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Turning clients away - is it good for business?

Business Development for Financial Advisers and Paraplanners

30 Oct 2019

Turning clients away - is it good for business?

Towards the end of last year, I was privileged to be invited along to a focus group for a financial planning client of mine. 

A group of the firm’s clients had been invited along to a half-day event where an external marketing agency explored with the group several important questions, including: 

*Why they appointed an adviser in the first place

*Why they chose this firm rather than another one

*What they thought of the service and how it could be improved

*The client’s attitude to the quality of the communications from the firm 

As one of the clients remarked during the morning, this was a brave thing to do. To open yourself up to hearing what people really think of you and your business.

This firm, through dedication, hard work and a willingness to continually improve is one of the fastest growing practices I have come across. 

The feedback from the clients was overwhelmingly positive and I ended up taking several pages of notes. 

Two of the things I found particularly interesting for anyone who wants to grow a profitable practice working only with ideal clients are: 

1. The initial (and ongoing) conversations with each client were not just about money and this was a significant factor in the clients deciding to work with this firm. 

First and foremost, there is a genuine interest in how the clients want to live their lives and one of the clients said about the adviser: 

'He unlocked answers I had never even thought about before and this was very thought-provoking'. 

Several of the clients had decided not to work with other firms or had moved away from another firm because the adviser only focused on products, investments and financial matters. 

The overwhelming feedback from the clients was that they wanted to be treated as individuals rather than the next transaction.

But it was also a two-way street because...

2. The practice turned away more people than they took on (only 20% of initial inquiries turned into paying clients).

If a potential client did not fit the 'ideal client' profile, then the adviser was up-front about it (with kindness and respect, of course). 

The paradox 

If you want to grow your business, then turning away potential clients may not initially seem to make sense. 

In fact, many firms are focused only on the short-term numbers rather than the bigger picture, so they take on pretty much anyone.

This often leads to problems further down the line. For example, many firms accumulate far too many unprofitable clients and find an increasing amount of time is taken up with them.  

The foundation for working only with 'ideal clients' is a state of mind. 

It is having the inner confidence (even when it gets uncomfortable) to be true to the vision of what you want to create.  

This comes from knowing that you do not need any client or piece of business to be ok. 

Did you enjoy this article? You can download a FREE copy of my 'What every adviser ought to know about Client Engagement!' report and free exclusive content by clicking here.

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