How Financial Advisors Turn Old Prospects Into New Clients

When financial advisors think about modern-day prospecting, the knee-jerk reaction is to turn to advanced, high-tech techniques to reach new markets. Modern methods for finding clients include targeted ads built on big data, social media, SEO, and CAN-SPAM-compliant cold email prospecting (among others).

While all these new techniques work incredibly well when properly implemented, there are additional ways to apply these techniques to get even better results. One possible application is to reach out to your old contacts and use them as referral sources for new clients.

For the Virtual Financial Advisortm, communication with past contacts and clients should not be an afterthought. If the new markets are the business's new cluster of clients, then old contacts are the existing cluster of clients. This existing cluster is primed for the job. And the best part? All it takes is awareness and a little bit of tweaking of processes that you’re likely already doing.

Let’s begin with the advantages of modern techniques, then talk about the profile of the existing list of contacts, how needs change over time, and why past "Not now, sorry…" answers may actually change into a "Yes, now."

Advantages of Modern Techniques

With communication now easier, faster, and cheaper than ever before, there’s no doubt that developments in technology have improved our lives.

These advances have benefited the Virtual Financial Advisortm in more ways than one. The one-to-many model is now necessary to stay competitive. Moreover, modern platforms allow the business to tailor the same one-to-many approach into a campaign that feels like the traditional one-to-one old-school prospecting many have been accustomed to. This shift in leverage is critical, as even the smallest actions can have big results.

With the latest iterations in prospecting, it’s easier to book virtual meetings with clients, instantly answer questions, and reach anyone, anywhere, at any time.

But at the same time, expectations from prospects and clients have been elevated. So advisors who aren’t improving and adapting will actually find themselves falling behind. 

More than ever, algorithms on search engines and social media platforms make it easier to look for new prospects. Then again, why would you misuse modern techniques on people already in your circle?

Needs Change Over Time

John is an IT guy with an engineering background from a top school. Living alone in a small apartment, John saves a sizable chunk of the salary his company pays him. He is very much the stereotypical tech rising star.

A year passes, and John is now running his own firm. His startup qualifies for many of the tax-saving practices you specialize in. He and his wife are also expecting their first child.

Now, imagine you are a financial advisor working in the entrepreneur-with-families niche and you happen to meet John early in his career. While he may not have needed your services then, John surely fits your niche now.

The moral of the story is to keep people on your radar. Needs change over time.

Arrange for a VA to Track Follow-Ups

Follow-ups aren't limited to new prospects who promise to get in touch in a few days. No, the astute financial advisors know that follow-ups go beyond that. "Random messages" that are, in fact, planned and part of a drip campaign, or straightforward good wishes, can go a long way.

Yes, keeping track of prospects can be a challenge. This is one area a Virtual Assistant (VA) shines. A great VA is a versatile professional who can perform administrative tasks, basic marketing duties, and operational jobs like prospecting follow-ups — more on pairing a VA with a CRM system in a bit. Also, modern platforms make hiring a great VA at a fraction of the cost possible.

Many people appreciate a simple birthday greeting. While others borderline-expect holiday greetings. As a Virtual Financial Advisortm who stays informed, these are mandatory undertakings.

Personalized Alerts with Systems

So, what is the magical formula for tracking follow-ups? The answer is really a combination of two elements: A VA using a Customer Relationship Management (CRM) system. 

For the most part, a Virtual Assistant is the financial advisor's extension and they do more than just track follow-ups — so, having one makes sense, regardless of what you do. Conversely, a CRM is optimized to track customers. Use them in combination for the best results.

CRM-Based Reward Systems

CRMs can also be used to enhance old school prospecting techniques like rewarding existing clients for their continued support, showing appreciation to clients who send new referrals, and other customer retention methods of the past.

But before that, let us shed light on the importance of customer retention over customer acquisition.

Customer Retention

Years of research show that client retention is far cheaper than client acquisition. Yet the widespread notion is to acquire more and more customers. Why is that?

One possible reason is the natural association between growth and success. Business school reinforces this mindset. And an excellent way to grow is to increase market share — i.e., acquire more customers.

But the fact is that customer retention initiatives should precede acquisition activities. Besides, because retention is less expensive, there’s usually plenty of budget left for customer acquisition after the fact.

Existing Clients

An effective CRM shows the business its clients' profiles. One customary practice that works well with this CRM feature is rewarding clients for their loyalty.

Simple tokens work. It’s the unexpected nature of your gift that makes it special.

For instance, the business could support the local community by purchasing large orders of taffy at the local candy shop.

Show Appreciation to Customers Who Send New Business

Similarly, another traditional method that works well with modern tracking methods is the gifting of rewards to existing customers who send over new referrals. This hits two birds with one stone: Not only do you show care for your existing clients by rewarding them, but you do so while acquiring new clients in the process.

Saying Hello in a Digital World

So far, we have talked about entity-specific tools, like CRMs and VAs, to connect with past connections and associates. Of course, we would be remiss not to mention the ubiquity of social media, the growing acceptance of digital platforms like Zoom, and the impending Web 3.0.

The global pandemic that began in 2020 surely played a part. It accelerated the wide acceptance of doing business in the digital space. Even hard nosed old school players were left with no choice but to adapt to virtual meetings.

Social Media

LinkedIn is by far the most effective social networking platform for getting in touch with old and new clients. Optimized profiles absolutely matter. Your LinkedIn profile is the first thing people see, so your page must effectively demonstrate what you bring to the table.

Although LinkedIn dominates the professional scene, every social media platform is fair game when it comes to past contacts and old school prospecting techniques. After all, the advisor has history with them.

Fair warning, though. Some people dislike this approach and can smell a commission-hungry financial advisor a mile away. Make sure to be genuine when taking this approach.

Virtual Meetings

There was a time when virtual meetings were frowned upon. In fact, not so long ago, the digital way was tantamount to a ‘lack of commitment’ to the client, or downright laziness. But COVID lockdowns forced everyone to accept this new reality.

Today, quick chats are easier than ever. Zoom is the prevalent choice. But other companies are catching up. Apple now makes Facetime calls shareable to Android or other devices. Microsoft currently ships the Teams app on all Windows 11 systems.

Appreciate that these systems are more than just tools for untapped markets. So, drop a line and get in touch with old contacts. Contemporary apps remove all excuses not to.

Web 3.0 and the Metaverse

If history is a reliable gauge, then expect the sustained exponential growth of technology. Web 3.0 is the Internet's new form, and it is where the emphasis shifts to virtual interactions. (Who knows, maybe that is where coffee chats of the future will be, with avatars meeting avatars? Sounds crazy, I know…but tech moves fast.)

The Metaverse is more than just Facebook's rebranding. It is the collection of systems set in virtual reality. Whether or not people adopt the Metaverse sooner or later is unknown. Nevertheless, this evolution is sure to affect how advisors communicate with old contacts.

When Old Meets New

Sometimes, the best opportunities are right under our noses. This holds true with prospecting. A prospect’s needs change over time and it’s up to us, as advisors, to be in the right place at the right time with the right message. While modern techniques help financial advisors find new personalities to serve, the very same technologies can reignite old relationships and turn them into new commissions, fees, and AUM.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.