Kaselnak’s Marketing Knack

The biggest marketing problem most professionals have is…Getting stuck.  Stuck in the muck.  Stuck in the muck that sucks them down into sameness.  They cannot take the step to do something different then either they have been doing or someone they know has been doing.

When they see a new marketing idea they think…

“I’m just not sure if it will work for ME.”

They want to know…

“Is there someone I can talk to that has used this idea to see if it works?”

Or

“How exactly are professionals like me using this idea to increase their bottom line?”

“My business is different, how would it work for me?”

I hosted a national conference for 150 of the top financial advisors in the country last week in St. Louis.  One incident really pounded this problem home to me.

I had just rolled out a new and unique marketing system (1-2-3 lead generation) that had been used very successfully by 5 different advisors across the country.  These 5 advisors that had utilized the system successfully looked nothing alike.  They were young, old and in between.  They were in cities, suburbs and rural areas.  They had experience levels from 3 years to 29 years.

And yet they had all utilized the system to create huge revenues.

They had spent on average about $500 on the system and had huge success with it.  They had average over $15,000 in commission using it.  Not bad huh?  $500 investment converts to $15,000 in commission. What is that a 3,000% return on investment?

So here’s the funny thing.  As soon as I presented it, the questions started flying.  These top advisors wanted to start changing it immediately.  They started to come up with reasons as to why this marketing system wouldn’t work.

And then our keynote speaker stood up and marched up to the podium and grabbed the handheld mike and shouted,

“WHAT IN GOD’S NAME IS WRONG WITH YOU PEOPLE?  MIKE JUST GAVE YOU A SYSTEM THAT HAS HAD 100% EFFECTIVENESS WITH 5 OF YOUR PEERS AND YOU HAVEN’T EVEN LEFT THE ROOM YET AND YOU WANT TO CHANGE IT!………

GUYS! TAKE THE SYSTEM.  GO HOME AND IMPLEMENT IT AS INSTRUCTED.  AND REAP THE REWARDS…

OR SPEND THE NEXT 6 MONTHS REVAMPING IT TO YOUR TASTES AND CREATE SOMETHING THAT IS GOING TO SUCK!”

With that he put the mike back and walked back to the back of the room where he had been observing.

There was complete silence for about 15 seconds and then the whole room burst out laughing.  They had been caught practicing the biggest pitfall a professional has…taking something that is proven successful and Trying to change it before they Try it!

People, instead of convincing yourself why marketing technique will or will not work.  Try it.  Let the results speak for themselves.  You will never believe it will work for you, no matter how many testimonials, until you see it work in your practice.

If a marketing technique does not cost an arm and a leg, just try it and quit trying to figure out why it won’t work.  Marketing experts get paid hundreds of thousands of dollars to do that and they are still wrong more often than right!

As Nike says,

Just do it!

I get the question over and over.  “What is the most important thing to do to build a successful practice?”  I’ve been saying the same thing over and over, great marketing.  But most people go, “Oh.”

They want a more exciting answer.  So I went out to the proverbial studies to see if they backed me up, and here is what I found.

Most advisors became advisors due to their love of finances, not due to their love of marketing.  Unfortunately, as in many things in life, there is a catch-22.  You won’t be an advisor for long if you don’t know how to market.  The road to a successful financial planning practice is littered with very bright financial plannners that never figured out how to market.

What do I mean by “how to market?”  There have been several studies by Financial Advisor Magazine, Tiburon of Strategic Advisors, CEG Worldwide, Moss Adams and many others in the last few years looking at successful advisor practices and what makes them successful.

It ends up (big surprise) that marketing spending and growth of assets under management go hand in hand, regardless of the size of the practice.  Small firms that spent 30% of their revenues on marketing grew their assets at a whopping 50% on average.  Was there a difference for large firms managing $100 to $500 million?  Nope, same thing.  More marketing means more money.

It appears more and more advisors get this as a recent S&P Corp. study found that advisors spent more in 2006 than in 2005 on marketing.

