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If there is one thing I have discovered in interviewing 1,000+ advisors for nearly 20 years, it is this:
Most advisors and practices get defensive during bear markets and recessions and look inward to protect what they have. They wait for the external climate to change to return to offense and growth.
As one RIA executive told me, “We know the playbook in a downturn, we’ve been here before. We increase the frequency of our client newsletters to address an economy and stock market volatility and reach out to clients individually with more emails and calls.”
Don’t fall into this common trap.
Instead, by resisting the temptation to circle the wagons, you may:
- Tap into frustrations of potential clients unhappy with their current advisor;
- Gain market share with your target audiences while the competition is distracted;
- Get more referrals and business from existing clients and prospects; and
- Strengthen the foundation of your practice for the next phase of growth.
Here are five easy, overlooked tactics to recession-proof your practice for more income, fewer headaches, and a more stable and thriving practice over the long term.
1. Strategically refresh your messaging with today’s markets and economy in mind
Many advisors stick with the same marketing messaging for years without adjusting for the times or the audiences they serve.
Does your website’s home page speak directly to your best clients and prospects?
Do you have different communication paths or marketing funnels for your audiences, like prospects, clients, and influencers?
A simple strategy is to feature updated messaging at the top of your website’s home page addressing what today’s economy and markets mean for investing and planning.
Another successful formula is to adjust your general pitch to new clients to highlight a current worry or what is top of mind with prospects.
For example, one advisor transitioned his core prospect presentation, How to Create Income in Retirement, to How to Create Income in Retirement in Inflationary Times.
2. Double down on marketing tactics that are working to multiply ROIs
If revenues and profits rise yearly, many advisors continue to press repeat to their marketing plans. They figure it is “working,” so why change it?
Or the activity list grows, and the promotional budget creeps with little thought to ROI.
A reversal in the markets or practice profits is an opportunity to sharpen the saw by eliminating the marketing tactics and spending that produces little trackable results.
Redeploy budget and effort towards the winning channels and specific programs producing the majority of new clients and revenue.
Check the marketing lead and sales opportunity source in the CRM for all new clients and new revenue sources over the past 12 months. This will offer a clue into where to refocus initiatives.
For example, one advisor found a single influencer who had been a top referral source. She also found one prospect webinar had yielded the most significant new clients.
This advisor combined these two winners to immediately schedule a webinar hosted by the Influencer for the Influencer’s list.
3. Open doors to activate referrals and reactivate “cold” prospects
While many advisors are in their “marketing bunkers” to wait out turbulent markets, this is your opportunity to be proactive for referrals and with “dead” leads.
Many advisors have dozens, if not hundreds, of marketing prospects who did not convert to clients over the last five years.
These past prospects may be a great list for your next campaign.
I have seen advisors experience as high as a 38% marketing response by running a direct marketing program asking for meetings with what they thought of as a “dead” prospect list.
A targeted email or direct mail campaign which yields just six to 10 new appointment requests can make an advisor’s quarter.
Invite happy clients to refer unhappy friends who are ignored by their advisor or feel anxious about their finances or financial plans.
4. Make that next strategic hire to help take your practice to the next level
Industry headwinds and challenges at the other firms may offer the opportunity to pry a top performer away from another firm.
Layoffs or a less competitive hiring environment in the general economy could also mean potential star performers could give the advisory industry and your firm a second look for the right role.
For example, many firms are taking advantage of the new work model to hire hybrid and remote assistants to fill both part-time and full-time roles.
Other firms growing despite the economy and markets become more attractive options for advisors at stagnant firms.
Hire great people in uncertain times to accelerate your plan and broaden your bench of talent.
5. Part ways with unprofitable or problem clients to free up time for growth
In my first bear market working with advisors, I got a call from one of my advisor clients.
He said, “We lost one of our big, new clients today.” I was thinking this was going to be a tough conversation.
He continued, “It was a great conversation because we both realized this would never be a fit and she was not going to stay invested during the downturn, which is core to our investment philosophy. We saved ourselves a lot of time and energy.”
Perhaps there are clients or groups of clients that unprofitable or can be better served by another advisor or firm.
Or, like this advisor’s former client, there are a handful of clients who are not a fit for the practice for one reason or another.
Use this opportunity to work with them to find a better home.
Your practice will strengthen as you release time and energy for more productive activities.
Don’t fall into the common trap of sitting on the sidelines during tough times.
Look for opportunities to strengthen and build your practice with one or more of these easy ways to recession-proof your practice.
Bob Hanson is a fractional marketer and author of Marketing Power for Financial Advisors. Get his checklist, Nine Questions Advisors Must Ask Before They Hire a Marketing Agency, Fractional or Full-Time Marketer, click here.
Read more articles by Bob Hanson
Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
