Growing your business

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  • 36 mins 49 secs

Learning: Structured


  • Robert Poulten, Business Consultant, Quilter Financial Planning
  • John Kerr, Recruitment and Establishment Director, Quilter Financial Planning
  • Paul Young, Head of Business Consultancy, Quilter Financial Planning

Learning outcomes:

  1. Distinguishing between the types of growth an adviser business needs to focus on: staff, clients and profitability
  2. The importance of building a sustainable growth model
  3. Why staff retention is as important as staff recruitment

Testimonials - A Trojan Horse to Referrals

Channel: Akademia
PRESENTER: Hello and welcome to this Akademia session on growing your business. Lots of advisers want to grow their business but how do you go about doing it? What should you focus on, what support might you need? Well to discuss that I’m joined here in the studio by three members of the Quilter Financial Planning team, who’ve had many years of experience in helping advisers to successfully grow their businesses. Let’s meet them. They are Robert Poulton, Business Consultant, John Kerr, Recruitment and Establishment Director, and Paul Young, Head of Business Consultancy. Before we start today’s session, let’s look at the learning outcomes. Firstly distinguishing between the types of growth an adviser business needs to focus on, staff, clients and profitability; the importance of building a sustainable growth model; and why staff retention is as important as staff recruitment.

Paul, let’s start with you. Now I believe Quilter’s been doing some research recently that shows around 50% of advisers want to grow their business in the next three to five years and a further 38% are looking to sustain their current levels of business. Did that surprise you?

PAUL YOUNG: No, and I guess hopefully the audience when you think about it won’t get surprised about it either. And I guess it’s backed also by our conversations with firms, it feels roughly about right. That 12% figure obviously of people who aren’t interested in it also seems to gut feel tie up with how many people are looking to exit in the next couple of years as well. But I guess if you’d look at the sort of the 38% piece as well, about sustainability, even when you talk to those firms, they do want to replace any people who perhaps exit or mortgages that finish or people who die whatever, so there’s still an element of growth in there if it’s the right type of growth. But I guess it’s that balance. It’s the desire balanced with the capability and the capacity to do it, doing it in a way, you know, you actually balance everything else, but done in a sustainable way, and that’s the challenge I think.

PRESENTER: Rob, when you look at growth, there’s lots of different types of growth, we can talk about growing, so what would you say are the key ones to focus on, particularly picking up perhaps on the sustainable point?

ROBERT POULTON: Well, we tend to look at three I think really Mark. Firstly is, and again in no particular order, there’s growth in the numbers of advisers clearly, and the issues around there around recruitment but increasingly important of course retention, and then secondly growth in the number of clients of course and in particular the right type of clients for a firm, and then lastly growth in profitability and sustain it, help key to get sustainability into the firm, we look at profitability.

PRESENTER: And, Paul, just coming back on something you were saying earlier, I mean to what extent do you just have to grow as a firm, because every year a certain percentage of your business drops off, it happens to everyone, so actually everybody’s got to have a growth mindset, even if they don’t want to grow their business overall?

PAUL YOUNG: Yes, I totally agree, you’ve got to have that growth mindset. Even if your protection isn’t, if it’s just to make sure you protect what you’ve got because of natural attrition. I think we talked about naturally the world will evolve. Inflation obviously is affecting margins and costs so getting that extra income and turnover and protecting your fees, and consumer duty hitting now and on our other episodes we’ve talked about getting that value across. I think if you can’t think of that growth mindset I think you’re going to be in trouble in the next couple of years.

PRESENTER: OK. And, John, let’s move on to the first of those definitions of growth, we were talking there about recruitment and advisers, so can you give us a bit of an overview there, what are some of the things to think about?

JOHN KERR: There’s a number of things to think about and a sort of major consideration right now is, you know, do you actually need to recruit, do you want to recruit? The marketplace right now is extremely competitive. So, if you’re a business owner or a hiring manager within a business, it’s really important that you have your recruitment process in place. That it’s robust. That you know exactly what you’re looking for, so you know the key objectives of the recruitment business moving forward. Recruitment is, whilst extremely challenging at this present time, once you’ve seeked and found that adviser into your business, you therefore need to work out how you’re going to establish that adviser in your practice. So recruitment is half the battle right now. And there is a bit of a battle for advice talent out there, but getting them on board through your robust recruitment process, establishing them probably very likely in the first six months that you embed them into the business. And I think crucially, whilst it’s very competitive out there, crucially you need to retain these advisers. Because you could spend three to six months finding them, a further six months establishing them and more importantly spend more time on retaining them.

