{"id":55881,"date":"2021-05-21T09:58:42","date_gmt":"2021-05-20T23:58:42","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=55881"},"modified":"2024-10-30T08:44:49","modified_gmt":"2024-10-29T22:44:49","slug":"after-21-years-the-client","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2021\/05\/21\/after-21-years-the-client\/","title":{"rendered":"After 21 Years – The Client"},"content":{"rendered":"\n
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In the second of this three-part series, the team at Business Health outline six key observations they have experienced over the last 21 years when it comes to client attributes for advice practices, and they share some great tips – from your peers- for any adviser seeking to optimise the value of their client relationships while in turn building the value of their business\u2026<\/h3>\n<\/div>\n<\/div>\n

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\"\"<\/a>Six Observations<\/strong><\/p>\n

Observation 1<\/span><\/p>\n

The standout mover has undoubtedly been the dramatic reduction in client numbers over the years. Practices today are serving fewer Australians. How ironic – this reduction is occurring at a time of the greatest wealth transfer in our history, as aging parents (the majority of today\u2019s financial advice clients) look to navigate the vagaries of retirement and pass on their wealth to their children in the most effective way. If ever experienced, professional advice was needed \u2013 isn\u2019t it now?<\/p>\n

Observation 2<\/span><\/p>\n

Given the huge reduction in client numbers over the years, it\u2019s encouraging to note the commensurate increase in \u2018revenue per client\u2019. Practices have been largely successful in removing transactionally based clients (traditionally funded through grandfathered revenue) without any major \u2018hit\u2019 to their bottom line. In doing so, they\u2019ve proven the 80:20 rule.<\/p>\n

Observation 3<\/span><\/p>\n

\u2018Business Relationship\u2019 has been rated most highly in every year, with the % of clients expressing their intention to maintain an ongoing relationship with their adviser, never dropping below an impressive 90%. When matched with the equally impressive % of clients willing to refer their own adviser, it\u2019s clear to us that \u2019relationship\u2019 is one of your most valuable assets.<\/p>\n

Observation 4<\/span><\/p>\n

Clients have continually reported that they don\u2019t necessarily \u2018enjoy\u2019 their adviser\u2019s review\/progress to plan process. The fact that it continues to be the lowest rated of our CATScan indicators, is a source of great frustration for us as we believe that the review provides the opportunity for the adviser to demonstrate their value (for the fees being paid). It is certainly the adviser\u2019s \u2018moment of truth\u2019.<\/p>\n

Observation 5<\/span><\/p>\n

At no point in our 20 year history has the level of practices seeking client feedback exceeded one in three. This has meant that somewhere between 60% – 70% of Australian practices have been operating without an objective understanding of how satisfied, or not, their clients were. While this has always been a somewhat misguided approach, it has become even more so, given the somewhat parlous image of our industry this century \u2013 GFC, Royal Commission, corporate failures and so on, ring a bell?<\/p>\n

Observation 6<\/span><\/p>\n

The accumulator demographic which has comprised the major portion of the client base for most practices has obviously aged and has seemingly not been supplemented by a younger base. Clients aged 60+ now make up 55% of the clientele \u2013 significantly higher than the 38% stat of 2001. They have stayed and they have greyed. And they don\u2019t have the same needs as they once did.<\/p>\n

Tips<\/strong><\/p>\n