Encouragement in the Face of Defeat
Being a data analyst allows me to see behind the curtain and peer into the deep-rooted details of many advisory offices. I am honored to be allowed in that space and do not take that trust lightly. After examining many offices this year, I believe I can bring encouragement to others who may be wondering what is “normal” right now and who may be asking, “Am I the only one feeling defeated in this area?” So, let me give you a sneak peek backstage at the exciting and positive things happening in our industry right now, from a data analyst’s perspective.
1) The number of kept first appointments is down across the board, except in the referral category. Nearly every office we work with has half to two-thirds the number of kept first appointments this year over last year. This is not just in the seminar sector but in radio, TV, etc. The exception to that is referrals. We are seeing more referrals in the offices that are thriving this year over last year.
2) New business from client referrals and existing clients is soaring. Track That Advisor typically recommends 30% to 40% of business come from existing clients and referrals (combined). But this year, we are recommending/seeing 60% to 70%. The number of kept first appointments is up for client referrals, thus leading to higher production from that source. Existing client production is up by several million dollars in new production compared to 2019 for the majority of our clients who are flourishing in this time.
3) Closing percentages are up. As mentioned in trend No. 1, the overall number of kept first appointments is down. But, this is not stopping our successful clients from digging deep and closing more of those first appointments. They are making lemonade out of the 2020 lemons. Kept first appointment/client closing ratios have increased by 5% to 10% over 2019. The Track That Advisor benchmark for kept first appointment/client closing is 30%. This year, most of our thriving offices are averaging 35%, whereas last year’s national average was closer to 25%. Part of this could be due to fewer marketing funnel leads and more referrals, which generally increases closing rates, but we are also seeing higher closing rates for radio and other marketing sources.
4) While marketing ROIs are down overall, total ROIs remain in a healthy place. Due to so many advisors writing so much more existing client and referral business, which costs a fraction of other marketing efforts, their overall ROIs are evening out to a healthy place. This is extremely encouraging to them and shows that their clients trust them to help in times of concern — I see this as a win for them and their clients.
I have been in this industry for more than a decade and consider that a good amount of time, most of our clients at Track That Advisor have been thriving in this space for much longer. They have experienced the rush of bull markets and survived the bear markets. They have picked themselves up by their bootstraps and continued anytime a crisis hit. This unprecedented year may have tried to take them down yet again, but it has not stopped them from thriving in such a time as this. I am proud to work with these ladies and gentlemen, especially right now. In an era of watching humans turn to our fight-or-flight responses, my clients are fighting tooth and nail. I’m excited to watch (and cheer them on) from the sideline. There are great things still happening out there; they just might be hiding behind a curtain.
Erica Pauly is the founder of Track That Advisor, a data analytics company founded in 2015 that provides analysis on over $1 billion of new annuity business and assets under management each year for independently owned advisory offices across the nation. As seen in AE Insider.