"In a manufacturing process, things get done the same way every time," Vessenes says. When top planners meet prospects, she says, they, too, usually have a highly organized approach.
"One of the things that I noticed over the years when talking with other financial planners was that the big guys - the ones making $1 million a year or more - generally had what I call a defined sales process," Vessenes says. "The smaller guys had no defined sales process in place. Every meeting with clients was different."
Vessenes, a CFP and RFC who's also a lawyer, created her own defined sales process around 2000 and began using it at Vestment Advisors, which is both a financial planning firm and a professional consulting firm that helps advisors build and improve their practices. Her approach involves four to five major meetings with new clients and prescribes in detail what should happen in each meeting.
Before putting the defined process into effect, her closing ratio had been about one in three, Vessenes says. "Once I began testing the defined sales process," she says, "there was only one prospect who I didn't end up closing."
The defined sales process is not "one size fits all," she notes. Each planner should create a process based on his or her own practice and its typical client profile. But, Vessenes emphasizes, once you've created a process that works and tweaked it, you should stick to that path in almost all situations.
Related Content
Besides increasing closing ratios, a defined sales process is also likely to improve a practice's efficiency. "My team knows the process that I use, and they know what I plan to do in each and every client meeting," Vessenes states. "As a result, they know what documents and support they need to provide to me before each meeting."
In Vessenes' practice, prospects are usually identified at dinner parties for 10 to 20 people. "We serve them a nice dinner, and it is an educational event," she says. "What the event covers depends entirely on who the target market is." Once a prospect has expressed an interest in getting advice, the sales process kicks into action.
LOOKING FOR PAIN POINTS
For Vessenes, the first one-on-one meeting is a "get to know you" session. "I ask questions and get to know as much as I can about the prospect," she says.
One thing she wants to learn during this meeting is the prospect's "pain points" - worrisome or uncertain areas in his or her financial situation. For a couple mainly interested in preparing for retirement, for instance, issues of concern might be whether they will run out of money before they die, what will likely happen with taxes and inflation, and how they can maximize their tax-free income during retirement.
She has found that if a prospect has only one or two pain points, it is unlikely that she will be able to be of much help. She looks for clients who have at least four or five pain points.
In a second meeting, Vessenes delivers a proposed financial plan to the client. "In addition, if it looks as if the client is a candidate for disability insurance, life insurance or long-term care insurance, we may take applications at this meeting," she adds.
In a third meeting, Vessenes talks about how she would manage the client's money. "We go through our investment philosophy and how it works," she says. "If they are on board, they can move their money over to us at this stage to manage it. However, some of them may want to get more information first or think about it."
At a fourth meeting, the prospects have become clients, and it is time to talk in detail about putting the strategy into effect. "We describe the portfolios, including what percent would go into equities, what percent would go into bonds and so on, so they know where it is going," she says. "I also provide them with information on how they can log in to their accounts."
In most cases, this slate of meetings would be enough. If clients have further questions or issues along the way, however, Vessenes might decide to schedule a "Meeting 2.5" or "Meeting 4.5."
"After each meeting, we set a specific date for the next meeting so that these don't fall through the cracks," she says.
