Thinking big is not necessarily about thinking big.
In fact, thinking big is about small slices, according to Maribeth Kuzmeski, who is familiar to many InsuranceNewsNet readers for her numerous speaking engagements and the seven books she has written on marketing. Not only has she worked with many financial advisors, but she became licensed as an advisor herself just so she could help her fellow advisors market themselves.
She has seen what scales, and it is not by going wide. It is by focusing on niches, where reputations spread quickly and experts excel.
Many advisors know Maribeth through her Red Zone Marketing concepts, which she developed from her lifelong love of football. But the game she is talking about here is more like chess, where a player has to think many moves down the board.
In this interview with Publisher Paul Feldman, Maribeth discusses how good businesses can grow to be great by making deep connections with clients.
FELDMAN: What would you tell financial advisors who want to think big and 10X their business? How would they go from six figures to seven or from seven figures to eight?
KUZMESKI: In this environment in 2017, there is a real attack on the value of financial advisors.
The attack is coming from the government that thinks it needs to regulate the advisors’ ability to be in the best interests of the clients. The attack comes from inside and outside the industry. The media talk negatively about the fees and value of financial advisors.
If we don’t change the conversation and start to message our value better, we don’t really have any value. And defining that value isn’t like having a silly value proposition. It’s having something that somebody can remember, talk about and share with somebody else.
Most of financial advisors’ business still comes from referrals — from other people talking about how great you are. But if people don’t know what to say or if they start believing some of these negative messages about financial advisors, we’re really in a lot of trouble.
We have to be stronger with our message. We might have done a value proposition before, but it was probably something that was very cleansed and it sounded like we work with everyone because we can. We have to speak to specific markets about the specific things that we do. And there’s a whole formula that we’ve proven really works for developing a value proposition.
It is an overview statement. It’s even a graphic of what that value proposition looks like. People are visual today. We can’t throw a bunch of words at them and think they’re going to remember it.
People don’t necessarily like to do a lot of digging and finding things. They like to see things at a glance — here are the three things that we do.
FELDMAN: Can you give us some examples of advisors’ three statements on value?
KUZMESKI: Absolutely. We have an advisor who primarily does investments. He talks about investing redefined and planning for life-changing outcomes.
First he says to prospects and clients, “Let me share the three things that we do,” and draws three circles like a Venn diagram. This isn’t something that’s pre-printed in some slicked-up marketing brochure that lets people know he’s trying to sell them something. This is something he is actually drawing out on a white board or on a piece of paper for the prospect or the client.
And he says, “The first thing we do is outcome-based planning,” and he writes “outcome-based planning” in the center of the first circle. Then he explains what he does as it relates to outcome-based planning, proving why this should be something clients would pay for. So he’s writing down words like “integration” and “risk management” and “goals.”
Then he actually gives it a number. He says, “The value of what we do under outcome-based planning is worth about 1 percent of your assets.”
Then he says, “The second thing we do is investment management,” as he writes that in the second circle. And then he goes through the things that he and his firm do on investment management. So he is peeling the onion and sharing a little bit more information, talking about the institutional research that they do.
After that, he says, “The third thing that we do, and really what we bring, is Team Alpha.” He talks about the credentials of each person on this team. He puts it not in terms of years, but more in terms of what they have learned.
Then he talks about studies on the value of an advisor. You can really prove out that the value of an advisor is worth 3 and 4 percent. So he says, “What we do altogether is worth far more than 3 percent, but we certainly don’t charge 3 percent. Our average fee is 1.2 percent.”
Finally, he asks, “Do you have any questions about our value?” The people on the other side of the table always say no because of how he’s explained it.
Not only is this a great referral tool, it’s also a great closing tool.
FELDMAN: It’s a dynamite way of explaining it and it’s easy for the client to grasp before you start getting into more complex things.
KUZMESKI: People remember things in threes. However, we do have some clients who will talk about things in fours, in quadrants. Clients actually can understand it. They can get it. And they can walk away with more clarity on what this financial advisor actually does.
FELDMAN: Knowing who you are is the first step. What’s another step that you would need to take to be a 10X advisor?
KUZMESKI: We have taken advisors to 10X many, many times and the reason that it has worked is because they had a strong foundation. They really understand who they are, what they do, and then they are able to clarify it and explain it.
But on top of that is having a niche. Because the word will travel a lot faster inside of a niche. Of the most successful advisors we work with, almost all of them have at least one, if not two, three and four niches.
The problem today is that we have an attention deficit disorder society where nobody is paying attention to anything unless it relates directly to them. So when it does relate directly to them, all of a sudden their ears perk up and they listen. That’s why niches work.
We have a client in California who works with people who are getting ready to retire from the aerospace industry. It’s a very specific marketplace, but once you get one client, it becomes a lot easier to get more and start to get the word to spread.
And all of a sudden you’re not working very hard to bring in the new business. You’re working hard to serve the new business.
FELDMAN: What are some characteristics of the person with a 10X mindset?
KUZMESKI: It is somebody who is willing to take a risk. There are advisors who are willing to do that and there are a lot of advisors who are not necessarily that excited about trying something new. Those are not the 10Xers.