PRESENTER: So it’s not just about recruitment, it’s about retention as well. Rob, let’s move on to that second type of growth you talked about, the growth of clients. Now I guess importantly presumably getting the right kind of client?

ROBERT POULTON: Well, it is. We find that going back to the numbers that we referred to before, whilst 50% of advisers are looking to grow their business, substantial minority 38% say that they’re not. But if you scratch the surface and talk to these people, it’s usually a capacity issue or perceived capacity issue. So if you reframe the question along the lines of, you know, if you did have the capacity, would you want to grow? The answer is almost universally yes. And it's exactly as you say it isn’t just growth in client numbers per se, it’s growth in the right type of clients, and that is to some extent linked to the amount of investable assets, but it’s also very important to advisers we find to get the right personality of client, maybe the right age profile, the right source of wealth, you know, are they interested in entrepreneurs, do they get on well with other professionals? So that’s almost universal that people do want more of the right type of clients if a way can be found that they have the capacity to deal with them.

PRESENTER: How important is making sure you’ve got a good spread of age of client, because you might be used to dealing with lots of clients in the 40s and 50s, but if you don’t have any in their 20s or 30s at some points you’re going to run out of…?

ROBERT POULTON: Well, indeed, and it can materially affect the value of your business, and the various metrics that fans use to value businesses and a lot of those these days include age. Well of course one of the productive ways of getting growth related to that and building sustainability into your business of course is to go for multigenerational. So a good question that advisers ask themselves is, of those clients who may be my age, 50s-60s, how many of them have children that we’re in touch with or even grandchildren, that seems to be the most profitable avenue to explore.

PRESENTER: And when you say the right type of client, Rob, how important is it to think in terms of across the age range as well? Because if you’re used to dealing with lots of people in their 40s and 50s, that’s great, but eventually unless you’ve got some people in their 20s and 30s on board, you’re going to run out of pipeline.

ROBERT POULTON: Yes, indeed, and that’s becoming increasingly important in terms of actual business valuations: a lot of the metrics that are used these days do pay attention to client age. So it really comes down to the intergenerational and multigenerational where people perhaps my age have got clients in their 50s and 60s, it’s how much and to what extent they’re engaged with the client, those clients’ children or even grandchildren, and that’s where you can build some sustainability into your business in the longer term.

PAUL YOUNG: Yes, just to add on to that, I think it’s interesting when we ask, I mean Rob touched on it earlier, even the sort of die in the wold adviser says I don’t want any more clients. He said would you like more of the right type of client, we can’t help but say oh go on then. But actually when you ask them what does that look like, naturally human behaviour tends to think of our richest, our biggest, our most valuable. And what we’ve learnt, especially with some of the work that Rob’s done with the firms is, you have like a normal distribution, you do need what’s the main profit, where’s the sweet spot? Yes you do need the youngsters. You do have these, you know, the rich whales as it were what I’m going to call them, but sometimes people start thinking about oh I only want the really rich or massive mortgages, actually that’s really hard, it’s your core business, but be able to actually span across all three areas, know what your core business is.

PRESENTER: OK. And we spoke on the last Akademia session we were on, Paul, about this issue about capacity and sustainability, so for those who haven’t seen it actually would you mind just recapping on that, because as an adviser I imagine, you know, to your point, yeah I’d love to take on more clients, but unless I can serve the ones I’ve got properly, I’m going to trash my business.

PAUL YOUNG: Yes, spot on, and actually it’s a good plug to go and watch the run more profitably episode. But John mentioned it earlier, you do need to think about the cost of delivery and you think about your core clients. The biggest, biggest, you do need to recruit. And that’s the first thing, do you actually need to recruit or do you need to recruit not advisers perhaps as power planners? But summary for the previous session, servicing I think done well is the absolute key. Moving from a glass ceiling of 100 to 150 clients, or households per year, we’ve seen firms move easily 400 to 500 because they got their servicing process. But the other challenge of course is that more time you’re doing looking after and delivering value, it robs your time to retain and do that whole I saw this and sort of you cuddling to your existing clients, and also thinking about your lead generation. Because often, as advisers, we tend to be focused on lead generation when the pipeline starts to dry up, not before it starts to dry up.

PRESENTER: And, John, just bringing in from the recruitment side, retention side on that, given some of the things that Paul and Rob have been saying, how does that then feed into how you think about the types of people you want to recruit for your business?

