Only a fifth of advisers have developed defined profiles for their target clients, according to a new report from NextWealth and Aegon.
When asked to describe what they had done to support the growth of their business, 22% of advisers said they had developed clear and defined profiles of the types of clients they want to attract, while 47% said they had a general idea of their target clients.
One in three (30%) said they had no target profiles at all.
According to the duo’s report ‘Organic Growth for Financial Advice Firms’, referrals from existing clients is the number one channel for client generation, regardless of adviser efforts to profile targets.
However, beyond referrals from existing clients, the research showed that advisers with defined target profiles are more likely to generate new clients from a wider range of channels. In particular, advisers with defined client profiles were ranked number one for client generation via referrals from professional third parties, finance events and digital marketing.
Dr Tom Mathar, head of Money:Mindshift at Aegon, said: “When looking to understand the types of clients you’d like to bring under your wing, it’s important to remember that the numbers are often just the tip of a more human-centric financial iceberg.
“Each of us has a variety of motivations, values and priorities that guide us through many of the decisions we make in life, including whether we’d like financial advice and who from.
“By building target client profiles that centre on fully formed visualisations of the people and lives you believe you can help, you will be in a much better position to onboard the types of clients you want to work with, deliver a better service as a result, and become more referrable down the line. It’s the starting point for a relationship that is more rewarding and fulfilling for both you and your clients.”
Heather Hopkins, managing director at NextWealth, added: “We were inspired by a comment from an adviser who said, ‘It’s like setting a financial goal for a client and saying, this is how we’re going to get there.’ That’s exactly the thinking behind this guide.
“In advice, you wouldn’t skip the step of defining what growth is for or how you’ll measure success. The same applies to growing an advice firm. A clear picture of your ideal client sharpens your strategy, aligns the team, and makes every referral or marketing effort work harder.”
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