Client Attraction Action

A Financial Advisor’s Most Important Number

March 18th, 2009

This blog is by Bob Hanson

A Financial Advisor’s Most Important Number for the
2009 Marketing Plan and Budget

If I asked you to invest a few hours of your time
this year and offered to pay you $5,000 a year
starting next year for 7 years, would you take it?

Most financial advisors would. And that is the
power of the Lifetime Value of the Client.
Many advisors, though, focus on the marketing
investment to acquire a client this year, and
look for the “quick fix” to their income this year,
rather than getting “rich” a little slower.

After working with and interviewing hundreds of
financial advisors, one of the things that separates
the top producers from those who struggle year after
year is knowing your clients’ lifetime value (and
Lifetime Referral Value, (that is how many referrals
you get per client).

If you know, for example, that the average client pays
you $5,000 in fees, stays with you 7 years, and
refers you one other similar client, then each new
client produces $70,000 in fees over time.

So, I would submit, the top producers focus on this
number, above all, when looking at a marketing budget or
client acquisition investment, not the fees for 2009.

Entry Filed under: Direct Marketing