OK, marketing is good we get it, right?  So where is the best place to spend your marketing dollar?  On branding?  On radio? On seminars?  Nope, it ends up all studies point at just one thing.  And the good news is it’s the cheapest kind of marketing!

Contact.  What?  Contact!  What like a phone call, email, newsletter or handwritten note?

Yep, and often!  It turns out that the really successful advisors contact their clients or their prospects between 24.1 and 28 times a year (depending on which study you look at.)

They also found that while any type of contact is good, there is a type of contact that works better than all the rest.  Many advisors I talk to guess it is email.  When I ask why they tell me because it is fast, easy, cheap and convenient.

Hmmmm. That stuff all sounds good doesn’t it?……for the advisor.  Advisors love fast, easy cheap and convenient contact because they can email their whole client and prospect data base in 1 second.  That is the very reason that while email is an excellent way to communicate information to your clients, it is the weakest link in either building loyalty in your current client data base or wooing new clients.

Your clients and prospects know that it takes you very little time and effort to email them.  Yes they appreciate your prompt delivery of information to them but they view your effort as minimal.

So what is the best ways to contact them?  Phone call, personal meeting or handwritten note.

Hmmm. What do all of these have in common?  They require time and effort.  Interesting, the things that require time and effort are the very things that are linked to the most successful practices.  They are willing to do the things other advisors are not willing to do.

Want to be successful in any type of business?  Do the things your competitors refuse to do.

Guys and gals, I just got off the phone with someone that insisted I communicate through some sort of instant messaging on the computer.  How idiotic!  What would have taken less than a minute to communicate on the phone took over 5 minutes on this silly instant messaging thing.  I was complaining about it when my “techie” told me it was so this person could talk to me and 3 other people at the same time.  HOW HORRIBLY INCONSIDERATE TO WASTE 5 minutes of my time, and the time of the other 3 people, just to convenience themselves!

Common courtesy seems to have been misplaced in today’s fast paced world.  The good news is that for those that practice courtesy, it is easy for them to stand apart from the pack. If they are trying to close a big deal, get access through a gate keeper or for that matter win the love of a sweetheart, a handwritten note is often the ticket.  A handwritten note is given a special place in people’s “mail sort piles.”  It is given a place of honor. It is recognized as often the only piece of mail that is desirable to read. For those that practice the art of the handwritten note, the rewards are both emotional and monetary.

What is the Difference Between a Good Lead and GREAT LEAD?

It’s as easy as:

“They don’t care how much you know until they know how much you care.”

Great Leads contain the answer to:

• How does your Mother know that you care?

What is the #1 indicator to your Mother that you care?  Contact. Contact on her birthday. Contact on the Holidays.  Contact out of the blue just to check in with a story or a kind word.

Though we are not selling to our Mothers, Contact is the universal demonstration of caring:

• If you want your girl friend to marry you, you are going to need plenty of contact (Not that kind!  The notes, dates and phone call kind)
• If you want an acquaintance to turn into a friend it takes contact
• If you want any type of relationship to occur it takes contact

Great Leads are MADE not Born (good leads are born)

Good leads can be generated by coming up with a catchy headline or a neat idea.  A good lead will get people calling you about your nifty idea, they’ll want more information.

Great leads create a relationship with the receiver.  They will demonstrate that you care (saying you care is worthless, it must be shown.) That demonstration is in the universal show of caring…contact.

A Great Lead get clients…good leads get people seeking information only.

How do you know if something work?  I suggest the “Real Life Test.” Think of a real life situation…put the idea to work in that situation…see if it works.

10:1 Real Life Test—
“Straight to the point”–Let’s say you move into an office next to a Property/Casualty agent.  The very 1st week he comes over and introduces himself, hands you a card and says he can beat your current coverage.

What would you do?  I would politely tell him I already have a guy that I work with, thanks anyways.

“Hi ya neighbor!”—Let’s say instead of coming over to present his business in the first week, this Property/Casualty guy comes over and asks if you need anything.

