Financial advisers fail to attract new clients

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The majority of baby-boomer advisers fail to attract new clients, because they don’t really want to, says Branton Mannix Consulting director Damian Hartley.

Hartley addressed the issue raised by an adviser that the industry had too many “minders” and not enough “finders”. He put the case down to three factors:

  1. Pre FoFA advisers received commissions so don’t need to be proactive if they don’t want to be.
  2. Many can’t articulate their value proposition effectively and therefor are reluctant to pursue new clients.
  3. Marketing is not recognised as a strategic function of the business and is therefore hardly documented, let alone pursued on a consistent basis.

He also said there was a lack of planning when new financial advisers were hired.

“New advisers often join existing practices with a view to becoming “client facing” advisers yet find that this doesn’t happen for any number of reasons,” he said.

He put this down to the practice principal and the new adviser having alternative ideas on what was expected of the role, and that this could be fixed from the outset with proper planning before the job was advertised.

What's your stance on attracting new clients, and will FoFA force advisers to be more proactive?

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  • Stephen Varhegyi on 9/01/2013 4:59:42 PM

    Oh yes, and no blame for consumer aversion to using advisers can be laid at the feet of sensation seeking journalists, private agenda driven socialist politicians, or the negative advertising campaigns of their cohorts. Give us a break.

  • Michael Summers on 9/01/2013 11:43:58 AM

    I agree with Wayne, but only to a point. Having fought product sales being dressed up as advice, I agree that responsible AFS Licensees' warning to their advisers has, in some cases, gone too far and has scared them off "selling" altogether. They need to understand the difference between selling product and selling service. A popular doctor's sales presentation is called " bedside manner" - financial planners need to be able to communicate and to establish rapport with their clients so that they not only provide best interest advice but they sell themselves to their clients - this leads to return and referred business. It is a sales process. We still, however, have to be aware that for some businesses "soft skills" is code for "handling objections" and other old product selling processes.
    "Minders" are only order takers whose value to a business is not great. Advisers who sell themselves and the business to clients add value.

  • Geoff Whiddon on 9/01/2013 11:34:05 AM

    Our education of advisers is also lacking in the ability to find clients. You can be as technical as you like but if you cannot attract new clients your business will ultimately fail. It doesn't matter what business you are in, everyone who relies on someone else to pay them money needs skills to be able to ATTRACT and RETAIN clients. There is a big skills gap that needs to be filled in the very near future.

  • Wayne Leggett on 9/01/2013 11:06:39 AM

    The only surprise is that this is considered news. As soon as we became too "good" to think of ourselves as "salesman", all cultivation of "sales" skills ceased. Almost all industry recruiting for the last 25 years has been directed at "minders" rather than "finders". Is it any wonder it is such a big problem? Worse still, it will take as long to remedy as it has taken to create the problem in the first place.

  • James Howarth on 9/01/2013 11:06:17 AM

    What force us to work and force us to work for free, or even less than potential litigation costs.

    Who would bother at all.....

    ASIC should ban advisers all together and Everyman for themselves.I kid offcourse, but adviser are leaving on their own accord.

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