Client engagement – a top priority

01 April 2014 Johann Maree, Australian Correspondent

Within my first month of speaking to advisers and product providers in Australia, it appears that advisers are focussing a lot of their energy on client engagement. The reason for this is that it is the key to better client retention, more referrals and increased profitability that, when combined, allow advisers to maximize the value of their client relationships.

How can financial advisers boost their clients’ level of engagement? Top advisers use an approach consisting of measuring, managing and growing relationships.While implementing this strategy will not happen overnight, it would seem that an adviser’s efforts can improve their clients’ levels of satisfaction and strengthen the client/adviser relationship.

Measuring relationships

Advisers should use a formal process to measure the quality of their client relationships and help identify areas for improvement. To achieve this, advisers should conduct a client satisfaction survey every 18 to 24 months.

The results should provide insights into six areas:

- Satisfaction: the aim is to gain a better understanding of their client satisfaction with their overall performance.
- Risk: by studying satisfaction levels, advisers will be able to identify which clients are at risk of leaving.
- Drivers: advisers can uncover the service drivers their clients value the most, as well as the perceived value of their communication.
- Expectations: results will reveal client expectations for service delivery, from the number of reviews to relationships developed with other team members.
- Needs: by assessing service gaps, advisers can uncover additional client needs.
- Opportunities: identify clients who may provide referrals or help advisers expand their network.

There is some merit in advisers testing their survey with several particularly trusted clients and incorporating their feedback. When distributing the survey, it is important to include a note explaining its objectives, and outline how the clients will benefit. After the survey and analysis is complete, advisers should follow up, highlighting positive outcomes and changes that they might be making as a result of the data obtained from the findings.

Managing relationships

Advisers should use these insights to enhance service delivery. For example, they may find that clients place little value on client appreciation events, but request more communication regarding their investment portfolio and progress made on their retirement plans.

To be most effective, clients must be segmented based on their needs. Then, using information about those needs, wants and expectations drawn from results, the service standard most appropriate for each segment must be defined.

To be most effective, clients must be segmented based on their needs. Then, using information about those needs, wants and expectations drawn from results, the service standard most appropriate for each segment must be defined. Thereafter, client profitability needs to be assessed, based on the service offering advisers have defined.

Now determine costs and the number of clients that can be managed. The service model may need to be refined at this point. After that, advisers must communicate their plan to clients, regularly reviewing their satisfaction with the relationship.

Growing relationships

Ultimately, the most effective way to build engagement is through face-to-face meetings, especially during portfolio reviews. At that time, advisers can make the best use of information gathered during the survey process and uncover additional opportunities by discussing results with clients.

In some cases, advisers may need to explore the reasons for dissatisfaction and develop an action plan for improvement. In other cases, advisers focus on the areas clients perceive as being the most valuable. In this way, advisers are not only able to learn more about their clients, but also use the discussion to reinforce positive feelings.

Looking for improvement

There is no doubt that the onerous compliance requirements, the growing urgency for succession planning and the current and more time consuming operating environment for providing financial advice to clients is encouraging advisers in Australia to look at ways in which to make their client engagement more efficient from a business point of view, and more meaningful for the client.


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