Then he starts dropping by every week, just to say hi or talk about the weather, share a joke or ask about your family for a minute or two.

He does this for 3 or 4 months.  He has now had 10 friendly conversations with you.  You have built a relationship and have become comfortable with each other…

He then says, “Say, I saw you the other day with a boat behind your truck.  My company loves boaters!  We have a great boat protection program.  Would you mind if I gave you a quote on your boat?”

What would you do? I would feel obligated to say yes.  Why? Well, first he just simply asking for a quote.  He seems up to this point, nice and caring.  He has never pushed or bothered me before.  Heck, what could it hurt? And maybe I will be able to save some money.

10:1 Ratio WORKS!

If you contact your prospects with nice, friendly and NON-FINANCIAL handwritten notes 10 times they know that you are a caring person. (handwritten notes are even more powerful than conversations because of the perceived time it takes to send one.)

Then when you touch them with a helpful, financial (call to action) message, they know you are doing it to be caring, not doing it to sell them something.

How often can you send a selling message?  After every 10 NON-FINANCIAL or what I call caring contacts. (Why 10?  Because we tried more and less and 10 is the sweet spot)

So what type of leads are you going generate? Those that attract people that want to suck information from you or those that create relationships with your prospects.  Choose carefully because your choice will shape your future practice.

As financial planners we constantly let our clients know how important it is to plan.  Well it’s time we took some of our own medicine when it comes to referrals.  Planners know that referrals are the life blood to a highly successful practice, yet I can count on one hand the number of planners that have a formal referral system set up for their practice.

As you tell your clients:
“You don’t plan to fail, You fail to plan.”

So let’s take a thorough look at referrals and how to set up a simple method to drive your number of referrals through the roof.

1.  Why are referrals so important?
In today’s environment, it is becoming more and more difficult to get in front of people. Regulators and over-saturation make seminars more difficult and less productive.  Broker Dealer compliance departments have turned into sales prevention departments.  The public and press have become much more skeptical of us and what we do (more people are becoming do-it-yourselfers than ever before).

Referrals are no longer a luxury but are becoming a necessity.  They are important for many reasons:

• There is no more effective way to see a prospect than from a referral.  They are already pre-sold on you thus making the sale much more likely and the process, from start-to-finish, much faster.
• They are the least expensive, highest quality leads you can get.
• You build a clientele that all knows each other making it harder for people to leave you.
• You are protected from problems outside your control that would interfere with your lead generation e.g. A mailing that misses that causes you to cancel a seminar, an advertisement that is faulty because a product changes its interest rate after the ad is already placed, paying a lot for “qualified leads” that have you driving around town only to have the lead pull down their shade when you pull up to their driveway.
• For regulatory purposes it is a lot better for a prospect to call you than for you to solicit business from them.  Let’s face it! The regulators believe us guilty until proven innocent.  You are insulating yourself from regulatory questions by the fact the prospect made the first move.

Advisors that have not put formal referral programs into place may soon find themselves wondering where their next deal is coming from, and that is not a successful business model.

2.  What type of referrals are best?
I have to laugh at 90% of the referral systems I see.  They all revolve around asking for referrals.  PLLEEAASSEE!  Who do you remember that asked you for referrals?  The window salesman?  The siding salesman?  The car salesman?  (Probably not your doctor!)  And what did you tell these guys?  How did it make you feel?  Embarrassed and uncomfortable?

Do you want to put the clients that you worked so hard to get in a situation where they feel uncomfortable around you?  Oh, by the way, if you don’t think it makes your clients feel uncomfortable when you ask them point blank for referrals you had better work on your empathy skills.  But Mike!  They smile and say they would love to give me referrals when I ask them!  I believe you.  Can I ask you a question?  When one of the above salespeople asked for referrals did you yell at them and get angry?  Or did you smile and ask them to let you think of some names?  Just ‘cuz they smile doesn’t mean they are happy.

