We see a common trend in mature practices, and seven years of a relatively up market has strengthened it, especially in the Business to Business space.
Mature practices—the kind run by someone who has been in the business for a few decades, has a client list of a few hundred businesses, and probably manages a couple hundred million dollars plus—have a tendency to look inward for their growth. To be clear, the business still grows, but the growth is not a result of the same kind of hustle and opportunity creation that got the practice where it is.
The business grows in part because of market growth. $130 million in managed funds can grow to $200 million after seven years of an up market. The advisor picks up a few new services or products to upsell current clients on, so there’s some growth. And then there’s the referral-generating activities—a seminar here, a golf outing there, a direct request for referrals every now and then. So the business chugs along at a completely respectable rate, but a huge swath of potential is left untapped.
That’s because the majority of the growth I just described is a result of looking inward. It comes from working with clients that you already have rather than from exploring new opportunities.
This trend is visible throughout the industry. If you attend a conference, you’ll see upward of 50 vendors, and only one or two of them will be devoted to marketing. The rest are built around new products or services or ways to improve the internal structures of your business. Inward. Inward. Inward.
The truth is that finding new prospects, connecting with them, and walking into a cold first meeting is hard. Compared to organizing a golf outing with your top five happiest clients and their best friends, it’s incredibly uncomfortable. The prospect in front of you in these situations wasn’t referred by one of your happy clients, so you’re back to the hard realities of needing a solid sales process to convince this total stranger that you’re the advisor they should trust.
At these same events, you will often see these top advisors crowding into a room to hear an advisor speak. The person on stage, however, has a practice that is sometimes 5 times as large as the biggest business in the audience, and it’s because that individual did the difficult thing: He pursued growth outside of the business. He did the right preparation so that he could capitalize on what others might see as a lucky break.
If you are happy with your business and your rate of growth, that’s fine! If you want to be the rainmaker, you need to build a pipeline that goes beyond referrals and upsells to existing clients. An effective plan for pursuing outward growth should include the following elements:
- Partnerships and alliances with like-minded business owners. Our industry is full of professionals targeting the same audiences that aren’t necessarily direct competitors. Developing a formal partnership with a CPA or professional organization can help to put you in front of new prospects.
- A consistent lead nurturing drip campaign. If you are going to do the work to get new leads and meet new prospects, you should have a consistent plan for following up with those prospects in the long term as your biggest opportunities will take time to bear fruit. Streamline your follow-up and seminar offerings so that you can regularly add new touch points to your relationships over time.
- An appointment setting program to consistently deliver new prospects. Are you going to cold call business owners? Are you going to do the research to find the right addresses to mail or the phone numbers to call? If your honest answer is no, consider hiring an appointment setting firm to find those opportunities for you, leaving you no excuse but to step into new sales opportunities.
- An advisor, mentor, or coach. Even when your business has grown substantially over the years and you have grown a sizeable practice, having an outside coach or advisor to challenge your thinking and provide new insights can help to illuminate your blind spots. If you haven’t done cold sales in a while, you should at least engage a sales coach to re-sharpen your technique.
- A big picture plan. When you’re chasing big sales, the wins you’re after might not come quickly. If your pipeline is filling up with qualified prospects, you are seeding your business for growth, so be patient with the return rate. On top of that, recognize that every new prospect opens the door to a new audience of referrals that you haven’t touched yet.
Outward growth takes time and work, but when you’ve built the right pipeline your business will hit new heights, and your growth will transform from the gradual to the explosive.
If you have any additional questions or comments, please contact us.
Thank you, ThinkAdvisor for publishing the original article: