Transcript RIA Conference

Client Value Proposition
Joncarl La Rosa
Disclaimer
RI Advice Group Pty Ltd, ABN 23 001 774 125, holds Australian Financial Services Licence
Number 238429 and is licensed to provide financial product advice and deal in financial
products such as: deposit and payment products, derivatives, life products, managed
investment schemes including investor directed portfolio services, securities, superannuation,
Retirement Savings Accounts.
The information presented in this seminar is of a general nature only and neither represents nor
is intended to be specific advice on any particular matter. RI Advice Group strongly suggests
that no person should act specifically on the basis of the information contained herein but
should obtain appropriate professional advice based on their own circumstances.
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Client Value Proposition – What is it?
Two levels to consider
1.
Broad positioning statement which articulates what you do and how your
clients will benefit in their relationship with you. It is not a simple slogan – the
business must believe and deliver on this!
2.
Individual client value proposition which is specific and personal to each
individual client. Using “Values Based” questioning techniques can assist
you in drawing out what is important to them thus allowing you to position
how you will manage the ongoing relationship.
In both cases, the Client Value Proposition needs to focus on the
psychological and emotive drivers that clients will have
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Client Service Proposition v Client Value Proposition
Many people confuse the client value proposition with their client service proposition.

Client Service Proposition (CSP)
 These are the tangibles that are delivered as part of the ongoing service.
Examples include, but are not limited to seminars, portfolio reports, estate planning
etc.
 A CSP is important as this forms the foundation of the minimum fee based on
these “tangibles”.

Client Value Proposition (CVP)
 CVP focuses on the intangibles that clients don’t necessarily see (the emotive
drivers).
 This forms the foundation of what the client will actually pay, regardless of the
services received i.e. the clients propensity to pay.
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Client Value Proposition – The benefits
• Help you segment your clients as it is based on the
individual desires, values and needs of your client.
• A well articulated CVP will:
– form the foundation of an ongoing relationship and hence justify
ongoing annual service fees (Opt-in).
– help you win professional and client referrals.
– help reduce the level of “transactional” based client interactions.
Whilst transactional services can be profitable if scale exists, this
is not sustainable business model.
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Client Value Proposition – the myth
• Reality – All advisers believe they provide their clients
quality advice. Are you really better than your
competitors? Do you really have a differentiated service?
How do you know?
• Reality – Most clients would not know if they are
receiving quality advice anyway.
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Client Value Proposition – the myth
Whilst having a differentiated service or competitive edge (Unique
Value Proposition) is definitely beneficial, it is not critical to success
with prospects and ongoing client engagement.
Remember, the CVP is pitched to a client and is an emotive
driver. As long as the CVP connects with the client’s emotional
drivers, YOU WILL WIN THEM OVER
As such, understanding the two levels of CVP is essential and the
manner in which you pitch your value will be critical to the success.
CVP – Is trust an issue for you?
•
What could be the causes for the loss in trust?
– Investment losses
– Lack of contact
– Lack of accountability
•
Charles Green (US Based Consultant) built a formula for trust:
Trust = C + R + I / S
C = Credibility - your competence, track record and ability to instil confidence
R = Reliability - do you deliver what you say you will? Service and advice
I = Intimacy - how well do you engage with them on a personal level?
S = Self orientation - to what extent are you putting their interests before yours?
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CVP – Developing and implementing
1. Get everyone involved – Your staff need to know it and whiteboard:

Your ideal client - There is no right or wrong - Consider demographic, advice type,
personality etc.

The concerns or frustrations these ideal clients have and how you potentially solve
those frustrations (the benefits).

Your practices strengths or any competitive advantages (USP – not critical to success
however). In analyzing your strengths, how does this benefit your client?