Besides, if they do give you names when you ask for them, what do you think they do after you leave?  They call those folks and apologize for giving their names out and say that you may be calling, “But don’t feel any obligation, I mean, I probably shouldn’t have given him your name, sorry about that.  Just tell him you’re already taken care of.  I don’t know what I was thinking giving out your name.”

Great referral, huh?

The best referral is one given of their own volition.  Given the same way that they rave about a new movie or restaurant unsolicited to their friends.  Given in the same way they recommend their mechanic that they just love when their friend is having problems with their car.

You see, when they give the referral because they truly want to help their friend, not just to satisfy your request, they will try to “sell” their friend on you.  Think about this.  Do they really care whether a friend of theirs goes to a movie they liked or not?  No, but think about how they start promoting the movie telling their friend how great it is and that they would love it.  When you recommend a restaurant you start telling your friends all the reasons they should go and if they resist, you start to sell it harder.  It’s weird. It’s almost as if you have a vested interest in their accepting your referral.  In a way I guess you are vested.  If your recommendation is rejected, then you feel somewhat rejected.

The only referral worth having is one that is given by somebody that thinks enough of you and their friend to have them come see you…WITHOUT YOU HAVING TO ASK DIRECTLY.

3.  How do you create the best referrals?
There are two ways to create an environment that encourages spontaneous referrals.  First is to create what Tom Peters calls the WOW! Experience.  The second is by creating an effective, proactive referral system.  Either method on its own is very effective.  When the two are combined together it becomes a referral machine.

As I said, creating the WOW! Experience for your clients is a very personal thing.  It all revolves around creating a practice that people can’t believe.  The dentist that has an Italian café for a waiting room and has foot massages for clients during the exam.  Notice that neither had to do with dentistry per se.  People expect great service, WOW! goes beyond service and does the unexpected.  WOW! is a subject all on its own so won’t be covered in detail here.

However, creating a proactive referral system is something that I would like to explore briefly.  You have to make a spontaneous referral easy for your clients and the professionals you work with (see our white paper on CPA and attorney referrals).

How do you make it easy?

• Create a referral system and formalize it by naming it.  We use Friends Helping Friends™.
• Explain to your clients how the referral system works through brochures and in your newsletter.
• Remind them constantly in gentle, non-invasive ways that the program exists via your newsletter, posters, brochures, and letters.
• Reward them AND their referrals for taking action.
• Reward publicly to utilize the Principles of Influence Consensus and Scarcity.  By letting your clientele know in subtle yet public ways that other clients are referring and they are getting special things because of their referrals…the powers of INFLUENCE kick into over drive.

By providing both a WOW! Experience and a formal and elegant referral system you will be well on your way to a conveyer belt of new clients being hand delivered to your door.  Get busy!

Learn more about the “How to create the best referrals” Paper at TeamingWithClients.com

I’m always on the prowl for marketing techniques that are working for our clients. Those ideas may be new or maybe old with a new twist and sometimes even old and nearly forgotten as we’ve found lately.

It never ceases to amaze me how many successful people find something that works…AND THEN STOP DOING IT! (Yes, myself included). So let’s take a look at the top 6 trends in marketing in 2008:

6 Key factors to successful marketing in 2008

1. Having a Brand Matters
2. Know and dominate a niche within a niche
3. Integrate your marketing
4. It’s a lot easier with what you already have
5. Cold Calling Still works if…
6. Know the future of marketing and get there first

Having a brand matters – Being know by your target market is very important.

• Well known companies are 48% better at lead generation than “not very well known” companies. *
• 70% of firms say that they are not well known by their niche
• Contrary to common belief, traditional advertising like TV, radio and newspaper ads were ranked 33rd, 31st, and 29th out or 33 for effectiveness*

*”Future of Lead Generation” Benchmark report www.raintoday.com / leadgenerationreport.com

There are much better ways at reaching a target market that revolve around speaking to them directly.

