Building Profitable Client Relationships

Financial services firms are entrusted with what most of us consider our most valuable possession, the one we are most concerned with, agonize over and have the strongest emotional attachment to – our financial security. The highly-personalized relationship between service provider and client in the financial services industry is critically important to build but can be easily lost. In an era when financial services clients have come to expect the same responsive service when working with a fund manager, private banker or even shopping for a mortgage as they would receive buying the latest best seller on Amazon.com, firms are challenged to meet new client acquisition targets while exceeding the expectations of current clients. To outstrip the competition, firms need to understand clients and potential clients better than competing firms, use this knowledge to create a consistent client experience that is beyond reproach and ultimately secure a higher proportion of each individual client’s assets available for management.

For this reason, asset managers, mortgage brokers, investment bankers, private equity firms and venture capitalists alike have embraced client relationship management technology (CRM) like no other industry – shrewdly selecting systems that empower their finance professionals to capture and access valuable information about each unique client. Winning financial services firms are those that learn from their clients, and understand their preferences, tolerances and motivations for investing. As a complete client relationship management system, Maximizer Enterprise is designed to help firms personalize the investing experience - tracking not simply the products held by a client but also their complete history with the firm, relationships to other investors or brokers, products held in competing organizations and even favorite sports teams and life events like birthdays and anniversaries.

Discover Your Client: Build a 360 Degree Client Profile

The critical ingredient in creating a high-quality, personalized client experience is client profile information. More than that, it is the ability to quickly capture client information across all touch points in the firm and provide the client with a positive experience so that no matter who they speak with at the firm, that person will know them and will speak intelligently with them about their business with the firm.

At Diablo Funding Group, California’s largest independent mortgage broker, ensuring that mortgage brokers have 100% up-to-date client information meant close integration between the Maximizer Enterprise client relationship management system and the firm’s Calyx lending system. “With the integrated system our mortgage representatives can personalize the real-estate financing experience to an extent we simply couldn’t dream of achieving before. Using the system, we can attract new prospects, quickly capture preference information including financial goals, relationships with other customers and details of competing institutions – and share that history with the entire team working to help that particular client,” said Jonathan Bellusa, Managing Partner, Diablo Funding Group.

GrowthWorks, managers of Western Canada’s largest venture capital fund also finds success in the close integration between its Maximizer Enterprise client relationship system and the firm’s transactional sales system. Before the deployment of the integrated system, it was possible for a broker to make a sale on a fund without the knowledge of GrowthWork’s fund managers or marketing team – making it difficult to track the performance of each fund and determine the effectiveness of the firm’s marketing efforts. "Our CRM system now provides a holistic view of our investment advisors," said Murray Munro, Senior Vice-President, National Sales & Marketing, GrowthWorks. "With the integration into our transaction database, we’ve streamlined processes and saved everyone time by reducing redundant data entry efforts. It also helps us utilize customer and sales information to conduct targeted marketing campaigns to more effectively service the advisors who sell the funds we manage."

Using Profile Information to Deliver a Personalized Investing Experience

"Financial services is an incredibly complex and competitive industry where expectations are high and customer loyalty can be hard to retain if you're not giving customers what they want,” said Chris Carter, Associate Director & Branch Manager of ScotiaMcLeod, a full service investment firm and division of $280 billion ScotiaBank. “It's similar to other selling situations in which your level of professionalism is dictated by the quality of information you have on hand.”

The firm uses its Maximizer Enterprise client relationship management system to automate most of their everyday tasks including scheduling outbound calls, recording contacts, and managing literature fulfillment. Advisors use Maximizer Enterprise to manage and route leads, automate email campaigns, capture leads off the Web site, and segment and track each interaction the client has with the firm.
The system makes capturing and accessing client information easy. With a simple right click, advisors create a “User Defined Field” or folder in the system for entering a specific customer criteria while meeting with a client or speaking with them over the phone. Important profitability indicators like total assets under management, risk tolerances, specific industry sector preferences and life events like marriages and birthdays can then be quickly documented in the system and instantly become searchable. Then, when a new issue is available, advisors can quickly segment from their total client base which are the most likely to purchase and make their first calls to those clients – reaching out to less likely candidates later in the day. With the system in place, clients receive highly-personalized service, advice and literature while the firm maximizes its opportunities for sales to each client.

