So you want to grow your business? If you want to accelerate growth you need to start looking closer at the numbers.
In any corporate environment the leadership teams will talk about the numbers; it’s what drives decision making. Yet, in the majority of financial planning businesses, decisions are made on ‘gut feelings’ or because it ‘worked in the past’.
Those firms that want to grow, either organically or through external investment, need to take the guesswork off the table.
So, if a focus on growth is important, what are the most important metrics a firm needs to have sight of… and why?
Revenue report:
yep, it’s that obvious… but you need to be able to dig into the detail. The total amount of revenue generated by the business over a given period of time, broken down by client, adviser, new business and ongoing fees. Are some advisers starting to lose sight of new business and just happy to sit on recurring fees?
New client report:
this report shows the number of new clients acquired by the business. It should detail the average revenue per client, by adviser and the source of the client.
Are some sources responsible for higher value clients? This insight should drive decisions about marketing spend and sales activity.
Are some advisers better at generating referrals than others, how can this skill and experience be passed on to others?
Marketing report:
if you’re capturing new business revenues and sources you should be able to track marketing ROI.
Web enquiries are often the result of PR and social media activity. The more sophisticated platforms like Hatch will also tell you where the client originated, such as a mailing list or event.
It’s sometimes not an exact science, but having some understanding of what is and isn’t working is essential.
Lead report:
it’s as important to understand leads as it is new client wins, and this is where many businesses fall short. Many track new client wins but don’t report on enquiries that didn’t convert. Let’s be clear: enquiries include call referrals from introducers and clients, many of which don’t get logged as they fall into the adviser’s admin black hole.
You need to be able to see where enquiries are coming from to identify where opportunities exist for improvement.
Which leads us to…
Conversion report:
it’s important to track conversion rates, from enquiry to new client. You need to understand conversion performance by adviser, client value and source, so you can spot trends and answer such questions as:
Why are referrals from one introducer converting at a higher rate than another?
As a conversion percentage, why does the business lose out more on higher value clients than those with a lower net worth?
And here’s a thing I’ve seen… an adviser with a mature, high value client bank, is less interested in following up on the lower value lead (a referral from one of their clients), but that potential new client would be a great opportunity for a less experienced adviser.
You need to be able to spot the opportunities and act accordingly to drive value into the business.
Client satisfaction report:
all our clients think we’re great! Yeh, they probably do, as invariably they have nothing to compare you against, but this is where complacency creeps in. It’s important to go deep on client satisfaction to identify areas where the business can improve.
What parts of the client experience don’t they like? Here’s one - form filling and paperwork. But they don’t moan about it as they think it’s par for the course. It doesn’t need to be so painful; there are ways to improve.
Client attrition report:
agreed, there are some clients who you don’t mind losing. But much like new opportunities, lower value clients on an experienced adviser’s client list will almost certainly get less attention than they would in a less experienced adviser’s client portfolio.
It’s important to track client attrition to identify themes and trends that can be addressed to retain value in the business.
If you get all the above in place you’ll start to make more informed decisions that are pretty much guaranteed to improve business performance.
Is it time to stop trusting your gut and getting some hard facts to scale and grow?
If it is, it may be time for Hatch.
Want to find out more about how Hatch can help your business?
Book a demo today and lets talk.