JOHN KERR: I come back to what I said earlier around, you know, it’s very competitive out there, it is a battle for advice talent. The why is extremely important, you know, why are you recruiting? And once you get that and you realise that it is a necessity for your business to enable it to grow, then you’ve got to work out well what is it you’re looking for: what type of adviser are you bringing in to the business? A number of considerations around that would be, you know, are you looking for an employee who’s maybe in a bank or a bank assurance type environment right now, soon to come into the business and employ them into your practice; are you looking for somebody who’s already self-employed who may be a registered individual in another practice, where you just feel that your model moving forward is the self-employed model for advisers. But I think it’s absolutely crucial that you understand exactly what you’re looking for and, you know, the marketplace is extremely competitive and thus you need to be very specific around your approach and how you’re going to attract that adviser into your business.

PRESENTER: And, Rob, just coming back to the third definition of growth there that you mentioned, which is the importance of profitability rather than just volume, can you unpack that for us?

ROBERT POULTON: Yes profitability is an interesting one. We find that people tend to - principles in business in particular tend to fall into two particular camps. There is those that perhaps more from the self-employed partnership mindset of profitability, but it’s really that it’s kind of like owning your own job, it’s what you pay yourself from, as opposed to perhaps the other mindset, the more businesslike, the more accounting mindset of profitability, what’s left when everybody’s paid themselves including the owners and directors, and therefore is available for reinvestment and indeed for some kind of financial reserve. And we see, of course we just saw from the COVID crisis how many businesses are really operating on very tight cashflows reserves, going to the wall in a matter of weeks sometimes. So it’s ironic isn’t it the sort of cashflow that an adviser would be very familiar with for their own clients, particularly those approaching retirement, maybe they need to do that for their own businesses and therefore see profitability as important in that way.

PAUL YOUNG: Yes, this other thing as well which is probably accelerated through COVID is this diversification piece. So, it’s this mentality, we’ve seen a change with, Mark, of either do it or refer it, and people actually getting on and doing that and referring, whereas it’s always been a oh it’s I don’t want to give my client away and oh how they’re going to deal with it, but actually just that whole hang on a second, how do I make sure I maximise all parts of the value chain, even if I’m not a specialist in mortgages or wealth etc. But we all know it’s never easy. Mortgages, when we’re very busy we tend to have, it’s not very good at referring protection because we’re too busy. Same for wealth etc. But having that mentality now about selling the concept of that I can help you comprehensively, but it may be I’ll bring a specialist in to deliver on that, we’ve seen a massive change in the last couple of years.

PRESENTER: OK thank you. Now we’ve talked about our three types of growth, giving a bit of a headline view, let’s drill down in to them in a little bit more detail. John, now you were saying growth doesn’t just mean recruitment in a in a firm, but one of the things was really interesting was saying how competitive the jobs market is at the moment. So why is that the case, what are some of the big sort of shifting tectonic plates going on in this market?

JOHN KERR: I think we’re all aware that there are roughly about 26-27,000 financial advisers in the UK marketplace right now. Compare that to 10-plus years ago that was 200,000-plus advisers, so is a shrinking marketplace. But more and more if you like private equity firms have entered the marketplace. At the moment there’s 32 private equity firms looking to build and grow distribution, and they are chucking tons of money at it. So a lot of money’s been floated around to attract quality financial advisers. My point here is that you’ve got to be really robust in what it is you’re looking for. I think, from my perspective, there are a number of ways you can go into the marketplace and recruit right now.

One would be yourself, do it yourself, but backed with a very well structured, well thought out, well planned recruitment process. The recruitment agencies, you know, the contingency-type agencies are a big player in the marketplace to feed advisers to those that are seeking to hire. The challenge you’ve got with recruitment agencies and indeed the advisers who sit on those databases are they are sort of looking around all the time. They’re not very successful perhaps in the current role and that’s always registered with databases. The third way of seeking good quality financial advisers, my preferred methodology of this, is that kind of executive search approach. You know your proposition inside and out and thus you know potentially where that person or that potential advisers sits, resides today in a successful environment where you need to go and basically do a proper headhunting approach.


PAUL YOUNG: Yes I totally agree, of course I would, but I think it’s also you’ve got to think of it from the adviser’s perspective is that it is a very attractive market for advisers, which also means it could be quite a challenging market for the owners of businesses. But all of those people got to answer that one question which is what’s the purpose? What’s the purpose of you being in business in the first place, what was it you did, what did you decide, what made you - some of these, I don’t know if John agrees, most of our firms got into business by accident because they were great advisers and we got too busy. And often when you’re an adviser looking to, am I going to sell, exit, and I know we’ll cover that in the fourth module, the exit module, Mark, but I’ve got to say what did you set up in business for in the first place and how are you getting towards achieving that, and that normally gives you a good flavour of whether you’re a good fit.

