Blog > Firm Growth > Client Engagement Strategies for Financial Advisors

Client Engagement Strategies for Financial Advisors

What does it take for advisory firms to reach hyper-growth, catapulting themselves to new levels of business success? 

There are an incredible number of strategies, tactics, and opinions on how to best grow your business, but we want to draw your attention to one simple, practical way to ensure that your growth strategy is always evergreen: Focus on your client engagement strategies. 

If you want to become a hyper-growth advisory firm, there is no better way than to purposefully and consistently engage with existing clients. In the 2023 Nitrogen Growth Survey, we discovered a few key findings about what high-growth advisory firms do differently than slow-growth firms — and, perhaps unsurprisingly, they come back to solid client communication principles. 

Firms classified as hyper-growth:

  • Incorporate more automated communications into their practice, ensuring that they frequently show up and add value to different segments of clients with targeted, valuable content.
  • Feel more prepared for the Generational Wealth Transfer than slow-growth firms do, also due in part to having more advanced client communication techniques.
  • Implement proposal generation software and lead-conversion tools that better equip them to convert leads into meetings, meetings into clients, and clients into referral champions with defined processes running flawlessly through their technology systems.

Throughout the rest of this article, we’ll dive deeper into effective client engagement strategies that you can implement in your firm, as well as identify the role of technology in a digital engagement strategy.

Table of Contents

  • 8 Effective Strategies to Increase Client Engagement
  • How to Automate Your Client Engagement
  • How to Build a Client Engagement Strategy with Nitrogen’s Risk Number
  • Connecting Client Engagement Strategies to Ongoing Portfolio Management
  • What the 2023 Nitrogen Advisor Growth Survey Reveals About Client Engagement



8 Effective Strategies to Increase Client Engagement

The path to hyper-growth begins with understanding how to increase client engagement. To that end, identify how many of these eight types of client engagement your firm is (or isn’t) already using – and then implement any tactics that you aren’t effectively doing already.

1. Timely communication

Look first at how often you’re communicating with your clients as a whole. This doesn’t mean how many review meetings you hold each year – but rather, the totality of communication. 

If you aren’t communicating timely, relevant information to clients at least monthly, then this is the first place to start when attempting to increase client engagement.

2. Regular meetings

Your actual meeting cadence will vary depending on the services you offer, the complexity of the clients you work with, and what’s occurring in the world that’s impacting investments. However, it’s generally accepted that personal meetings with most clients should occur 2-3 times per year – and annually, at the bare minimum.

3. Managing expectations through risk

Getting clients engaged in their investment performance, especially if they are naturally delegators, can be a balancing act for even the best financial professional. But managing expectations and communicating why it’s important to stay the course during turbulent conditions is essential for keeping clients engaged. 

One of the most effective ways to manage expectations is by helping clients to understand their personal level of risk tolerance and then using that knowledge as a recurring conversation point to build trust in both an advisor and the agreed-upon plan.

4. Personalizing the client experience

There is constant talk about personalization within the financial advice profession, and research about client preferences backs up the need to build communication plans that are as highly targeted as possible. 

Importantly, personalization doesn’t mean “basic” tactics like using an email platform to auto-generate first names. Instead, clients want their advisors to anticipate what’s important to them and engage with them about those personal situations.

5. Being empathetic

Empathy is a critical element in building trust and connection with clients, and advisors who master the implementation of a holistic, empathetic approach to client relationships give themselves a pathway to long-term engagement and retention success.

Empathy is not just about active listening; it’s also about the actions taken after a client has indicated what they need and how you can help them. Follow-through is the most important part of cultivating relationships.

6. Financial education

Financial education not only draws prospects to a firm, it helps to retain clients over time with relevant information. That principle can be seen best in the Great Wealth Transfer taking place as assets change hands from older to younger generations. By putting a focus on engaging with the next generation through education, advisors can attempt to keep more of the estimated 70% of wealth that leaves a firm after one generation.

7. Targeted campaigns to niche groups

Often, advisors think of targeting marketing campaigns only as a way to reach new prospects. However, targeted marketing campaigns to internal groups – like different segments of clients – are just as important to the growth and longevity of a firm as attracting new business.

8. Expand the services you offer

As a firm offers more services, it gives itself additional opportunities to engage with and talk to its current clients. For example: If you’re a firm that began with investment management and financial planning, adding tax planning can be a way to increase the value offered to the people you serve and even gain additional wallet share. 


Automate Your Client Engagement

Implementing an effective client engagement strategy is one thing, but even the most organized teams can quickly become overwhelmed by the communication needed to constantly stay in front of news, trends, and the personal, everyday concerns of clients.

That’s why, in addition to the client engagement examples offered above, automation is critical for an effective digital engagement strategy. With the 2023 Firm Growth Survey, we discovered interesting data to back up the need for automated client engagement in advisory firms. 