FELDMAN: What are some of the types of things you see these 10Xers doing?
KUZMESKI: Seminars are still working. They don’t work like they did before, but they still work. And I think the reason they don’t work like they did before — when you sent out an invitation and got a hundred people to show up — is because people aren’t paying attention to anything anymore.
So we’re not capturing their attention with good messaging. When we have good messaging on a seminar invitation, we can capture the people’s attention. Especially if it’s niche marketing or focused on where you’re really speaking to people, they will come.
For example, you could target somebody who is getting ready to retire from a specific company. And you can say this is an event just for people who are getting ready to retire from XYZ Company and then you talk about all the things that you’re going to present.
There are all sorts of complexity that happen once you move into that retirement zone.
We have advisors who are using Linked-In and social media to be able to effectively target niche markets and they’re successful doing it.
FELDMAN: We have a speaker at the Super Conference who is going to be talking about how you can generate one lead per day for free on LinkedIn.
KUZMESKI: It’s true, depending on your market. If your market is retirees, that wouldn’t work. But working people put it all on LinkedIn. And we can gain a lot from LinkedIn searches
. We have one client who is focused on a really small niche. Through LinkedIn, they found more than 200 people who actually fit into that niche reasonably in their location.
When you have a list of 200 people that you focus your marketing on, you can get much better results. So rather than sending them a postcard, you can send them a $15 package because you have only 200 to send to. And that’s going to blow their socks off.
FELDMAN: So let’s talk about messaging. What is some messaging that you’re seeing that’s most effective today and how has that changed over the past five or 10 years?
KUZMESKI: Unfortunately, it hasn’t changed nearly as much as it should. But there is something advisors don’t really like to do, but it’s incredibly effective — tell your story.
Statistics show that 80 percent of the reason that someone chooses to do business with a financial advisor is because of the advisor. It’s not because of the name on the door. It’s not because of the products they sell. It’s because of the way they feel about that advisor.
And since that’s the case, we must do a better job at telling our story and letting people know a little bit about us before they come in to see us.
Nine out of 10 people are going to Google you before they come in to see you. And if they have more than a million dollars, it’s 10 out of 10. They’re all going to do it. It’s not like I need to hire a private investigator. I’m just going to lean over and punch your name in my laptop or my phone, where 80 percent of the searches happen, and see what happens. When I do that, I’m going to find something about you.
Now, I’m looking for you because I’ve heard something about you. Because you have a reputation or your client has told me how great you are or something like that.
So, I’m going to do this search and see if this financial advisor may be someone I’d like to work with. And when I do that online search, what we find is that the online reputation supersedes the regular reputation.
If somebody goes online and they find the advisor’s website doesn’t look like it’s been updated in 10 years, that’s not attractive today.
In fact, people don’t actually want to go meet with the financial advisor. They know they should. They know they need to. They’re looking for an out and a lot of advisors’ online reputations give people the out. You’re still getting the referrals. People love you. They know how good you are. But somebody comes and they look at you online and maybe it’s really not all that great and you think maybe this guy is getting ready to retire. I don’t even know what’s going on here. And then they decide not to reach out and contact you.
All of the good work should not come down to what a LinkedIn profile looks like, but people are looking for an out and we can’t give it to them. So how do we give them the in?
How do we say this is someone you need to come and meet with? And the way to do that is to warm up your messages. There are some advisors who will really do that and tell a warm, personal story. But warm up a little bit beyond “I’m a financial advisor, I’ve won a bunch of awards and you should come in and see me.”
That actually makes me think I’m probably going to get judged. This is probably not going to be a very good thing to come in to see this advisor.
We always ask advisors to do this on their LinkedIn profile — answer the question “Why are you in this business?” Because it probably comes down to the meaning this business has for you, the good work that you’ve been able to facilitate by being a financial advisor.
Talk about your story. Why is this industry important to you? Why is this business important to you? How did you get into this business? And if that’s in the first paragraph of your LinkedIn profile or the summary section of your LinkedIn, then that’s really going to warm them up a little bit. It’s going to make them think, “Maybe I should come in and meet with this person.”
FELDMAN: That’s really powerful. What are some ways of fixing your online presence?
KUZMESKI: Well, there are some really easy things that can be done. We think this must be a daunting task and this will cost a whole bunch of money. But it doesn’t have to.
I would start with taking a look at your LinkedIn profile and making sure that at least it’s filled out. You have a picture there. And then you have a good summary section, which falls right below your picture and your title, but tells a little bit of your story. That really answers the question of why you are in this business.
The second thing that I would do is take a look at your website. If you haven’t updated it lately, there are a lot of new templates available to help you do that. Simply changing the template can make a big difference in how that website looks. If the website looks like it was created in this century, that would be a really good thing.
There are some websites that are absolutely terrible. And it’s not because they were terrible when they were put up. They look terrible now because there are so much better templates available.
The other thing is, I would cut out about 90 percent of the content you have on your website, which isn’t hard to do. You take out all the fluff and paragraph after paragraph talking about financial planning services.