Because money can tempt people, rightly so, but, do you know what, most of the advisers we deal with, they still worry about their clients. What’s my client proposition, what are they going to get, what added value can I give them, it’s not all about what am I going to get, they’re very conscientious about that. So whether you are a business owner or whatever I think is actually having inward, you know, what are you in business for, what’s the idea, what’s the objective, what’s your purpose, and if you understand that more as an adviser or the business, obviously you get a closer fit, but funnily enough a lot of it comes out, it’s not all about the money, it’s about the client experience.

PRESENTER: Well, John, just a couple of follow-ups on that. Firstly I mean you were mentioning just on the money side there’s a lot around for the private equity. So how do you work out as an adviser firm whether you’re competitive financially, how do you compete with a big private equity firm, what are some of the other things that you potentially make attractive rather than just the money?

JOHN KERR: Great question. The reality is you need to be benchmarking in the marketplace. You need to be benchmarking against some of the competitors. If you’re a small business that might be more difficult to do, maybe then you need to sort of engage with a business consultancy, a recruitment agency, a headhunting firm just to sort of capture some of that information: what is happening out there, who’s offering what, where and when? And if you start benchmarking against your own proposition that will help you work out whether you are going to be able to compete financially, because that’s what the PD firms are trying to achieve here is just throw money at it. But actually in the second part of your question, I think, I believe it’s if you’re a small business, you know, it’s more than the money, it is what are you offering the adviser in terms of having them in the short, medium to long term in your practice.

Money plays a part but actually they might be young, ambitious, well driven advisers that know they’re going to be in the marketplace for the next 10, 15 years. And thus money yeah plays a part, but more importantly is the succession planning in place, equity participation, you know, that sort of medium to long-term scenario of recruitment rather than just throwing a load of money at somebody in terms of salary or if it’s a self-employed package, just a fantastic package, a fantastic potential package, that make it more sort of cultural. Make it a more sort of cultural fit into the business rather than just, you know, then the money that’s been operated out there right now.

PAUL YOUNG: And money does talk, of course, and John’s absolutely right. The smaller more entrepreneurial businesses are winning based on that family office feel, the environment, the culture, the purpose, come with us we’ll develop you. But when it comes to money, we’re also finding that some of the smaller firms are being far more entrepreneurial where they structure it. What I mean by that, as John mentioned there, perhaps they can’t compete with the upfront money. OK, because they haven’t got pots of money, as you said, Mark, but what they can do is they can think of right what can I do to help you have a share of value: is that a share equity team; is it profit share; is it shares in the business; is it capital; is it cashflow; is it retention bonuses; can we do something with retention; can we drive the right behaviour; can we give something around holidays - I love the firms who are giving far more about the holidays, the cycle to work schemes, the cultural bit. And that’s where they’re winning.

That’s where they’re fighting really well hand-to-hand combat is in those little, you know, you don’t have to commute to London, all those things, just. And sometimes of course because we do it every day, they don’t appreciate what they’ve got. You know, if you’re working in your office or your, you don’t sometimes value what you see every day.

PRESENTER: Well, that, yeah I mean I suppose that also brings the point of retention, which you mentioned earlier, so again, John, how do you stop your staff getting poached by private equity?

JOHN KERR: Well, I think a number of those reasons have been flushed out there. I think, you know, if they’re employees that you’re bringing into your business, you should be attracting with not just a salary but that equity participation. It should be a very good bonus structure aligned with the business, you know, what sort of clients are they getting access to, immediately onboarding to the business, is there a retirement plan, is there a succession plan, you know, all of these things are the medium to long-term objectives of a business owner and the adviser they bring into their business culturally needs to fit into that. I think they need to be in the business, living and breathing that business, living and breathing that brand within that kind of, you know, if it’s a small to medium-sized business, family-type business. I think all of those key things will help to retention. To be honest, it’s about having a retention toolkit. Recruitment as I said at the beginning is part of it. Retention crucially is an even bigger part of it. So having a retention toolkit to go through, to work through with the adviser of being on-boarded, employed or self-employed, will give you a better chance of retaining them from the competitiveness that’s out there.

PRESENTER: And what about things like restrictive covenants or sort of rules if you’re leaving the business what you can and can’t take with you, is that a sensible thing to do or is that a way of saying to your staff I don’t really trust you?

JOHN KERR: it’s about balance. It’s ensuring that if you’re going to put a restrictive comment in place, clearly you’re going to do that to protect you and your business. In terms of the adviser, yes you don’t want to sort of create, make them feel like they’re a hostage to the business because if you let them go or they decide to leave they can’t take clients with them. There are two parts to it. Firstly, if you’re giving clients to an adviser in your practice, then you should wrap a restrictive covenant around that, because they’re the clients that you’ve embedded over how ever many years of your business; if the adviser’s bringing clients to the table, that’s a negotiable thing. I would be sitting down as a principal as a business owner saying to myself, they’re self-generating, they’re doing that bit themselves, I’d like to think if I could balance it here, there will be no restrictive covenant around those particular clients, and should they want to leave, and I’d hate for them to leave but should they want to leave, they can take those clients with them. So it’s about balance.

PRESENTER: Thank you. And let’s move on to a bit of a deeper dive down into the clients, the second part of growth there, Rob. How do you go around attracting the right kind of clients?

ROBERT POULTON: Well there’s a number of ways. Probably the top three that we come across consistently of course is the old one about referrals being the best source of clients. But particularly where we found that people have been working on their testimonials, there is a way of really triggering those to actually get meaningful referrals. That’s probably one of the most fruitful ways that we found. Secondly I think is professional connections, developing those relationships in particular with accountants and solicitors. Although it takes a little time, requires some patience, anecdotally we find that those are more high quality referrals. There’s very few time wasters that come from accountants or solicitors because they’re to some extent pre-vetted. And then thirdly, take sort of dipping your toe into the water of digital marketing, where you really don’t need or probably want to become an expert, but there’s just a few key things that you can do in that arena that maybe we can talk about to capture a maybe slightly different audience and retain them. So there’s probably the top three that are consistent in our experience.

JOHN KERR: I think it’s really key with professional connections, you know, that there are more of them than there are financial advisers, but many financial advisers are seeing it as a fantastic line of supply potentially for their business in building their clients, key thing for me in my experience with professional connections is they get a bit frustrated and fed up with the way advisers approach them by asking can we get access to your clients, can we work as a joint venture, can we do something with you so we can access your client base? I would be taking a different tactic, which would be going into professional connections and saying I’d like to come and talk to you about how we can add value to your practice and maybe therefore have a bit of reciprocity and a relationship.

A quick example of that would be solicitors. So, many solicitors at firms out there offering the estate planning, wills and trusts. I think it’s fair to say that many solicitors don’t actually look after or talk to the executors of those wills on their roles and responsibilities, financial advisers do. And if you’re a financial adviser looking to create a relationship with a law firm, solicitor firm that does wills and trusts, then why don’t you go in there and explain to them what you could do to add value to those executors and thus create that sort of reciprocity relationship moving forward.

PRESENTER: Point taken on that one. And, Rob, just could you unpack for us a little more, what are your top tips for working with professional…?

ROBERT POULTON: Well, I think it’s interesting, looking at some research that was done just a couple of years ago 99% of solicitors and accountants reported that they had made referrals to financial advisers in the previous two years. So clearly it’s happening. And if an adviser isn’t getting referrals, they could potentially be missing out. But we also found that the key drivers have shifted a little. I think it was 87% of financial planners reported that they believe that so-called integrated advice produced better outcomes for clients. So what that means is simply joined-up coordinated advice where the solicitor, the accountant, the financial planner, perhaps the bank manager and other professionals are coordinating advice is seeking that better outcome for the client, rather than perhaps fee share for example, which is pretty much on the wane in particularly with solicitors. So it’s the integrated advice thing that’s driving the referral process in all directions really.

PAUL YOUNG: Well, absolutely, and of course Rob’s very modest, he won’t talk about the success he’s had, because one of the biggest things is not getting in front of them, because I think there’s nine times as more accountancy firms than there are advice firms, it’s actually managing that relationship. And one of the things I thought is a thing of beauty is making sure that you use the sort of calendar of key events for an accountant for example, knowing when their peaks and troughs are, and talking their language or, you know, when P60 returns etc. and then picking out the three months of the year where they have a relatively lower activity time, that’s going to be our matters arising meetings, and that’s when we’re going to have a little chat about let me talk to you what’s come across my desk, how could I help you with the world’s referrals, that type of stuff, zipping it and then watching it come near the way in the reciprocity-type of thing.

