By Joshua Dietch
I speak with a lot of advisors, most of whom, I believe, are good at what they do. I look at their credentials and I am generally impressed. I look at their books of business and I assume that they are successful. Assuming all of this is true, how would I decide to hire one of them over another? What differentiates one advisor from another?
For the past couple of years Chatham Partners has managed a value added program sponsored by Franklin Templeton that helps advisors learn the true reasons why they are hired — or not. Advisors who have participated in the program have done so by supplying contact information for recent prospects to Chatham, who then conducts confidential, in-depth interviews to determine the reasons for hiring or not hiring the advisor.
So how do successful advisors do it? Simply put, plan sponsors, by and large, choose advisors who successfully differentiate their practices. While that might sound obvious, the path to it is not. Recently I attended a dinner with a group of elite advisors. By coincidence, two advisors were at my table who recently competed for the same plan. By further coincidence, Chatham had interviewed the sponsor on behalf of the losing advisor. In this case the winning advisor differentiated himself by demonstrating his expertise and experience with sponsors just like the prospect. This is but one insight of many that this type of research can reveal.
Over the past couple of years the research Franklin Templeton has sponsored has identified six actions advisors can take to differentiate their practices and improve their chances of closing new business:
1. Successful advisors view new business development as a process. Do not rely on luck. Having a disciplined and repeatable process is critical to bringing a prospect from the initial stage of interest to signing them as a client.
2. Referrals are the strongest endorsement. Prospects look for referrals. Build a strong network and turn clients into advocates for your services.
3. Position yourself as an expert. Plan sponsors most often seek out advisors for help overcoming challenges and addressing specific plan needs. Experience and expertise are critical differentiators. Accordingly, advisors should develop proof points — such as case studies and testimonials — that demonstrate how advisors’ services have helped others.
4. Personal fit is the most influential attribute in determining the success or failure of a bid. Foster close connections by listening carefully to plan sponsors and providing solutions that address their concerns.
5. Clearly describe what prospects can expect to experience as a client. Give prospects a road map of how they will benefit from your services over the course of the client relationship. Outline what milestones will be achieved and how success will be measured.
6. Don’t minimize the importance of the finals presentation. It is the concluding event to the sales process and affirms an advisor has the necessary skills the client needs.
You can learn more about how you can differentiate your practice at our workshop session, “Standing Out from the Crowd – How to Effectively Differentiate Your Message from Your Competition,” at the 2014 NAPA 401(k) Summit on Tuesday, March 25, 2014. I’ll be joined by Mike Sanders and Jim Hageney, two distinguished advisors from Cammack LaRhette and Centurion Group, respectively, and Lisa Kueng from INVESCO’s Consulting Group.
If you can’t make it to New Orleans and would like to learn more about participating in the Franklin Templeton research, you can do so by contacting your Franklin Templeton DCIO Specialist at (800) 530-2432.
Joshua Dietch is the Managing Director of Chatham Partners, a market research and consulting firm based in Waltham, MA.
