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30 Cards in this Set

  • Front
  • Back
What is an account at a brokerage firm?
It's like an account at a bank except it can contain various securities as well as cash.
What is a "Household?"
It is basically a client unit. A household is one or more decision makers united by common financial goals.
Can a Household be a corporation?
What is the abbreviation for Household?
Why do we ask about household rather than accounts?
The number of actual clients units is what the industry mostly focuses on?
What term is used, mostly in a wirehouse by an advisor but can also be used by an Independent to refer to all his or her clients?
Book Comes from the days each client had a sheet of paper in note book.
What's another term for "Household?:
Buying Unit.
What does the term "Net New Household" mean?
It's a term used in wirehouses to mean the number of new clients minus the number of client's lost.
What's an average net new households in a wirehouse.
In UBS in 2004, it was 1.76 per FA. This low new client production is a source of major concern in national firms.
Bare minimum, how much prospecting is "enough?"
New HH need to be sufficient to replace 10%% of an FA's assets in the event of a market downturn. This assumes the FA believes the worst likely to happen is the market will go down 10% in the next year. With a 10% flow of new clients, the FA's asset base will stay the same and income will not go down. It good times, income will go up.
When the FA comes on Gorilla, how much prospecting is enough/
Over a two years period, the new Gorilla needs to plan on increasing account base by 50? From long experience, we know hat an FA's ability to double production will come roughly 50% from finding more assets from current clients and 50% from new prospects?
What is strategy for launching a new system?
We always start with client marketing first. It's less intense and it enables us to go find some money to help finance the next step. While we are bringing up client marketing, initially with the Find the Money campaign, we buy some additional selling time by getting a computer operator and working toward improving your service support. Once we have bought some time and found some money, we can then launch prospecting with having you experience the usual income reduction plan associated what usually happens when an established producer starts prospecting.
Why does an established producer usually experience a drop in production when he or she starts prospecting?
Prospecting has a longer pipeline than client sales. If you allocate time that was going to clients and spend it with prospects, your income WILL do down.
What is the most frequent method of generating new clients?
Repeated surveys have shown its referrals.
In addition to referrals what is the method most people cite as the second most frequent method of prospecting?
What do FA's mean by "networking?"
Becoming active in various groups so as to meet new people.
What's the biggest problem most people experience in their networking?
It is socially inappropriate to solicit one's friends and they have no way to keep their name in front of business contacts and social connections to subtly encourage various people to bring up the subject of investments.
Why don't FA's prospect more?
To do it right, it takes a huge amount of time to develop, on their own, a decent campaign. That is what causes the income reduction plan?
How many clients should a referral marketing campaign, such as the "Promote referrals" strategy we follow, produce?
It should generate about 10% of an advisors client annually?
What are the five relationship marketing strategies
Promote referrals: develop strategic partners; clone your best clients; Promote to your business contacts; develop your social connections.
What are the principal mass marketing strategies
seminars, mass mail, mail/phone to business, cold call business, cold walking where the FA goes out and shakes hands.
What is a referral?
A name volunteered by a client or prospect as someone needing the advisor's help.
Why don't we believe in soliciting referrals?
Because it puts the client on the spot, making them uncomfortable, and because asking for referrals does not generate referrals it generates names which are hardly better than a cold call list.
What is a strategic partner?
A person in a related area of financial services or even another industry who has allied with a financial advisor to both serve the interests of the client.
What is a strategic one way street?
A situation in which a financial advisor gives referrals to someone and does not receive an equivalent flow of business in return.
Which professional is notorious for receiving but not giving referrals in return?
Estate Planning Attorney
Why don't estate planning attorneys send referrals to financial advisor?
Because they receive referral from multiple financial advisors. Most of their clients will be another advisor's clients. If they were to refer a client they get on their own and another advisor hears about it, the one not receiving a referral would cut off the attorney.
Name five strategic partners we recommend they acquire.
Estate planning attorney, basic and advanced. Tax preparer, CPA, residential real estate agent, Property ad casualty agent (P&C), commercial real estate (if a number of clients own income residential property), .
What is a "tax preparer" as opposed to a CPA?
A "Tax Preparer" is usually an "enrolled agent." This is someone who has passed some tests administered by the IRS and is considered qualified to do simple tax returns;. A CPA stands for Certified Public Accountant. This person has taken accounting in college and has passed a CPA exam. They are qualified to do complicated returns as well as deal with accounting systems in businesses.
What is our strategy to help the FA find an estate planning attorney who can become an actual strategic partner?
We want to find someone younger who does not have all his or her relationships in place. When the FA comes to class, we will explain how we locate these people.