So I think there’s a, you’re right John, it’s people are almost tired of it, a differential approach is matters arising meetings booked in three times a year in a timescale where we have at least shown that we have a little bit of understanding of their stresses and calendar, and those have been the little tiny incremental pieces that have made a massive difference.

ROBERT POULTON: I think bringing those two points together really, it’s try and take a more strategic approach to these relationships, they do take time. Solicitors and accountants, it’s a generalisation but they tend to be risk averse, quite rightly, and therefore they are always concerned that any client that they introduce to you that the financial plan doesn’t in some way undermine their reputation. So it takes a little while. But all the things that financial advisers do for their clients, to take risk out of things, whether that’s independent custodianship of assets or the FSCS or the PI or the investment process, all of that is very meaningful to solicitors and accountants because of this, it’s all about reducing risk, and that really chimes with them.

So it’s important to also I think not to sort of have a blanket approach. Solicitors and accountants, yes they have maybe that in common, there’s a lot they don’t have in common, the sources of advice opportunity differ between them. John’s already mentioned one, another might be the, we see a lot at the moment with the solicitors for example in family law there’s a lot of so-called silver separators, people in their 50s and 60s, regrettably the divorce rate’s going up. They tend to have substantial pots of money. It throws off pension sharing orders, for example, which clearly leads to a need for financial advice. So it’s understanding where those touching points are and taking a focus of where can we improve the coordinated advice for clients rather than how many referrals can I get this week or next week. It’s that more strategic approach that seems to work.

PRESENTER: And is there anything else as an adviser you need to understand from solicitors, accountants, say almost from a regulational, qualifications, because if they are handing responsibility over to you, are there any sort of particular hoops they need to jump through to be able to do that?

ROBERT POULTON: Again, it differs. There are nuances between solicitors and accountants. But it’s slightly depressing that the whole issue of independence versus restricted still seems to persist in the minds of many solicitors, accountants and indeed financial planners. So, for example, solicitors have been able to refer to restrictive financial advisers since 2012. And accountants can refer to restrictive advisers with what’s called a designated professional body licence, DPB licence. But rather than that be a hurdle that actually adds specific value. Because it allows an accountant to comment on and endorse the advice given by the financial planner, which really makes it look much more like integrated advice and really adds value to that in the eyes of the client. And that’s to everybody’s benefit. So there are nuances but very much that restricted independent issue that used to sort of trip people up has long gone.

PRESENTER: OK. And there you also mentioned a little earlier sort of testimonials and referrals, how do you go about getting them, Paul, and then how do you go about making them useful?

PAUL YOUNG: Well, we’d love to say we’d planned it, Mark, but actually it was an unintended consequence. So the first one was we were fed up with those sort of on numerous lead generation sites, which of course won’t be mentioned, it’s almost like five star eBay, a great adviser.


PAUL YOUNG: So we use the behavioural science to work out well OK how do you talk to the right type of client? A client, you know, number one, the referral normally is a whole range of text and, I don’t know, is that someone like me? If I’m coming to retirement why do I want to know about a first time mortgage? So often just by putting the name and the type of demographic of the client can be a major sort of OK that connects to my social bias or social norms, how do you help people like me? So we started to engineer and test how to get really effective testimonials from clients, because most clients say yeah fine what do you want me to say? And can you write it for me? Well no hang on a minute let’s be genuine with it. So we put together some key questions that raise some of the behavioural biases, what were you nervous about, but the last part also was what type of client do you think would benefit most from our services, not have you got a name, what type of clients. And then we’ve got a PDF that the guys and ladies can actually get after the session, gives you some prompts on there. And what we’ve found, and this will hopefully get your attention is, 82%, 82% of requests for testimonials resulted in an unprompted referral. And we thought wow so what’s happening here? And first of all if you take the PDF, you’ll get a very good quality testimonial. That will happen if you follow the process that you get on your pack.

But what we found was that last question, by phoning up the client afterwards and thanking them saying Mark thanks ever so much for taking the time to answer those five questions, but I’m interested what made you, when I asked you what type of client would benefit most from our service, what was it that made you say that and shush, and then the clients explains. Because of course they’re thinking generically but they’re also thinking of key people and said look, so what do you think I could do to actually get more of those type of clients? And what we’ve tended to find that people have said well actually funny enough, I’ve got - and that would happen. And even if they didn’t, the last part was look, I’m going to send you a little templated email, could you just introduce the two of us at a time, so look without bias, how about having a chat to John, he’s a really nice chap, even if you got an adviser, I’m getting nothing for it. And that just went through the roof. So yeah I’d love to take the, we managed to find a way to use testimonials to get referrals, it was an unintended but a beautiful outcome as a back of the behavioural science analysis.

