March 17, 2009
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I am convinced we are in the midst of a significant shift in the way we attract new clients – something that will lead to the death of mass prospecting as we’ve historically known it.
Recent conversations with investors and advisors confirm my belief.
This has little to do with the market decline of 2008 – and everything to do with a much more informed and skeptical consumer than in the past.
The last twenty years has seen a steady and precipitous decline in the Other Articles by Dan Richards
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Twelve Pieces of Good News in the GloomTalking to Prospects about Last Year’s Performance response rates to all the traditional forms of mass prospecting. As a result, a dramatic – and in my view permanent – shift is occurring in what
it takes to attract new clients going forward. The essence of this change is that the traditional divide between communication to clients and communication to prospects will disappear – and advisors will have to start treating prospects like clients from the moment they start talking to them.
The past
As recently as the sixties, the 10-3-1 rule still prevailed in the insurance industry – if you spoke to 10 prospects, you got three appointments and had a high likelihood of making at least one sale.
In the late eighties, mail drops offering free research reports garnered return rates of 10% to 15%. If you mailed out 500 letters offering a research report, you could expect 50 to 75 responses.
In the mid nineties, hotel rooms across were packed with prospects attracted by newspaper ads offering free seminars featuring media celebrities. Many advisors built their businesses based on the turnout to those seminars.
In the words of cult novelist S.E. Hinton, “that was then … this is now.”Display article as PDF for printing.
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