It’s fantastic and we’re excited about how it will help you.” That’s it. Less is much much more.

In the roll out process, DO NOT anticipate concerns in your communications, another common mistake. Among advisors this is particularly true with the topic of security. In an effort to be thorough or save time, advisors frequently raise issues they think clients “should” or “probably” care about. Stop now. By doing this you are creating issues not solving them. If your clients have concerns, they will ask. Have answers ready, but don’t force the concerns of the few on the many. It merely complicates otherwise simple issues.

Eliminate as many sources of friction and client effort as possible. If you’ve written 3 paragraphs in an email, get it down to 3-4 sentences. If you’re thinking of a process with 3 steps, make it 2. However, and maybe counterintuitively, DO NOT do all the setup work for your clients. For client facing technology, client involvement in setup is critical for their future engagement.

If a client is unwilling to take an hour to do something, they may be too busy. If a client is unwilling to take 5 minutes, then that should be a signal about the value that this client sees in what you’re doing. Double down on your communication, clarify and try again.

Lastly, don’t expect 100% adoption of any system, no matter how good. Great systems see adoption around 50%. While better can happen, and I’m proud to say Blueleaf sees it often, focus on an achievable target. If you get 55% of your clients to adopt, you’ve done well and improved the lives of over 1/2 your client base. 

Emotionally attached to your Ford Pinto?

Humans are creatures of habit and habits are hard to change. Whether we realize it or not, we become emotionally attached to them and tend to shy away from better ways of doing things.

Quarterly reports fall into this bucket – they’re an unnecessary client communication vehicle that’s only still around because of a habit. If you’re still generating quarterly reports, you’re driving a Ford Pinto. The only difference? Quarterly reports can’t be recalled by the manufacturer.

A couple weeks ago, I shared exciting news from an advisor, James, who was celebrating his first “non-quarterly report” quarter.  That’s right, he has completely eliminated the need for sending out quarterly reports. He broke his habit. As you know, this is a huge change. (Enjoying your April, James?) Recently, it dawned on me that some of you may not feel quite ready to free yourself from the habit of a quarterly reporting process, so today I offer a small stepping stone. Keep in mind, we’re putting a band-aid on a Pinto.

Try a new set of tires.

For advisors who want to continue quarterly reports, let’s start by changing the final step of your office’s process: Sending reports to clients. There are alternative options to physically mailing the reports you made. An obvious alternative is sending them online. Sending reports via the internet is actually more secure than via the mailman. Think about it – a mailbox at the end of a driveway has no lock on it. Online accounts have passwords. We’re already more secure online than not.

To send the reports online, there are two quick options. First, send it via email. Save the report file, write a quick message to the client, and click ‘Send’. Done. A second option is send it through a file-sharing service. There are many services out there (i.e. Dropbox), so just take your pick. Upload the file, create a log in for the client and let them know the report is online waiting for them.

Boom! No more paper or ink, folding or licking, address labels or stamps. Attach a file and push a button. Your beloved Pinto will move from point A to point B on a new set of tires.

Junk the Pinto.

After a quarter or two, you’ll grow more comfortable with this new way of thinking about reporting and your clients will be thanking you for reduced paper-shuffle. Soon you may feel ready to junk the Pinto altogether. Congrats! You’ve made a huge leap toward tech-enabled efficiency at your firm. One small step for man, one giant leap for… you get the picture. Now, here’s the best part: Your time savings from junking a quarterly-reporting-Pinto-process will more than pay for an alternative solution.

After all, who wants to clunk around a Pinto when you can drive a Lamborghini?

There are a bunch of articles on “Top ways advisors should use LinkedIn to do this complicated thing and that fancy thing!” But it feels like no one takes the time to simply explain “How advisors can get started on LinkedIn in case (heaven forbid) you’re not set up yet”.

Don’t have a LinkedIn profile yet? Want to be coached through it? Have no fear. Blueleaf’s got your back.

Follow these 5 simple steps.

1) Check with compliance.

Compliance can be a first concern for advisors who are about to join LinkedIn. If applicable, learn about the company LinkedIn compliance policy. This shouldn’t be difficult or take too much time because chances are you won’t be the first to ask. Keep in mind, compliance often explains what you can’t do, but neglects to say what you CAN do. Play around on LinkedIn and appreciate what you CAN do with the features, rather than harboring on what compliance says you can’t.

2) Sign up.

As with many things, the biggest hurdle is getting started. Sign up for LinkedIn. The site makes set up quick and easy by walking you through the first basic steps, so don’t feel intimidated. Go to www.LinkedIn.com and, as Nike says, “just do it.”

3) Write something in your profile “Summary”.

Sure, you will list your job title, company name, past experiences, and education. However, you should spend most of your time and energy writing a few strong sentences in the “Summary” section. This is the part of a LinkedIn profile most people actually read. It’s your chance to mention your background, advisory services, and list a few specialties. Keep it brief – no more than 7 or 8 sentences. If you need a little inspiration, read the Summaries of your colleagues or (better yet) your competition. How are they using the space to communicate with the LinkedIn community?

