What’s one of the top reasons clients decide to part ways with their financial advisor? If your answer is poor service or experience, you’d be right.
According to Morningstar, the number one reason investors fire their advisors is a lack of quality service. It’s not just about wealth management or returns—it’s about delivering an exceptional client experience that keeps clients loyal and eager to recommend you. And other reports note that three of the top four reasons clients leave their advisors are all service related.
If the thought of losing a client because of subpar service makes you uneasy, don’t worry—there are two foundational pillars you can build within your firm to prevent that from happening. The two pillars that can not only help you meet—but exceed—client expectations are:
- A segmented service model
- A client advisory council
By dedicating time and resources to these initiatives, you can transform your clients into your biggest advocates while creating a more efficient, profitable, and client-focused business.
Pillar No. 1: A Segmented Service Model for Stellar Service
Clients today expect more than just financial advice—they want to feel valued, understood, and prioritized. Delivering a one-size-fits-all approach isn’t enough. Exceptional client service requires intentionality, forethought, and continuous refinement. To build a practice that truly stands out, you must first understand what makes your ideal clients tick—and that’s where the first of the two pillars comes in.
Having a segmented service model ensures you’re delivering a consistent level of value to all clients while tailoring your offerings to segments of clients with similar needs for efficiency and sustained profitability. It will help you answer the question: How much of your time and resources per year are the right amount per client?
When you segment your clients, you avoid spreading yourself too thin. You can prioritize attention and resources toward your most valuable clients while maintaining consistent service levels across your entire book of business.
Here are the steps to creating a segmented service model for your firm:
Step No. 1: Rank and segment your clients. Group clients based on factors such as revenue, referrals, and alignment with your ideal client profile. Consider not just assets under management (AUM), but also their relationship potential and the value they bring to your firm overall.
Step No. 2: Identify your break-even point. Review your client list and determine the revenue required to sustainably service each client segment. Understand which clients are profitable and which ones currently require a disproportionate amount of resources for the income generated by the relationship.
Step No. 3: Define service levels. Document a clear menu of services for each client segment, ensuring your team understands what each group should receive. Clients should know exactly what to expect—and your team should be able consistently deliver. This exercise can open your eyes to more than service consistency—you may realize you need to add staff, adjust fees, or change servicing processes.
Step No. 4: Enhance transparency. Communicate the available services with all clients to prevent misunderstandings. Highlight value-added offerings such as estate planning or tax strategies, emphasizing your comprehensive approach. It’s not uncommon for clients to leave an advisor because they didn’t realize the full breadth of services available to them. Clearly defining and communicating your offerings enhances retention and builds trust.
Step No. 5: Take action for unprofitable clients. If certain segments don’t align with your business goals or require excessive resources, transfer them to G2 advisors or refer them to external firms. Freeing up time and headspace lets you focus on serving your ideal clients at a world-class level.
A well-executed segmentation plan results in:
- Consistency: Every client receives the promised level of service.
- Profitability: Resources are allocated effectively, maximizing ROI.
- Clarity: You and your team can confidently prioritize and serve clients intentionally.
Additionally, segmentation ensures your team spends time building meaningful and beneficial relationships with the right clients, rather than overextending on unsustainable engagements.
Pillar No. 2: Building a Client Advisory Council
Think of a client advisory council as your personal focus group—an elite group of your best and most loyal clients who are willing to provide honest feedback and insights about your services. These aren’t just clients you enjoy working with, but individuals who are connectors. Connectors are people who naturally love to share their experiences and help others, acting as champions for your brand.
Why is a client advisory council important? Because your clients know better than anyone else why they do business with you. They can tell you why they chose your service over someone else’s and what keeps them coming back. More importantly, they’ll offer insights into their preferences and how you can attract more clients like them.
Beyond providing invaluable feedback, a council builds deeper relationships with your core clients. Members feel valued and honored that you trust their input, and this goodwill often results in stronger loyalty and referrals. It’s a two-way relationship—they feel good helping you, and you get invaluable feedback.
If you’re just getting started (or wondering where to begin), here’s a step-by-step guide to setting up a thriving council:
Step No. 1: Identify your ideal clients. Narrow your list to eight to 12 of your top clients—those you’d love to replicate. Look for individuals who are passionate, social, and eager to help. They should be the type of people who love to connect with others and thrive in social or professional circles.
Step No. 2: Ask for a commitment. Reach out to these individuals directly, either in person or through a thoughtful message. Explain how much you value their input and invite them to join your council for a two- or three-year term. Most people will feel honored and excited to play a role in helping you grow.
Step No. 3: Host twice-yearly meetings. Schedule two meetings per year. Meetings should be an engaging lunch or afternoon session lasting about two to three hours. Always have food and snacks to make it enjoyable. Make sure to have team members coordinate the logistics, and always provide a clear agenda for the meeting. Keep the setting comfortable and professional—clients should look forward to attending.
Step No. 4: Ask for honest feedback. Focus your meetings on open-ended discussions about what your firm is doing well, areas for improvement, and innovative ideas to elevate client experience. Show that you value their feedback by reporting on progress in subsequent meetings.
Step No. 5: Regularly evaluate the council mix. The success of a council hinges on its members. Watch for signs that the group isn’t the right fit—like lack of engagement or overly dominant personalities. The right mix of members is critical for fostering open, constructive dialogue.
A thriving client advisory council leads to tangible results. If your council is successful, you should notice:
- Valuable feedback: Insight that helps you improve services or processes.
- Ideally, one referral per member per year.
- Engagement: Members who are genuinely excited to contribute and participate in your growth.
If your council isn’t yielding these results, re-evaluate the group dynamics and your approach. Remember, it’s not just about gathering feedback—it’s about creating meaningful connections and generating referrals.
Delivering World-Class Experiences
When it comes to creating raving fans, it’s not enough to merely deliver financial advice—you need to create an experience that clients love to talk about. This means listening to their needs, exceeding their expectations, and always looking for ways to refine your approach.
Start by focusing on these two foundational pillars. Together, they’ll provide clarity, intentionality, and results that will elevate your client experience and transform relationships—plus lead to new relationships.
By committing to these pillars, you’ll not only retain your top clients but you also might attract new ones. Your clients will become your strongest advocates, sharing their enthusiasm with others.
Remember, creating an incredible client experience isn’t just about growing your business. It’s about making every client feel special, valued, and cared for. That’s how you can build a firm that thrives and stands the test of time. If you need help building these pillars, get in touch with us!
