kkchin's Blog: Alternatives To The Cold Call

Alternatives To The Cold Call
September 7, 2006 | By Glenn Curtis

Perhaps one of the hardest things about being a finance professional is cold calling potential clients in an effort to build business. Although the cold call is likely to remain a valuable tool in the foreseeable future, there are other - often better - methods that professionals can use to generate business. We'll give you a few creative ideas you can take to work.

Method #1: Hold an Investment Seminar
One method is to hold investment seminars and link up with other professionals in various fields. This will allow you to cast a much broader net in your prospecting. In other words, find a lawyer, an accountant or an insurance agent who may be willing to speak at the seminar as well. This may help you get a larger and more diverse group of people to attend. Also, if you establish a rapport with these professionals, you may be able to get referrals from them should they have any clients who need investment advice.

Why seminars? Seminars, which can be advertised in local papers - and even via the internet, if the you believe that your potential audience is tech savvy enough - are a great way to get people to open up in a pressure-free environment. They are also a terrific way to ask the audience a number of questions about their finances, goals and dreams without the time constraints that a telephone conversation usually presents.

Moreover, you may find that seminar participants will often bring their important documents with them, including copies of wills, trusts and investment holdings that can give a better snapshot of their wealth and financial understanding. In essence, the client is providing you with the tools to help you sell them your service. This is invaluable.

Make the Event Attractive to Potential Clients
The best way to make certain that your meeting is well attended is to advertise it as being a brief consultation, perhaps no longer then an hour, where you, the financial professional, will discuss the value of equities (as well as other investments) and then tie that discussion into a bigger issue, such as estate planning.

Estate planning is attractive because most investors want to make certain that their assets are passed on to their heirs with as few tax consequences as possible. This is where your expertise as a financial professional comes into play. Your ability to familiarize yourself with tax law and come across as a true expert cannot be understated. (For related reading, see Getting Started On Your Estate Plan, Skipping-Out On Probate Costs and The Importance Of Estate And Contingency Planning.)

During your seminar, it's a great idea to offer break-out sessions for those participants wanting answers to specific questions. This will help you to build a rapport with potential clients in a relaxed environment, rather than creating a high-pressure sales atmosphere. It also will provide you with a better idea of the prospects' financial well-being as well as their ultimate financial objectives. The goal here is to establish the foundation for a long and mutually beneficial relationship. (To learn about how clients might evaluate a prospective financial professional, read Shopping For A Financial Advisor and Choosing A Compatible Broker.)

Other tips for holding meetings or conferences: Try to have the event in a nice setting, preferably a reputable hotel conference center. Also, if possible, offer food. Not only will this make the event more attractive, but it also will make it more enjoyable for those who attend. Don't hesitate to give out your business card and literature about your firm, even to those who don't seem interested in your speech. If you make a good impression, those same people could call you with a question some time in the future and a few may even become your clients.

Method #2: Referrals
Beyond seminars, another way to build your book is to link up with an attorney and establish an understanding that you will both offer each other referrals. Why attorneys? Attorneys conduct real estate closings and litigations. They know when their clients are liquid and have money to invest. Ideally, as the finance professional, you could manage the clients' portfolios, while the attorney sets up wills or trusts, or effectuates other financial dealings for the clients. Again, this is a mutually beneficial relationship that cannot be ignored.

Real estate agents offer similar value. They know that after a big home sale, their clients will have a great deal of money that they want or need to invest for tax purposes. And, if you have an understanding with the agent that you will offer him or her real estate referrals, you'll probably get some business. Now think about all of the realtors in your area. That is a huge pool of potential business that you need to pay attention to. That said, as a financial professional you have a duty to make certain that neither you, nor the professional you approach, violates any ethical codes of conduct or has any conflicts of interest that could influence investors. In other words, you must learn to balance your search for new clients with your obligation to act in their best interests.

Get Your Insurance License
Lastly, as a finance professional, it is a great idea to obtain your insurance license. Why? Almost everyone recognizes the value of insurance - this is particularly true when it comes to property and casualty insurance. The simple fact is that if you have a property and casualty license, you'll be able to offer other services to your clients and perhaps open new professional doors for yourself in the process. If nothing else, it will give you an opportunity to get out of the office, see clients face to face and learn about their financial situation in a way that you would never be able to accomplish over the phone.

Conclusion
In short, there are a number of ways for brokers and other financial professionals to establish and grow their books of business without having to depend on cold calling. The trick is to be creative in your methods, and to present an environment for potential clients that is free from pressure. If you focus on creating a good first impression and learning about the individual needs of your potential clients, they will be much more likely to seek your advice in future.

By Glenn Curtis

Glenn Curtis started his career as an equity analyst at Cantone Research, a New Jersey-based regional brokerage firm. He has since worked as an equity analyst and a financial writer at a number of print/web publications and brokerage firms including Registered Representative Magazine, Advanced Trading Magazine, Worldlyinvestor.com, RealMoney.com, TheStreet.com and Prudential Securities. Curtis has also held Series 6,7,24 and 63 securities licenses.