Know and dominate your niche – You have to have a very clear picture of who and what you are going after. The shotgun approach of “I’ll get whatever I can,” will sentence you to mediocrity. You should have some basic research on them:

• Who are they? – age, income, hobbies, life’s experiences, etc.
• Who are the influence makers? – What are their trusted associations, organizations, etc. and who are the decision makers at those entities?
• What do they want? – What are their fears? What keeps them up at night?

If you cannot answer these questions in detail, you are going to have a problem marketing effectively

Integrate your marketing – Don’t just rely on one type of marketing. You should try to integrate several types into a cohesive strategy. The types of marketing that have proven most effective are (ranked by effectiveness):

• Referrals from clients
• Warm phone calls (to people that have received information from you)
• Seminars
• Referrals from professionals
• Newspaper ads
• Purchasing leads from lead companies

*Survey of Financial Advisors—Corona Research

It’s a lot easier to work with what you already have – It has been proven that it is over 14 times more profitable to attain new business from a current client than from a new client. Utilizing current client for referrals or new money is far easier than going after new people but sales people continue to make the mistake of ignoring the diamonds in their own backyard.

Cold Calling still works if you… — Cold calling has actually become more effective since the Do-Not-Call list made it unpopular. However, it has to have a purpose. The most effective purpose is to follow-up with a phone call on information that you have sent to someone. If you follow-up with a phone call within 72 hours of them receiving that information, you have an over 30% higher chance of setting an appointment.

Know the future of marketing – The future of marketing is NO MARKETING!
The future of marketing is finding ways to talk to the prospect one-on-one. People do not respond to marketing anymore. They do not want to be one of the masses. They want to be treated as a person. One of the best ways to accomplish this is through hand written notes.

Hey everyone!  Horsesmouth.com, which in my opinion should be one of the top resources of every financial adviser, had a great article about the power of handwritten notes by Jim Domanski.  It’s great to see so many top consultants like Jim Domanski and Sean Bailey are touting the handwritten note as both a client retention and referral generating tool.

Why should we worry about client retention? Man oh man, if you have to ask that question you need to pull your head out of the sand!!  Study after study has shown that less than 20% of an adviser’s clients are loyal!  That means only 20% are going to give you referrals, are going to give you more money or are not looking from something better.

80% of you clients are satisfied and that is dangerous!  Yes, you heard me, DANGEROUS!   I have always been told that you should have satisfied clients, but what I didn’t know was the mindset of satisfied clients.  Satisfied clients are simply biding their time until they find something better.  That means they are reading, listening and attending your competitor’s seminars and when they find something better, they are going to leave.

Thank God that 99.9% of our competitors don’t take much of an interest in their business or we could be in for some stormy times with our merely satisfied clients!  But that also opens up a huge opportunity!  What is it?

Over 80% of our competitor’s clients are also merely satisfied.  That means if their clients find something better, they will leave.  Our best prospect is our competitor’s best clients and they are ripe for the picking.  We just have to give their clients something that would cause them to think that we were “something better.”  What is that?

We have all experienced the onslaught of junk mail, but is direct mail dead?  Dead?  No.  Ailing?  Maybe.

Still according to the Direct Marketing Association, each $1 spent on Direct Mail made on average $11.65.  Now there’s the catch…”on average.”  That means some people’s Direct Mail made them nothing and others made them $30 per $1 dollar spent.

What makes direct mail successful?

1. I know Mr. Spok from Star Trek is going to turn in his grave but writing emotionally instead of logically will make your Direct Mail more successful.  Too many advisers write their direct mail pieces logically.  We all know people buy emotionally and then validate the purchase with logic.  It is no different with Direct Mail.
2. Make sure it has a call to action!  If you don’t ask, you don’t get.  You should absolutely have some nice personal touches like holiday and birthday cards but you also need to ask them to call or contact you.  No Direct Mail piece is complete with out a call to action.
3. The absolute best results always occur when the Direct Mail piece is personalized.  The best way to personalize a piece is to handwrite a note to them using their name.

We have seen a typical response rate of over 10% with a direct mail piece that contains all 3 items above.  We have advisers that have received 52%, 25%, 12%, 18% on individual mailings.