Instead, throw a graphic up there. Graphics can be created in PowerPoint. It doesn’t cost you anything. Put a graphic up there and show your process as opposed to telling the process. Because as I mentioned before, people really don’t read anymore and they don’t want to read. They want to see things at a glance.
You would think that if somebody is getting ready to invest their life savings with you, wouldn’t they would want to read something about you? But that’s actually not the case.
They won’t even watch a video that’s more than a minute and a half long. And that’s how they’re going to decide whether they’re going to invest their money with somebody.
FELDMAN: A lot of the advisor websites are “me-centric.” It’s about them and what they do rather than what they provide for the client.
KUZMESKI: That’s exactly right. And that’s why if you’re working with niches, you can talk about the work you do specifically for a certain type of person. Then the prospect feels when they’re viewing this, that this is actually talking to them, as opposed to “we do all these great things and have all these certifications.”
It’s really sharing the specific things that you do in a way they can remember. It’s going to have an impact on them as opposed to spelling out a laundry list of features and stuff that the advisor does but no one really can remember.
FELDMAN: Can you give me an example of somebody who you’ve worked with who has really turned it around and has taken their business to an extreme level of success?
KUZMESKI: I actually worked with many advisors along these same lines, but I’ll share with you the very first financial advisor we ever worked with.
That advisor had $10 million of assets under management. And if you think about it, that’s not a lot. In fact, he really couldn’t afford to pay me. He needed something to be able to get his business going. So we’re talking about basically working from ground zero.
I came in and I put a marketing plan together. He really didn’t think it was going to work. So he suggested instead of paying me to implement this, he would pay me on performance. I would get paid only on what actually comes in.
So I actually had to get licensed because I was sharing commissions. I got a Series 6, 63, 65 and health insurance license so that we could do this.
We found three niches that we were going to focus on with super-low-cost marketing because he didn’t have any money.
And within five years he went from $10 million to more than $200 million in money management and kept it growing from there.
He wasn’t the smartest advisor. But he had a lot of really great skills. He was able to connect with his clients and, once he got the clients, we just started to work those niches.
We would have eight people come to a seminar — eight people who were getting ready to retire from a company — and he would get them all as clients. And then we’d have another seminar the following week and have five to 10 people come and he would get them as clients because he was speaking to a particular target market.
He wasn’t serving big dinners and all of that. We were serving them Chex Mix and some drinks — and not alcoholic drinks. And they were still coming because they wanted the information.
That’s how powerful a niche can be. And then we took that one niche and we actually created three separate niches, and that is the way that it works. We’ve seen advisors be able to go to the next level by doing that.
FELDMAN: What are some other ways of elevating business?
KUZMESKI: If we look at where 10X growth comes from, it is often from strategic alliance relationships. An average strategic alliance relationship is worth $11 million in new assets year in and year out. So it’s big. It’s big and it can be a lot bigger than that.
I know a lot of advisors have tried doing these relationships and they can be disappointing. But we have done a lot of research on why it doesn’t work and what we can do to fix it.
And we have seen incredible growth. All you need is one accountant or one divorce lawyer or one estate planning lawyer who will refer business to you and you create this stream and it’s amazing.
FELDMAN: What are some ways of establishing the strategic alliance?
KUZMESKI: We looked at what advisors are doing wrong and we found a few things. One of them is before you meet with somebody, it might seem like they’re going to be great because you have a client in common or you see that they have a big business and they have all these people they can refer to you.
But I would ask them if they are growing their business. Because if they’re not actively out there growing their business, they have a very limited amount of space to have this conversation about this financial advisor they just had lunch with.
They’re not going to call their client of 20 years and say, “You know, I just met with this guy for lunch and so I think you should talk to him.”
The conversation doesn’t come up. That phone call doesn’t get made, and it’s just, “Hey, the guy’s great,” but they don’t actually take the steps to refer.
If it’s a growing entity, we have found, then they have the opportunity to talk about it. Which means you’ll probably have to look at younger partners in law firms and accounting firms. Those are the ones that seem to generate the most business today.
The second thing that you have to ask is where they are getting their new business. The answer to that question can be a deal killer because if they say they get some business from Merrill Lynch or somewhere like that, that means that they’re getting all of their new business from your competitors.
If they’re getting all of their new business from your competitors, there’s no way they’re going to turn around and give it to you. They can’t.
It has been proven out that 99 percent of strategic alliance relationships fail because the advisor refers business but the other professional doesn’t refer business back. That’s because in a lot of cases they can’t.
Or they’re not the referring type. But I think we can control that better than we can control the fact that if they’re getting their new business from somebody else there’s not even an opportunity.
FELDMAN: Those seem like logical questions to ask and I can see how they get missed frequently.
KUZMESKI: So, many of these relationships fail. And advisors don’t even want to hear about it anymore because they say, “I know, I tried that.”
But very rarely has someone told them what they could do differently to make it work better as opposed to “Well, just send them some baskets at tax time and you’ll get all this new business.” It just doesn’t work like that.