According to Carter, “When you have good, up-to-date information that your front-line team can access quickly, you have a better chance of anticipating your customers' needs. Using technology to improve the overall customer experience gives the client a good indication of how organized your company is and shows the competency of the individuals and management team at your firm. When we can anticipate the needs of our customers and make informed suggestions to help them meet their financial goals, not only are they more likely to stay with us, they are also likely to refer more business to us.”

The story is similar at Diablo Funding Group. With all client information captured and instantly retrievable from one unified application, sales representatives are able to pull up each client’s history with the firm; determine which marketing efforts they found attractive, which mortgage options they are interested in, mortgage quotes they have outstanding – even review Outlook email correspondence and attachments right within the CRM system. With this information at their fingertips, brokers are in a much better position to cross sell and upsell effectively based on real client requirements – giving the client a very personalized experience while maximizing their value to the firm.

The Imperative: Maximizing Broker Effectiveness

A key challenge for financial services firms seeking to develop a holistic view of each individual client is the fact that many firms rely on brokers or other third parties to take their products to market. In many cases, the broker is the customer who is actively serviced by the firm. The ability to provide these brokers with a window into the firm’s larger relationship with each client – and a mechanism for keeping track of their own interactions with clients is a key determinant of both broker and client satisfaction. For Steele Capital Management a modest $600 million private banker and 401K product vendor, supporting the firm’s broker network with leading edge client relationship management technology is part of the firm’s strategy for competitive differentiation against larger institutions.

"Attracting and retaining top-producing independent salespeople is absolutely critical to our business model and that means offering them the most convenient and profitable means of interacting with our firm," says Kevin Timmerman, President, Steele Capital Management. "We understood that we needed to give them the same tools we were using in-house so they could be more productive, but also so we could better assess which were selling and which weren’t"

Steele Capital Management’s network of independent salespeople typically specialize in something other than investment management and retirement savings planning – preferring to offer their own private book of clients the specialized services of Steele Capital Management. Before the CRM system was installed, these salespeople recorded client information in a wide variety of different ways. Some preferred Excel spreadsheets; others had their own contact management system, while many continued to use paper files for keeping track of their clients and their business with Steele Capital Management. Today, those brokers have secure, password-protected access to an online portal which is a direct interface into the Maximizer Enterprise system.

GrowthWorks also relies heavily on a network of independent salespeople to sell units in the funds it operates. Using the Maximizer Enterprise client relationship management system as a window into the firm’s transaction system, the Sales Operations Team can quickly run their own reports to see sales figures for each investment advisor. This makes assessment of each independent broker’s performance much more accurate and allows the firm to better differentiate between high performers and those that are not contributing to the firm’s profitability. With this level of integration, the marketing department is also able to better understand which marketing efforts are most effective in terms of supporting the sales of the broker network.

Results: Growth & Profitability

Firms like ScotiaMcLeod, Diablo Funding Group, GrowthWorks and Steele Capital Management share a common commitment to delivering a client experience that differentiates the firms from their competitors – and that commitment is being rewarded. At Steele Capital Management for example, since the deployment of a comprehensive client relationship management system, the firm has:

• Managed a new client acquisition rate averaging more than 30% annually;
• Retained 99% of its clients;
• Drastically reduced errors in administrative processes;
• Grown assets under management by an average of more than 30% per year;
• Added and retained hundreds of high-net-worth investment management clients;
• Grown its independent salesperson network from 15 to 50;

By putting systems in place for the effective capture and smart use of client preferences, taking advantage of close integration between corporate systems and offering those same tools to third parties such as brokers, these firms are in a much better position to secure the maximum proportion of each client’s assets available for management. Importantly, all of these firms have established standardized processes for interacting with clients and independent salespeople that ensure a consistent, positive experience for each individual client. Like compound interest, the potential profitability benefits of retaining nearly 100 percent of your clients are enormous.