4) “Connect” with clients.

On Facebook people have “Friends”, on Twitter people have “Followers”, and on LinkedIn you’ll have “Connections”. Connecting with clients should be a no-brainer for advisors, but many don’t. It’s a valuable means of communicating with many clients at once. Plus, you’ll get insight into their network and potential referral opportunities.

Don’t feel overwhelmed by the length of your client list. Take it in bite-sized chunks. Make a point to search LinkedIn for X number of clients every day until you’ve searched for them all. Enter a client’s name in the search bar, find them in the list, click the blue “Connect” button and write a quick sentence to personalize the invitation. They’ll appreciate that you reached out. Now, here’s where the magic happens.

5) Be active.

Ok, you’re signed up and have a growing list of “Connections”. What now? Do stuff. In general, being active on LinkedIn means two things: (a) commenting on what your connections post (appear on your Home feed), and (b) sharing useful content that will appear on your connections’ home feeds. Commenting on others’ posts makes you visible to their networks (cool, huh?) and add a personal touch to your service. Then, posting things yourself via a status update will help you establish yourself as a thought-leader. Take a few days to watch how others share content and don’t be scared to give it a whirl. I bet you’ll be pleasantly surprised with the dividends.

BONUS!

You can also use LinkedIn to “join groups” and “follow” companies. This is a great way to get information that is most interesting to you. Click here to see Blueleaf’s LinkedIn page. Follow us! We post interesting articles, offer free downloads, and share other cool stuff.

Is this viewpoint nuts?

Recently I wrote about the Silent Advisor Killer - Cost of Acquiring Clients (CAC). In the discussion that followed, there were a number of advisors that disagreed with worrying about the relationship between CAC and the first year margin (FYM) earned from a client. An argument against the importance of the relationship between CAC and FYM went like this:

Bryan’s comment:

I hope my competition views it this way. If it costs me $1.50 or $2.00 to acquire $1.00 in revenue the first year, I’m thrilled to pay that. Because I know that I’m likely to have that client for 10+ years, and I already know the cost to maintain that client is about $0.25 – $0.30 per year for every $1.00 of revenue. So I can outspend my competition for marketing and advertising if they’re short sided in their thinking to build the long term success of my practice.

To be frank, I read this and thought it was nuts. I figure it means there is a large group of advisors that need a remedial education on working capital. But then I realized something. The other potential assumption came from a completely different view of the world. A view rooted in very slow growth where adding 2 or 3 clients is the reference point. In that case, the sentiment isn’t nuts, but it certainly won’t help accelerate growth for your business.

Let’s take a look.

Working through the cost of Growth

In this quick screencast, let’s use the tool below to see how your growth rate and  CAC ratio impacts the cost of growing your business. [Hint they don't behave the same.] You’ll learn that the bigger you want to become and the faster you want to grow, the more critical your CAC ratio is to achieving your business goals.

Downloadable CAC Tool

Here is a very simple tool I built to help illustrate these relationships. Could it be more sophisticated? Sure. But it will help you build the intuition you need to think clearly about the impact of your growth aspirations on your business finances.

The key variables to play with are Annual Growth (B3) rate & CAC ratio (B9). Play around with the numbers and watch how at even modest growth rates (10-20%) working capital needs are substantial. More interesting is changing CAC ratio.

The base example is from our previous post. While we discussed having a First Year Margin (FYM)/CAC ratio of less than 1, I’ve set it to a our goal at Blueleaf of .5. In the comments many readers said they’d be happy to pay $21,600 for a client with a first year value of $20,000. Set the CAC Ratio to 1.08 and see how the working capital needs change. I hope it’s eye opening.

Have fun.

03/28/2013, 9:06am EST – Breaking News from J.E. Wilson Advisors, LLC

This morning we received an email from a Blueleaf customer that generated some hubbub around the office. With the customer’s permission, we’d like to share his firm’s good news:

“John- We are looking forward to our first “non-quarterly report” quarter. Should make the first week or two of April more enjoyable.” 

- James E. Wilson, CFP

That’s great, James! Thanks for sharing your good news with us. We are so thrilled. This is exactly the type of impact we know Blueleaf can have on wealth management. Cheers to you for making the change.

Hello to on-demand reporting with push-button ease, available to you and your clients 24/7.

Goodbye to expensive, time-consuming quarterly reports. Sayonara. Don’t let the door hit you on the way out.

One of our Blueleaf Coaches, Justin, rattled off a slew of numbers that can really put this in perspective: “Think about it – an average quarter is 13 weeks and it often takes 2-3 weeks to generate quarterly reports… 2 weeks times 4 quarters, that’s 2 months of the year. Multiply that by the salaries of 2 employees, and BOOM. Years of Blueleaf pay for itself after ONE QUARTER.”

Times are a changin’. Efficiency is possible. The next time you think, “There’s gotta be a better way…” look for one.