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Defining Client Value Beyond $ Signs

Segmentation is the first critical step toward greater efficiency and ultimately improved profitability. In our blog, “Take the First Step Towards Greater Efficiency With Client Segmentation,” we provided you with basic steps and resources to segment your client database.

Start your segmentation process by defining client value.  Viewing each group with different needs and priorities will present you with the ability to serve each segment based upon their needs, not the firm’s profits.

Client segmentation is about improving customer service for all of your clients.  Use it to deliver solutions more effectively by streamlining and automating the services you offer.  Aligning the right level of advisor support to the client’s specific needs results in increased client satisfaction and in turn may even result in more client referrals.

Advancing Your Client Segmentation Plan

Client segmentation needs to be taken to a deeper lever in order to gain the full benefit.  Once your initial segmentation process is complete, you are ready to segment your client database further by distinguishing clients based on characteristics beyond the dollars.

Many advisors have not segmented their client database in a meaningful way beyond assets under management.  Assets under management will be your constant starting point for segmentation and predicting client needs.   Understanding that clients within the same segmentation class still have extraordinary needs and expectations will allow you to provide matched solutions with your product and service offerings.

Trying to provide the same high level of service to everyone can make it difficult to focus on the more complex clients and on the inevitable changes that come with growth and business development.  Ironstone can assist you in all phases of client segmentation and ultimately design a comprehensive client segmentation plan that will allow you the opportunity to hone in on specific and unique needs of clients within each segment.

Ironstone recommends  you place some of the following attributes in your segmentation plan beyond assets under management:

  • Revenue produced for the firm
  • Quality of your relationship with the client
  • Earnings potential
  • Client lifestyles & life events
  • Client demographics
  • Risk analysis/Behavioral attributes

Applying the above listed characteristics will provide another layer to your segmentation plan and aide in shaping optimal service for your clients.  You may not want to engage in each market base, but you can start with the characteristics that employ the biggest role in improving your firms’ bottom line.   By marketing to each subcategory you will accomplish more targeted messages and information that will resonate with your clients, resulting in engaged clients and prospects, higher response rates and a shorter conversion cycle.

Use this model to segment your clients by determining their level of revenue and the value of the business relationship.08.06.12 Segmentation Guide

Readers, we are curious!!  How do you approach segmentation in your firm?

Follow us as we explore each of Ironstone’s Fundamental 4™!

  • Strategic Planning
  • Business Development
  • Operational Effectiveness
  • The Human Element

You won’t want to miss our next in the series:  The Human Element-Job Descriptions

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Understanding Purposeful Meaning In Your Client Service Matrix

A service matrix is an established unique resource in the financial industry. It provides you with a comparative analysis of your service offerings and differentiates you from your competitors.

Creating a service matrix will help you identify the level of service your clients will receive when they work with your firm. By clearly defining and evaluating your services, you will have the ability to provide value to your clients and the level of service they desire. Build your service matrix to gain strategic insight into the unique needs of each of your client groups and continuously modify it as a part of your firms client engagement strategy.

A client service matrix serves several purposes:
• Encourages clients & prospects to use your firm for all of their financial planning needs
• Clarifies what service levels each client can expect
• Aligns advisor time and resources
• Provides a way to thank your most loyal clients

When creating or evaluating your client service matrix consider surveying your current clients to determine what services they would like. High net worth clients will be attracted to your firm as you provide more personal attention. Create a list of the services you currently provide and a separate list of the services that you would like to provide. Determine which clients will receive each of your services.

Two levers that you can control in your service matrix are service level and sales effort.
Service Level: determine the appropriate level of service to provide to the different levels in your client segmentation plan. (read our blog on Client Segmentation-insert link here)
Sales Effort: control the level of effort that you will put towards client retention, gaining referrals, adding new services and promoting new products by pursuing the right opportunities with aligned client segments. This will provide increased revenue for your firm.

In order to maximize on your services, focus on what you do best. Providing high-quality personal service to your clients and prospects is more important than providing many mediocre services.

As you create and evaluate your service matrix, assess each process in relation to attractiveness (is it what clients want?) and is it providing your client with value. Evaluate processes that can be eliminated and identify which processes align with your mission statement. Your services should have few competitive alternatives and your firm’s offerings should be very strong.

Your client service matrix will allow you to hone in on the unique needs of each of your clients. Understanding that each of your clients has unique needs will ensure efficient client service delivery.

“In business, words are words, explanations are explanations, promises are promises, but only performance is reality.” Harold Geneen

Ironstone can assist you in developing a client/prospect service matrix. We specialize in identifying gaps in your existing plan and will collaborate with you to develop solutions that are parallel in achieving the results your desire.

Contact us for assistance in starting and improving your Service Matrix. We want to hear from you! Share your best ideas here! What services do you provide that are unique from your competitors? We always love hearing from you!

Follow us as we explore each of Ironstone’s Fundamental 4™!
• Strategic Planning
• Business Development
• Operational Effectiveness
• The Human Element

You won’t want to miss our next in the series: The Human Element-Hiring & Onboarding
• Email us at
• Call our office at 800-917-8020
• Follow us on twitter @!/AndreaSchlapia
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