PRESENTER: OK. And so we will make sure that we’ve got that PDF below the player if you want to download that and have a look at that. The other bit that got mentioned was digital marketing. So we talked a lot about sort of face-to-face and real people content, but digital marketing sounds, it’s a completely different world, how do you make that work for you?

PAUL YOUNG: Well, again, and I think John will hopefully come in on this as well, but I think it’s like two parts. It’s passive and active, OK. And whether you’re recruiting for a new staff member or adviser or you’re recruiting for more of the right type of clients, it’s how does your passive footprint look is the first part. So, the passive footprint, by that I mean first of all do you even think about mobile first. A lot of firms still design on laptops and stuff for their sort of streetscape of their website. The second thing is what’s your profile like? LinkedIn sometimes has pictures of people when they had hair, for example, so that passive footprint. And I’ll get into the active bit in the minute, but the passive bit for me is some of the research which we actually go on for websites, is that actual hangtime on an average financial adviser’s website is one minute 53. That’s really long. John Lewis and Tesco would kill for that hangtime but they only go three areas. They only go three areas. Even though these websites have marvellous stuff in them, like calculators and process and all this stuff. They want to go to your homepage, they want to check you out and say do you look all right, you’re not a wrong ‘un, OK that’s fine, and then the third one is how do you help someone like me? And unfortunately we see so many websites with almost like loads of testimonials. No, I want to know how you help a late 40s, early 50s bloke who’s busy, help me.

Now some great firms do that by making sure they’ve even got into sectors now. I’m in banking, I’m in such-and-such, I’m in this life stage, let me show you how I help people like you and add real value. And that type of thing I think is, well it’s a game changer, but it’s a very passive piece, so it’s all about making sure that your financial, you know, your digital footprint behind the scenes is up to date, consistent and doing what it should do for us. So that’s the passive piece.

PRESENTER: And, Rob, what about the active piece?

ROBERT POULTON: Yes so one of the ways for example is on the active side is to have what we would call a message calendar, which is simply preparing your messages throughout the year but, again, as Paul was saying, linking them to the sort of salient relevant time of year. Now of course we’ve all been doing this for a long time with ISA season for example. But thinking a little bit more laterally, things around say in the summer holiday and so-called quieter period, when people are on holiday and maybe a message about well imagine if you’re on holiday all the time, think about when you’re retired, how are you going to cope with that, how’s that going to feel, how’s that going to feel emotionally and how are you going to handle that financially, so again it’s about sort of hitting the hot buttons throughout the year and people start to get to this, and none of it’s selling product or service, it’s just sending out a regular message at a given time of year. And you can segment it using your CRM system effectively. But also in terms of the medium, so some would be letters, some would be emails, some would be blogs or even social media posts. So if you think about not just the message but the medium, we found that to be extremely effective way to actively digitally market.

PRESENTER: John, one thing, you’ve been talking about the importance of thinking about what your values are as a business and how that affects who you would want to recruit and fit them in, how important is that as part of the digital marketing? Because if I look at some adviser websites, the adviser’s very keen on saying all being seen in home clothes and looking very relaxed, we hear a lot about them, their families, their hobbies. Others are pretty suit and tie and, you know, they’ve got a pretty strong vibe that money’s not funny and, you know, we’re here to be pretty serious because your wealth’s serious. What are your, have you got any thoughts or tips on how you recruit clients and how you want to come across?

JOHN KERR: I think it’s crucial now. Most, I say most, not everybody is in to the digital side of business but Paul touched on the passive communication, I’m a massive believer of passive communication, because you can’t pick up the phone physically, you can’t meet somebody every day, every week, every month, and if you’re creating passive communication, you know, you’re getting your kind of awareness out there, you’re creating your visibility, LinkedIn’s a key driver for that from the recruitment perspective, you’ve got the opportunity to create visibility across the marketplace. By adding value I might add, it's all about adding value, not sort of selling your proposition, selling the opportunity, adding value. I think from a recruitment perspective, it’s absolutely imperative that you are recruiting into the external marketplace. That your website is fresh, it’s updated, it’s modernised. That the opportunity that people are looking at or buying into is on there and it’s clearly visible and there’s a breakdown of what that opportunity is. It is a massive way forward now in terms of recruitment, through LinkedIn, through the sort of digital side, through social media, huge right now.

