Client Satisfaction Up 18%: Revamped Service Model and Communication

Client Satisfaction Up 18%: Revamped Service Model and Communication

Executive Summary

Santos Financial, a growing RIA managing over $350 million in assets, faced increasing client feedback indicating a need for more proactive communication and a more personalized service model. To address this, Santos Financial partnered with Golden Door Asset to redesign their service model, incorporating regular check-in calls, personalized financial planning updates, and proactive communication about market events. This revamped strategy resulted in an 18% increase in overall client satisfaction, leading to increased client referrals and accelerated AUM growth.

The Challenge

Santos Financial experienced significant growth over the past five years, expanding their client base by 40%. However, this rapid expansion led to a decline in perceived client service. While advisors were technically fulfilling their duties, client feedback, gathered through post-meeting surveys and annual reviews, consistently indicated a desire for more personalized attention and proactive communication.

Specifically, clients expressed concerns about the following:

• Lack of proactive communication: Many clients felt they only heard from their advisor during scheduled meetings or when initiating contact themselves. One client, Mr. and Mrs. Thompson, managing a $1.2 million portfolio with Santos Financial for their retirement, stated they felt "out of the loop" regarding market fluctuations and their potential impact on their financial goals.
• Generic financial planning updates: Clients perceived the quarterly performance reports and market updates as generic and not tailored to their individual financial circumstances or risk tolerance. A survey revealed that 65% of clients felt the reports lacked personalized insights relevant to their specific financial goals, such as funding college for grandchildren or planning for long-term care.
• Inadequate explanation of market events: During periods of market volatility, clients reported feeling anxious and unsure about the potential impact on their investments. They expressed a need for clearer explanations and proactive guidance from their advisors. One client, a business owner with a $750,000 portfolio, expressed frustration that during a recent market downturn, he received no communication from his advisor until after he initiated contact.
• Missed opportunities for value-added services: Because communication was infrequent and reactive, advisors were missing opportunities to offer value-added services like tax-loss harvesting, estate planning reviews, and insurance needs assessments. This led to lower client retention in the long run, and a lower adoption rate of higher margin services.

These issues translated to a stagnating net promoter score (NPS) of 35, indicating a significant opportunity for improvement. The firm understood that if they did not address these concerns, they risked losing clients to competitors who offered a more personalized and proactive service experience. The average client AUM was $875,000, making client retention paramount to Santos Financial's continued success.

The Approach

To address the challenges, Santos Financial implemented a three-pronged approach:

1. Redesigning the Service Model: Santos Financial moved from a reactive, event-driven service model to a proactive, relationship-focused approach. This involved segmenting clients based on AUM and complexity of their financial needs, and tailoring the frequency and type of communication accordingly. For example, clients with over $1 million in AUM received monthly check-in calls, while clients with less than $250,000 received quarterly updates.

2. Implementing a Client Communication Calendar: A structured client communication calendar was developed to ensure consistent and timely communication with clients. This calendar outlined specific communication touchpoints throughout the year, including:

   • Monthly Market Updates: Brief email updates summarizing key market events and their potential impact on client portfolios.
   • Quarterly Performance Reviews: Personalized reports detailing portfolio performance, asset allocation, and progress toward financial goals. These were supplemented by scheduled phone calls or virtual meetings.
   • Annual Financial Planning Reviews: Comprehensive reviews of clients' financial plans, including adjustments to investment strategies, retirement projections, and estate planning considerations.
   • Proactive Communication During Market Volatility: Immediate communication to clients during significant market events, providing context, reassurance, and guidance. This involved using personalized video messages explaining how the events were affecting their individual portfolios.
   • Personalized Birthday and Holiday Greetings: Small gestures to show clients they are valued.

3. Advisor Training on Effective Communication: Recognizing that effective communication is crucial for building strong client relationships, Santos Financial invested in advisor training programs focused on:

   • Active Listening Skills: Learning to truly understand clients' needs, concerns, and goals.
   • Empathy and Emotional Intelligence: Recognizing and responding to clients' emotions in a sensitive and supportive manner.
   • Clear and Concise Communication: Explaining complex financial concepts in a way that clients can easily understand.
   • Proactive Problem Solving: Identifying potential issues and addressing them proactively before they escalate.

Golden Door Asset played a crucial role in facilitating this transformation by providing the tools and technology necessary to automate and personalize client communication. This involved integrating the firm's CRM system with Golden Door Asset's AI-powered platform to create a seamless communication workflow.