Is Direct Mail dead?  Only if you mail out tired, old financial newsletters and such.  Be smart and be rich.

There are hundreds of referral systems out there. All of them revolve around asking for referrals…ASKING FOR REFERRALS DOESN’T WORK!

Not because people won’t give them to you (most won’t…I know I don’t give referrals when asked.) The real reason they don’t work is nobody asks for them, I know I won’t. It is way too uncomfortable for me and the client.

Some of the industry’s top advisors receive more than 100 referrals a year…but they don’t ask for them. The referrals they receive are given freely by their clients and the professionals they work with. How?

To a one, when asked, they credit it to the relationship they have created with their clients or referring professionals. The clients just feel the urge to constantly tell people how great they are because they don’t like their adviser…they love him or her. They rant about them. They brag about them. They want to introduce them to everyone they know!

I know all of our clients like us or they wouldn’t be working with us, but how many of our clients love us so much they feel the need to tell everyone about us as some people may do about a fantastic new restaurant they’ve tried or movie they’ve seen?

I think most advisers would find those kind of clients quite rare and yet some advisers have legions of those people. How did they create these raving fans?

Study after study, research after research has shown that the one thing that creates raving fans is contact…not contact about financial matters but contact on how much you care. To create raving clients and referrals you need to contact people 2 or 3 times a month.

You may be thinking, “Are you crazy! 2 or 3 times a month? They don’t want to be contacted 2 or 3 times a month!”

You are right and wrong.

Right, they don’t want you calling and bugging them about their money 2 or 3 times a month.

Wrong, they love to be contacted on a personal basis two or three times a month. What do I mean about personal. Simply think about how you do it with friends and family…after all, don’t you want them to consider you as part of their circle of friends and family?

Here are some ideas for those of you that don’t have friends and family and therefore don’t understand how those of us that do, find so many:

• An emailed joke, funny story or weird news story
• A phone call just to say hi
• Handwritten birthday cards, holiday cards and anniversary cards
• A client party—PARTY…fun only! No business mentioned
• A client outing to a minor league baseball game or gardening center
• A client focus group asking for their opinions
• A call after a big storm checking in with them to make sure they are all right
• Etc. etc. etc.

If you do these types of things, you will have more referrals then you ever dreamed of without asking once.

Understanding the handwritten note  as a marketing and direct mail tool is the first step to using them effectively in your business.  Instead of just jotting a note and mailing it to a client or prospect (which is better than 99.9% of other professionals that don’t bother), why not put together a strategic, coordinated marketing plan leveraging their marketing power?

Why Should you send handwritten notes?

People buy from people they know like and trust.

Unfortunately, the 3,000 or so marketing messages that the average American gets hit with everyday has dehumanized the consumer.  They are treated as just one of the masses.  Your message is no louder, no brighter and no better than your competitors unless you do something special.

To build the credibility necessary for someone to turn over their life’s savings to you takes time.  Unless you have a fortune 500 brand it’s unlikely your prospects have heard of you before they hear from you the first time.

Numerous direct marketing studies have shown it takes 7 or more exposures of a marketing message before a consumer makes a decision to buy. (Exposure means that the message has been seen and read.  If you send a mass mailer piece or form letter that is trashed and not read, that does not count as an exposure.)

What’s happening during those 7 exposures?  They are building credibility, authority, likability and consistency.  4 of the 6 Principles of Influence Dr. Cialdini talks about in his ground breaking research on how people are affected by influence.

It’s not rocket science, but it’s a key concept that many advisers miss.  You’re are extremely smart for utilizing the handwritten method to increase the effectiveness of your marketing.

But who has time for writing handwritten notes?  I spent 6 hours a week writing handwritten notes when I was making over a $1 million a year in my financial planning practice.  Why 6 hours?  Because that’s how I built the $1 million a year income!  But I know few people would be able to put that kind of time aside which is why I’m so excited about all the fantastic auto handwriting technology to you like that being offered by Quantum Enterprises.