The Elements

By Andrea Schlapia   |   August 6, 2012

Defining Client Value Beyond $ Signs

Categories: Blog, Client Segmentation, Operational Effectiveness

Segmentation is the first critical step toward greater efficiency and ultimately improved profitability. In our blog, “Take the First Step Towards Greater Efficiency With Client Segmentation,”  http://aeschlapia.wordpress.com/2012/03/27/take-the-first-step-towards-greater-efficiency-with-client-segmentation/ we provided you with basic steps and resources to segment your client database.

Start your segmentation process by defining client value.  Viewing each group with different needs and priorities will present you with the ability to serve each segment based upon their needs, not the firm’s profits.

Client segmentation is about improving customer service for all of your clients.  Use it to deliver solutions more effectively by streamlining and automating the services you offer.  Aligning the right level of advisor support to the client’s specific needs results in increased client satisfaction and in turn may even result in more client referrals.

Advancing Your Client Segmentation Plan

Client segmentation needs to be taken to a deeper lever in order to gain the full benefit.  Once your initial segmentation process is complete, you are ready to segment your client database further by distinguishing clients based on characteristics beyond the dollars.

Many advisors have not segmented their client database in a meaningful way beyond assets under management.  Assets under management will be your constant starting point for segmentation and predicting client needs.   Understanding that clients within the same segmentation class still have extraordinary needs and expectations will allow you to provide matched solutions with your product and service offerings.

Trying to provide the same high level of service to everyone can make it difficult to focus on the more complex clients and on the inevitable changes that come with growth and business development.  Ironstone can assist you in all phases of client segmentation and ultimately design a comprehensive client segmentation plan that will allow you the opportunity to hone in on specific and unique needs of clients within each segment.

Ironstone recommends  you place some of the following attributes in your segmentation plan beyond assets under management:

  • Revenue produced for the firm
  • Quality of your relationship with the client
  • Earnings potential
  • Client lifestyles & life events
  • Client demographics
  • Risk analysis/Behavioral attributes

Applying the above listed characteristics will provide another layer to your segmentation plan and aide in shaping optimal service for your clients.  You may not want to engage in each market base, but you can start with the characteristics that employ the biggest role in improving your firms’ bottom line.   By marketing to each subcategory you will accomplish more targeted messages and information that will resonate with your clients, resulting in engaged clients and prospects, higher response rates and a shorter conversion cycle.

Use this model to segment your clients by determining their level of revenue and the value of the business relationship.08.06.12 Segmentation Guide

Readers, we are curious!!  How do you approach segmentation in your firm?

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  • Business Development
  • Operational Effectiveness
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Andrea Schlapia
Organizational Development and Human Capital

Andrea Schlapia, RCC™, HCS, sHRBP, is the Founder and CEO of Ironstone, which represents the culmination of her 20+ year career within the financial services industry. Her experience began as a financial advisor evolving into a consultant coach for advisors entering the field. This ignited her passion to support others through learning and development of best practices in order to achieve substantial results. To this end, she followed her desire into positions of senior-level practice management specialists for Dreyfus, Prudential, and DWS Investments prior to the realization of Ironstone.  Andrea’s focus is on practice management strategies to enhance and improve both business and personal life.

Andrea identifies 4 key performance areas known as the Fundamental 4™, which are required to design, develop, and sustain a successful business. Through coaching sessions and speaking engagements, she captivates her audience with interactive, high-energy presentations which are built with “how-to” strategies resulting in real-world implementation for significant impact. Andrea has been featured in multiple publications and audio broadcasts as a specialist and distinguished spokeswoman in the financial industry.

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