Technical Implementation

The successful implementation of the revamped service model relied heavily on leveraging technology to streamline processes and personalize client communication. Key technical implementations included:

1. CRM Integration: Santos Financial integrated their existing CRM (Salesforce) with Golden Door Asset's platform. This integration allowed advisors to access client data, communication history, and financial planning information directly from the platform. This enabled personalized communication and ensured that advisors were always up-to-date on clients' individual circumstances.
2. Email Marketing Automation: Golden Door Asset's platform was used to automate email marketing campaigns, sending personalized market updates, performance reports, and educational content to clients. The platform's segmentation capabilities allowed advisors to target specific client groups with tailored messaging based on their AUM, risk tolerance, and financial goals. The system employed A/B testing on subject lines and content to optimize email open and click-through rates.
3. Client Communication Calendar Management: The platform facilitated the creation and management of a client communication calendar, ensuring that all communication touchpoints were scheduled and tracked. The platform sent reminders to advisors about upcoming client meetings and communication deadlines, helping them stay organized and proactive. Integration with calendar software, such as Outlook and Google Calendar, streamlined the scheduling process.
4. Personalized Video Messaging: Golden Door Asset's platform enabled advisors to create personalized video messages for clients, which were used for market updates, performance reviews, and proactive communication during market volatility. The platform's video recording and editing tools made it easy for advisors to create high-quality videos quickly and efficiently. Video messages were sent through a secure link, ensuring client data remained protected. Usage of video messages was closely tracked, with advisors incentivized to regularly incorporate them.
5. Data Analytics and Reporting: Golden Door Asset's platform provided data analytics and reporting capabilities to track the effectiveness of the revamped service model. Key metrics tracked included client satisfaction scores, email open and click-through rates, client engagement levels, and AUM growth. This data allowed Santos Financial to continuously monitor and optimize their communication strategies. Sentiment analysis of client feedback from surveys and emails was used to further refine messaging.
6. Secure Client Portal: Implementation of a secure client portal to provide 24/7 access to portfolio information, financial plans, and communication history. The portal was integrated with the CRM system to ensure that all client data was up-to-date and accurate. Multi-factor authentication was implemented to protect client data.

Results & ROI

The implementation of the revamped service model and communication strategy at Santos Financial yielded significant positive results:

• Client Satisfaction Increase: Overall client satisfaction, as measured by the firm's annual client satisfaction survey, increased by 18% within the first year of implementation. The NPS score increased from 35 to 58.
• Client Referrals: The number of client referrals increased by 25% compared to the previous year. The improved client experience led to more word-of-mouth marketing and a stronger referral network.
• AUM Growth: AUM grew by 12% in the first year following the implementation, compared to 7% in the previous year. This accelerated growth was attributed to increased client retention and new client acquisition. Specifically, client retention rates rose from 92% to 96%.
• Improved Client Engagement: Email open and click-through rates increased by 30% and 15%, respectively, indicating higher client engagement with the firm's communications. The use of personalized video messages resulted in even higher engagement rates, with an average view time of 80% of the video length.
• Increased Adoption of Value-Added Services: The proactive communication strategy led to a 40% increase in client adoption of value-added services such as tax-loss harvesting and estate planning reviews, generating additional revenue for the firm.

Specifically:

• AUM attributable to referrals in the past year: $12 million.
• Average client lifetime value increased by 15%.
• Cost of client acquisition decreased by 10%.

Key Takeaways

The Santos Financial case study offers several key takeaways for other RIAs and wealth managers:

1. Proactive communication is crucial for building strong client relationships. Clients value personalized attention and appreciate receiving regular updates on their financial plans and market events.
2. Technology can be leveraged to automate and personalize client communication. By integrating CRM systems with AI-powered platforms, firms can streamline processes and deliver tailored messaging to clients at scale.
3. Advisor training is essential for effective communication. Investing in advisor training programs focused on active listening, empathy, and clear communication can significantly improve client satisfaction and retention.
4. Data analytics can be used to track the effectiveness of communication strategies. Monitoring key metrics such as client satisfaction scores and email engagement rates can help firms continuously optimize their communication efforts.
5. A structured service model, tailored to client needs, leads to increased client loyalty and AUM growth. Prioritizing client service as a strategic imperative will contribute to sustainable business success.

About Golden Door Asset

Golden Door Asset builds AI-powered intelligence tools for RIAs. Our platform helps advisors automate personalized communication, enhance client engagement, and increase AUM. Visit our tools to see how we can help your practice.