PAUL YOUNG: Yes so to build on that. I am still flabbergasted how many websites do not have a careers contact us. Because also think of behavioural, what to your clients does that say, does that say I’m fuddy-duddy, or is it no we’re growing, we’re expanding, which one would you naturally like to be more as a client of is I’m recruiting. So again at dress standard, I don’t know the right answer, I’m not an expert with it, Mark, but what I know is if you can attract more of the right type of clients, if your vibe is laid back, you’re going to attract more laid back. If your money isn’t funny vibe, is that, then that’s cool, but whatever it is, know your target market. But the purpose thing is really key for me. This making sure we understand our purpose is X, this is what we do, these are our values. Because the other thing we haven’t perhaps turned on too much already is the sort of graduates, the second careerists, and we know all the research says that they would rather [unclear 0:37:42] to a firm that says this is our purpose, this is our vision, this is where we’re going, come along with us, this is how we’ll grow and work with you together, that’s a massive attractor. And they check you out first on their phone. All demographics will check you out on mobile. Even my mum, she will have a look on her, you know, it’s a do this but they check you out that way.

So this, you know, how do you talk, have you got to contact us, we’re busy recruiting. And think about your target market. I don’t know whether Insta’s better than Facebook, but I know some firms, [unclear 0:38:15] for example, they do really good work with sports and musicians. So they’ve gone LinkedIn for the agents and Instagram, or Insta as the kids say, with for their target market. But it might be if you’re looking for old fuddy-duddies it might be LinkedIn for that but actually it’s Facebook because that’s more likely there. But I don’t know what the right or wrong, and there’s not, I’m not a social guru, but it comes back to this, what’s your target market, who do you want, be very specific and then act as if. And I think if we just spent a little bit of time doing that, we’d have a far better bang for our buck.

PRESENTER: Now we are almost out of time so want to start getting people’s final thoughts. Paul, I wanted to hook back on something you were saying earlier about sustainability. You’ve talked about the importance of growing sustainability. Can you just give us a little bit more detail around that and some key takeaways on how to think about it?

PAUL YOUNG: OK well knowing the last time I met you I thought you’d probably ask me this so I tried to think about it this time rather than just and actually it’s, I’ll give you a little story. My old manager said to me would you go on a course, it’s 30 minutes a month but it’s pretty much guaranteed to put an extra 10% on your top line, if I can get you on the course, would you go? But if you go you’re going to have to go there at least every month for a year. So yeah sign me up! He said what that is Paul is you sitting down and making sure you do your marketing and deliver on it. And that’s the sustainability thing. Often it’s carving out time to make sure that you invest time to retain your existing clients with an I saw this and thought of you, to think about who do I need to contact, this might be interesting for them, and then also think about what have I done about recruitment if I’m in a business scenario, and 30 minutes a month. And the fact he got my old manager got me hook, line and sinker, all he was asking me to do is protect your time to balance that sustainability thing. That wasn’t his words of course because it was back in the ‘90s, we didn’t know anything about this sort of stuff, but it’s like that balance of I’m too busy in the here and now, but who can’t really, who can’t give 30 minutes once a month to put their head down and think who do I need to say I saw this and thought of you, you’re really important, or I’ve got a message I think might be quite useful for you this time of year, make it more salient. And then think about how do I use that also because that tells the new recruiting adviser of, or power planner, this is the type of culture you’re going to come and be part of.

PRESENTER: Well, John, a final thought from you, if there’s one or two key takeaways, things you can do in your business right now, what would they be?

JOHN KERR: Well just be mindful that recruitment never stops. So the most important thing really here is ensure you know your proposition inside and out and what your effectively selling to the external marketplace to attract advisers to your business and crucially important is how you retain them. So my advice would be have a retention toolkit ready for a bespoke sort of approach to that adviser.

PRESENTER: Rob, a final thought from you.

ROBERT POULTON: Well, I think probably the most immediate quick win if you like would be the testimonials that Paul referred to in terms of using them as a kind of Trojan horse to get referrals. But I think in the longer term, the really strategic approach would be to the professional connections. It won’t happen quickly but with solicitors and accountants you can build some really high quality sustainable referral streams, so I would go with those two.

PRESENTER: We have to leave it there. Thank you for watching. Do stay with us. We’ve got some information coming yup in just a second on how you can use this for your structured learning and CPD. It just remains for me to thank our fantastic panellists, Robert Poulton, John Kerr and Paul Young. From all of us here, thank you for watching, goodbye for now.
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