What you say and how you say it matters
According to a 2019 survey[1] of 650 financial planning clients, most reported infrequent contact from their advisor. The survey also revealed that 85% of clients said their advisors’ communication style and frequency mattered when deciding whether to retain their services or refer them to family and friends. Since communication is so important, we developed this practical guide to help you create an actionable and effective communication strategy.
Here are five tips for an effective client communication strategy:
1. Set Communication Goals
Just as you work with clients to set financial goals, it is helpful to set communication goals to measure how well your plan is working and when to adjust. Some examples include:
- Get five likes or shares on each article you share on LinkedIn
- Grow podcast following by 10% in three months
- Build an opt-in email list of 250 prospective clients
2. Tier Clients by Profit Potential
As an advisor, you only have so many hours in your day. It’s crucial to develop a tiering system based on the potential profit clients can bring to your practice to create efficiency. Each year assess these tiers and identify any necessary adjustments.
| Tier | Client Profile | Communication Strategy |
| I | These are your most valuable clients. They have the most assets with you, are in your target market, and can refer you to more clients like them. | > Provide the highest service level, communicating at least two times per month.
>Invite to exclusive client appreciation events. |
| II | While in your target market, these clients don’t have as much to invest as your Tier I clients. However, they can be a valuable referral source if serviced well. | > Communicate at least once a month with personalized, valuable content. |
| III | These clients have given you some, but not all, of their assets to manage. By expanding your relationship to its full potential, they can help you grow your business. | > Communicate two times per month, especially if you think other advisors are reaching out. |
| IV | These clients typically have a low amount of assets and are not ideal for your business. | > Offer minimum service and communication levels. |
3. Gather Necessary Information
To personalize client communications, track information about your clients. As you prepare for client meetings, be sure to reference this information to personalize the conversations. Using a CRM system, or even a spreadsheet, gather the following data in your meetings and regular interactions with a client:
- Immediate family: names/birthdays/anniversaries/life milestones, etc. (include pets)
- Hobbies and interests of client and spouse/partner
- Major concerns – life and/or financial
You may also find this information from following their social media profiles and posts.
4. Identify Communication Preferences
Not every client is going to want a phone call every week. Some prefer a text message and others prefer email. Add a communication preference question to your client intake form, make it part of your annual review for existing clients and log this information in your CRM.
This information from the above-mentioned survey offers additional insight:
- 75% of clients said they would like to receive updates that are personalized to them (including interesting stats, visuals, and/or articles relevant to portfolio holdings)
- 66% of respondents are interested in receiving market-related news, saving and planning tips, or financial “How To” emails
- 44% are open to receiving phone calls
- 31% would opt-in to text message updates
5. Determine What to Communicate
Although it may seem obvious, your communication strategy will be more effective if it revolves around a client’s needs, interests, and concerns. To make your process more manageable, try to create a plan for each client ranking discussed above. Below is a sample communications calendar – the frequency of communication should be adjusted to reflect each client’s level.
| July | August | September | |
| Week 1 | Article: Social Security | Article: Prospect Theory | Email: Quarterly Newsletter |
| Week 2 | Email: Checking up on annual financial goals | Retirement Article: Little Changes for Big Plans | Article: Investor Protection List |
| Week 3 | Direct Mail: Independence Day postcard | Email: Share a commentary on current market events | Email: Share an activity for parents to teach kids about budgeting |
| Week 4 | Monthly Portfolio Update | Monthly Portfolio Update | Monthly Portfolio Update |
Planning a quarterly calendar for each client level allows you to manage your time better and execute these communications consistently. Once you complete your first quarter of communications, measure your results against the goals you set, ask clients for feedback, and reassess. Remember to build in some room for flexibility to adapt to significant industry or world changes. Some ideas for other content you can send your clients to include:
- Active vs. Passive investing article
- Tax management strategies
- Retirement topics: How to know if you have enough
- Alternative Investments 101
- Your favorite podcasts, with a few sentences about why you recommend them
- Your thoughts on cryptocurrencies and their place in investing
- Blended families: What to consider in estate planning and investing
And, of course, if you’re looking for additional client-friendly articles and content to help fill your communication calendar, your Frontier Asset Management team is happy to help.
Download the Communication Guide
[1] Ycharts Survey, December 2019, How can Advisors Better Communicate with Clients? https://go.ycharts.com/hubfs/YCharts_Client_Communications_Survey.pdf