View more on these topics

Loyal Approval

Short-termism is an accusation that has long been levelled at the British

way of doing business. But things move on. Supermarket loyalty cards have

been introduced and brands have been formulated that insinuate themselves

into the very fabric of the consumer&#39s life.

In short, initiatives for holding on to customers and developing long-term

relationships have become the norm and this applies to IFAs as much as any

other business.

Alongside this, what needs to be taken into account is the recent changes

to the environment in which IFAs are operating. With the increasing

regulatory and media scrutiny on up-front commission comes its gradual

erosion in favour of trail commission or fees. Correspondingly, the focus

of the interaction between IFA and client moves away from the initial

moment of selling and on to the long-term relationship.

If IFAs agree on the importance of ensuring business over the longer term,

the app-roaches they take to achieve this differ.

Berkeley Independent head of marketing Sally Reeves says one of the things

IFAs will have to do is sell advice actively and to convince clients of the

added value that an independent adviser can bring.

Reeves says many network members have service agreements with clients,

usually paid for on a quarterly basis. As part of these agreements, they

get, for example, monthly updates, newsletters and invites to corporate

events.

Reeves says: “Dozens of people are marketing the same products, so we need

to see if there is some extra benefit we can offer to build the

relationship with the client and pass any benefit on down the line.”

She says the networks are best placed to do this with their bargaining

power to secure the best rates from providers. These are often deals that

the customer would not get by going direct.

Reeves says many advisers recognise that clients might want to go direct

for some products and some advisers will try to acknowledge and accommodate this by allowing this to take place through their own websites. But where there

is a need for face-toface advice, she thinks this should be holistic.

An important element in maintaining customers is having good admin. Reeves

says: “When I hear IFAs say that they have 2,000 clients on their books, I

laugh. How can you possible service them properly?”

Other than tailoring the amount of clients you have to the admin support

that you can offer, Reeves also suggests that clients should be introduced

to paraplanners and other admin staff so that they have a familiar face to

go to with routine enquiries that might not require the attention of IFAs.

Applewoods Associates head of marketing Claire Rob-erts says maintaining

existing customers is more important than attracting new clients.

She feels that the two are interlinked in any case as most new clients

come as a result of recommendations from satisfied existing customers.

Applewood Associates has a two-pronged approach to maintaining customer

loyalty. On the one hand, it offers “jollies” in the traditional sense such

as investment seminars to which existing clients are invited. These are

then combined with a day of golf or meals arranged by the firm.

On the other hand, clients receive a bimonthly in-house magazine and

mailshots. Every three months or so, clients are also contacted to see if

they are happy with things and feedback is invited.

Newsletters are a popular way of keeping in contact with clients. The

Financial Planning Service principal Julian Crooks also sends out regular

newsletters, partly because he believes his clients are likely to get them

from other IFAs. “If you do not keep on reminding your clients who you are,

you risk losing them,” he says.

Crooks buys a pre-printed package but sends this out with a covering

letter on the issues which he feels are topical. He sees himself as acting

as a filter, dealing with the news stories, and often scare stories, that

clients may have read and weeding out the wheat from the chaff.

But above all, Crooks thinks the traditional qualities of giving a good

service and making sure you do your job well are the primary ways of

ensuring long-term business.

At present, the consumer debate is primarily focused at the level of

comparing channels and, given the debate over the polarisation review, this

is perhaps inevitable.

But once the dust has settled, some think the consumer debate might become

more finely tuned.

Rather than arguing over the merits of going to see an IFA over buying

direct, perhaps the performance of individual IFAs could be compared.

Imagine an FSA performance table for IFAs.

Crooks, who is one of the few advisers who are Certified Financial

Planners and whose business is predominantly fee-based, says: “I always

introduce the subject of commission and make it clear what people are

getting for their money. IFAs who are not transparent with consumers will

risk a consumer backlash.”

John Stones

Recommended

Britannia follows base rate cut with 5.14% fixed deal

Britannia, the UK&#39s second-biggest building society, is offering a newfixed-rate mortgage for first-time buyers and remortgages. The loan is fixed at 5.14 per cent for two years up to 75 per cent loan tovalue and at 5.34 per cent up to 95 per cent LTV. After the fixed period, the loan reverts to Britannia&#39s variable […]

Hedge trimmed from the top down

Odey Asset Management has introduced the Odey Latham global fund, anoffshore Oeic that uses hedging techniques. The fund aims to provide high returns with low volatility whatever theconditions of the stockmarket by applying long and short hedging techniquesto stock selection. Fund manager Mark Latham goes short by selling stockshe thinks are overvalued and long by […]

&#39Treasury must recognise IFA role&#39

Aifa wants the Treasury to recognise that IFAs are at the “sharp end ofascertaining and meeting the financial needs of individuals” as part of itsresponse to the consultation paper, Savings and Assets for All, includingthe Government&#39s baby bond or children&#39s trust fund. Aifa highlights theneed for people to get advice on the CTFs but says […]

Our view of the retail review

One promise to readers from the editor and staff at Money Marketing – atno point in this process will we censor or compromise our coverage of thereview process in order to gain the dubious distinction of getting to astory first. If we have to print an article a week after some of our moredove-like competitors, […]

Japan Economic Insight

James Dowey, Chief Economist, and Paul Caruana-Galizia, Economist

The conventional wisdom is that following a roughly 50 per cent rise in the stock market in 2013 in Yen terms, the Japan trade is over and done*. So the story goes, those big gains were due to a one-off boost from quantitative easing (QE) and a depreciation of the Yen — policies that one should think of as a palliative to Japan’s economic weakness, but not a cure. Rather the cure, and by implication the necessary condition for a longer-term investment case, is deep structural reforms — a painstaking re-weaving of Japan’s economic and social fabric, no less. The story continues: this is a much tougher test than launching a blast of QE, and one that prime minister Shinzo Abe, although well intentioned and well supported by the public thus far, is likely to fail. Stick a fork in Japan, it’s done…continue reading

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com