January 23, 2023 – New Year’s resolutions come and go, but most financial professionals have an ever-present goal: growing their practice. Over the past few years, growth has come relatively easily. As markets enjoyed a years-long bull market, client assets grew in tandem, and financial professionals didn’t need to work as hard to build their practices. This year brought a much tougher investing environment, and the period of easy growth may be over.

Yet there are some clear strategies that financial professionals can apply in order to grow in 2023 — some concrete, and others that are emerging into solid new options. Consider them a playbook for growth in the coming year.

Pace yourself and devote sufficient time to marketing

A big mistake that some financial professionals make is “yo-yo” marketing. They don’t think much about proactive marketing when they feel good about their practice. When they feel nervous (e.g., when they lose a big client), they make it their biggest priority for a few weeks and then it tapers off again. A better approach is to set aside a specific amount of time each week — maybe three or four hours to devote to marketing. It may seem like you don’t have any free minutes to spare, but outsourcing some administrative tasks like back-office functions or even investment management can free up critical blocks of time.¹

Read more of CNL’s insights on marketing for financial professionals:

• How Financial Professionals Can Capitalize on Social Media
• Standing Out From the Pack
• Three Ways to Strengthen Your Firm’s Brand
• Get Big Feedback With Little Surveys
• Map Your Way to a Better Client Experience
• PR like the Pros-Five DIY Tips for Financial Professionals

Refocus on referrals

Referrals are a tried-and-true method of cultivating new business. Some firms make informal requests for their current clients to pass along the names of friends or family members who may need financial guidance, while others have a more formal program. In the latter category, download CNL’s Second Opinion Service (S.O.S.) flyer that shares a program in which you offer to provide a second opinion about the financial health of their portfolios. This is a model that most people are familiar with: getting a second opinion from a doctor about a health care decision. For potential new clients, it’s low-pressure and low-risk, and you’re offering them something of value (your expertise) essentially for free — a show of good faith that can start to build trust.

In addition to current clients, you can cultivate other sources for referrals — particularly human resources consultants at large companies in your area. Those professionals see people at big junctures of their life with financial implications — a job change, marriage, divorce, birth of a child, inheritance, or other big shifts. For that reason, they can be a great source of new business.²

Deepen relationships with your current clients

It is easier to get more business from existing clients than to acquire new clients.³ To claim a bigger share of assets from the people you already work with, deepen your relationships with them. Understand their needs, listen to their concerns, and determine how you can best help them reach their financial goals. Some advisors are implementing customer relationship management (CRM) software to generate data that can help them track client information and personalize interactions. But that hasn’t become the norm yet; many financial professionals are not using data to capture their client information.⁴

Building relationships with the children of your clients is another way to help deepen the relationship with your client, but also creates a pipeline for future clients. Here’s more in depth information on how to start that process.

Target younger and more diverse clients

Most financial professionals deal primarily with older investors, and for a good reason — those people are more likely to have sizable assets. But growth requires looking to the future and targeting tomorrow’s investor base. Millennials and Gen Z are those born 1981-2012, and are almost half of the overall population, making them attractive prospective clients. As Baby Boomers retire, millennials will become the highest earners due to their higher education and more disposable income.⁵ While Gen Xers, born 1965-1980, are still supporting older children and may be responsible for their elderly parents.⁶

Winning over this group likely requires adjusting your offering, with a greater reliance on technology and different types of guidance. For example, younger clients may be less focused on longer-term goals such as retirement planning and more focused on immediate priorities such as addressing student debt or saving for their first house. At the same time, younger investors are more likely to be demographically diverse. For that reason, financial professionals may need to recruit and hire younger and more diverse employees to create the kind of firm that reflects and attracts those potential clients.⁷

Create value for your clients in volatile markets

Last, perhaps the most effective way to generate new business — from your existing client base and potential new clients alike — is to ensure that you’re creating value in all kinds of markets. That’s especially true in the current environment, with high volatility and significant uncertainty among many investors. Even the best marketing program won’t succeed unless you can execute the fundamentals. That means staying abreast of asset class performance changes in different markets. Also, finding solutions amid current market volatility, such as non-traded alternative investments, which generally are less correlated with the publicly traded markets.

In sum, focusing on new ways to strengthen your business is a critical component of practice management, and it’s a way to generate growth regardless of what’s going on in the market.