Your clients feedback – use surveys or ask simple questions during reviews e.g.
- Why did you choose me over a competitor?
- What services do you value?
- What do we do well?
- What areas do you think we need to improve on?
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CVP – Developing and implementing
2. Take the key points from the whiteboard and create a short positioning
piece/story which articulates what you do and the client feedback.
Focus on the client’s key concerns and how we overcome them. The
CVP must form the foundation of what you will deliver for your clients
going forward.
3. Every staff member needs to know the CVP and believe it.
If your CVP is long, consider having an elevator pitch component to
your value prop statement – i.e. How would you explain what your
business does if asked at a BBQ that captures the key deliverables of
your CVP?
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CVP – Developing and implementing
4. Determine how you will promote your CVP. Examples
include but are not limited to:
• Client Service Agreements.
• Corporate profiles and websites.
• Alliance (COI) presentations and proposal documents
• Prospect presentations.
• Client seminar presentations
Client Value Proposition – Examples
Example 1:
At <RI Office>, we want you to live more and worry less. We are a
financial planning practice whereby our advice philosophy focuses
on our clients values and goals. We want you to have peace of mind
and confidence that all your financial affairs are in good hands.
Ultimately, we are in business to help you:
•
Streamline your finances which will save you time, remove stress and provide
contentment and piece of mind.
•
Make your money work smarter for you and track your progress over time.
•
Keep you informed of where ongoing legislative changes create opportunities or
require changes to previous recommendations which will minimise the risks.
•
Partner with you to achieve your lifestyle goals – we firmly believe life should be
more than just survival.
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Client Value Proposition – Examples
Example 2 – Actual RI Practice (Mark Tidbury):
Mark's extensive knowledge of financial markets enables him to design
investment solutions specifically tailored for you. His advice aims to help
you make the right choices for all your important financial decisions
throughout life.
Making the right choices with your money helps you enjoy more of the
things we all want: financial security, freedom and a sense of control.
Whether you face special challenges - like retirement or a career change or you just want to get ahead, Mark can help you understand your financial
options and make the right choices throughout life.
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Client Value Proposition – holistic advice model as CVP
Wealth
Lifestyle
-Private education -New car -Travel -Eating out -Holidays -Investment property
Cash Income Growth
Where you want to be
Lock in your lifestyle
- Risk protection
- Estate Planning
$0
Concerned about
managing debt?
Saving for your
children’s
education?
Want to retire
sooner?
Living in
Retirement?
Leaving a
legacy?
Your current situation
Survival
Debt
-Loss of income -Trauma -Disability -Tragedy -Caring for grandchildren - Death
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Client Value Proposition – values based advice approach
Once you have provided the client with a brief overview of who you are, what you do and
how you can provide value, its time to let them do all the talking.
Ask them in this order:
1. What does your ideal life look like?
Consider:
– Where are you?
– What are you doing?
– Who are you with?
2. What is important about money to you? Try to get the client to a point where they
reach self actualisation (e.g. brings happiness, comfort etc). – Bill Bacharach approach.
Write their responses up on a white board so that they can see it. Once you
have answered these, move onto short, medium and long term goals.
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Client Value Proposition –values based advice approach
More questions –
•
Do you feel you have an approach or philosophy to investing?
•
What is the best investment you ever made?
•
What is the worst investment you ever made?
•
Thinking about your professional relationships (e.g. accountants, solicitors) which
relationships were the most beneficial? What did you like about it? What didn’t work?
Important
•
When dealing with husband and wife, ask them both the questions separately. Don’t assume they
will both feel the same.
•
Use visual mediums – write their responses on a whiteboard so they can see it and you can refer
back to it during the course of your meeting.
•
If they raise concerns around professional relationships, provide a solution which links back to
your CVP.
•
Don’t talk too much! Listen and address concerns.
•
Agendas help!
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Client Value Proposition – Summary
• CVP is all about meeting the clients personal emotive drivers.
• You need to believe it and deliver on it. A life values based approach
to planning will help you pitch and deliver.
• Your delivery mechanism will help you sell the dream.
• Your staff need to know it.
• Don’t keep it a secret.
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Thank you