High-growth firms automate more communication

Overall firms who are growing slowly have less automated client communication than hyper-growth firms. But more importantly, they are roughly 1.5x more likely to have no automation set up at all. 

Automation is essential because it helps to free up time for advisors to develop their soft skills. In an industry like wealth management, where most advisors are expecting to be involved in business development and the prospecting process, automation can lead to more one-on-one personal interactions with clients and the time needed to follow up with prospective clients too.

When it comes to hyper-growth firms, 25 to 50% of communications are automated. When that much manual work is taken out of an advisor’s hands, a tremendous amount of free time is created to push toward revenue-generating activities instead.

Download the 2023 Growth Survey to read more about how high-growth firms are growing by automating their communication with clients.

Automation Leads to Personalization

When some advisors hear the word “automation,” their minds immediately think of impersonal communications, but that couldn’t be further from the truth.

The reality, though, is that personalized automation does ask for upfront time. When done correctly, automation involves correctly segmenting clients and groups, which can either take a few hours or a few weeks, depending on the quality of your data and the size of your existing list. That way, your firm can deliver personalized content without adding more work for advisors and staff going forward.

How exactly to implement automated client engagement strategies is an often-asked question, and that’s where technology shines. The best way to implement a personalized and automated communication process is with either your CRM or lead generation software, like a marketing automation tool similar to Snappy Kraken

Whichever technology solution makes the most sense for your firm, implementing workflows that put you in front of clients without the need to continually set up manual responses to every inquiry.


How to Build a Client Engagement Strategy with Nitrogen’s Risk Number®

Getting clients to consistently engage with your firm requires that you can quickly and simply show your value to them in real, tangible ways over and over. And most importantly, show that value in a way that’s easy for them to understand. 

The Risk Number® developed by Nitrogen is one simple way for advisors to offer an objective, quantitative measurement of their client’s true risk tolerance and the risk in their portfolio. By providing a quantitative aspect to financial advice, it’s easy for clients to engage with and understand the investment decision behind their financial plans.

Every advisor knows that the typical consumer is overwhelmed by financial information. On any given day, they may see differing headlines from their local news, The Wall Street Journal, CNBC, and a dozen other news sources. What each client needs is confidence in what they’re doing in that sea of information. The Risk Number provides a way for advisors to keep clients confident in their advice.

Most clients face a common fear – suffering losses that will derail their long-term plans. With the Risk Number at the center of annual reviews and other client conversations, advisors can turn fears into the confidence needed to make the right decisions for both the short-term and the long-term.

Whether you need to engage with prospective clients, help a married couple reach risk alignment, or simply remind clients during turbulent times that they are still within their confidence range, the Risk Number can help start conversations that keep clients invested right.


Connecting Portfolio Management to Client Engagement

Keeping clients engaged in their financial plan can’t end with conversations, though.  Engagement without results backing up those conversations will ultimately end up costing you clients and slow the growth of your firm to a crawl.

But how do you connect your client engagement strategies with the all-important investment and portfolio management work that you do behind the scenes to deliver results and desired outcomes?

Once again, advisors can lean on the Risk Number in these situations too. Once the Risk Number is established, you have concrete knowledge of how much risk a client wants to have in their portfolio, and you know if their risk tolerance matches to how they’re invested. But even more, you know how their current risk tolerance aligns with the level of risk tolerance they need to meet those goals you’ve discussed. 

Here’s how:

A portfolio-wide Risk Number, when combined with the 95% Historical Range that sets expectations for portfolio performance outside of any “Black Swan” events, enables you to make investment decisions that demonstrate alignment with the risk tolerance of your existing clients and new prospects.

When portfolios are built this way, you can directly connect the way you manage client portfolios with the way you talk to them about preferences, desires, fears, and the goals they’ve communicated to you. Investments and plans come together seamlessly.

And in the end, building portfolios around the same tools that you use to engage with clients brings symmetry across your entire organization. From every client conversation to every portfolio you construct, there’s a consistent process at the center.  


What the 2023 Nitrogen Advisor Growth Survey Reveals About Client Engagement

The 2023 Nitrogen Growth Survey identifies the challenges to growth that affect every advisory firm – and then identifies the way that high-growth firms are confronting those challenges and exceeding expectations.

When clients feel heard, they naturally reach out to their advisors more and remain satisfied clients longer. According to one survey, failure to properly communicate is cited by 72% of clients who fire their advisors. Clearly, effective client engagement is one of the most essential things for firms to invest in if they want to build more successful businesses.

Learn how client engagement strategies are powering growth and why Nitrogen customers are 60% more likely than non-Nitrogen customers to achieve hyper-growth. Take a tour today.


Share This Story