How to Increase Client Engagement for Financial Advisors 

During uncertain economic times, it’s often easier to find the motivation to engage clients frequently — at least, that’s what one study suggests. However, using an effective client engagement strategy during both bear and bull cycles builds a stronger client relationship.

Consistent and effective client engagement leads to higher retention rates, which enables advisors to grow their business and better generate referrals. And this effort begins from day one.

An E*TRADE study found that 20% of clients leave an advisor after their first year. Out of second-year clients, advisors can expect a 25% turnover. Another study discovered that communication and a personal connection are cornerstones of a successful client experience and retention.

But how can investors boost their engagement and client loyalty? Before diving into the 6 steps toward a more robust client engagement strategy, we need to review what successful client engagement looks like.

The science of client engagement for advisors

Before an advisor can consider how to increase client engagement, it’s important to highlight what engagement means in an advisory context. Registered Investment Advisors have a different client interaction experience than other financial services professionals — including advisor-brokers. 

An engagement strategy for RIAs and other fiduciaries is measured via client retention and positive communication. But even with access to client data, engaging clients requires a personal approach rather than mass-market tactics. 

So, what can advisors use to define an engaged and loyal client? The following client interactions suggest a strong client engagement strategy:

• Frequent communication from clients
• Clients voluntarily update you on life or financial events
• Conversations extend beyond investments to personal life topics
• Clients respond to your email content, social media, or other marketing materials
• You receive regular and relevant questions about portfolio specifics. 
• They involve their family or additional advisors in the financial planning process.

However, it’s also important to remember that not all clients have the same communication styles. For example, a client refuses to divulge personal information but may respond to questions quickly and provide relevant information.  Client engagement data can help you prioritize client communication and needs, but knowing your client’s communication style can give you context to their engagement level.

How to increase your client engagement in 6 steps

It’s easy to get lost in the minutiae of the client experience and retention. But it’s possible to fine-tune your strategy with 6 easy, overarching steps. These are actions you can start today that will increase client satisfaction and streamline your workflow.

1. Refine your prospect to client pipeline

The best way to increase your client engagement over the long haul is to have a clear strategy that begins with prospects. Understanding your prospect-to-client pipeline enables you to set expectations at the start of your client relationship and create a scalable, interactive workflow. 

One way to refine this process is by generating high-quality proposals.

Traditionally, it was common for advisors to forward lengthy reports to clients. Those reports, full of confusing charts and financial jargon, often remained unread. The average client doesn’t have the time or interest to sit through dozens of pages, especially on their own.

The key to a shorter proposal and superior client experience lies in specificity and presentation. This report should lead with risk. You can set clear expectations almost immediately by highlighting what a client can lose rather than gain, especially for those with a low-risk tolerance. 

Another method of impressing and engaging prospects and current clients with your reports is using scenario analyses specific to your clients’ portfolios and clear visuals to present them.

2. Anticipate client needs

It’s impossible to figure out what clients think, but you can prepare for common client needs. When you address a client’s emotional and intellectual process, it’s much easier to foster a strong long-term relationship.

So, what can you categorize as client needs?

Common denominators tend to be items like financial planning advice, frequent communication, and positive performance. 

However, it’s the unique aspects you’ll want to consider. For example, one client may be hoping to grow their family, and another may be struggling to take care of a partner with Alzheimer’s. All of these life events and challenges directly impact clients’ finances, and they may need both advice and emotional support.

To better tap into and address these needs, it helps streamline as many repetitive processes as possible. That way, you have more time to spend with clients.

3. Check in regularly

Clients value regular and relevant communication. However, following up with them can be time-consuming, especially if you call or email them manually. Even with a CRM, it’s challenging to prioritize who might need your immediate attention. And without a clear way to streamline your communication, it becomes difficult to scale.

Automated, regular check-ins can make this easier. 

For instance, the Nitrogen growth platform enables you to send a simple, two-question survey to clients. This survey measures their current sentiment about their portfolio and the market. Combined with other client data, such as their risk score, the platform helps advisors identify clients who need immediate attention.

4. Simplify explanations

It’s hard to engage clients when they don’t have a frame of reference. However, using the six-month historical average isn’t enough. Using simple tables to showcase their portfolio or potential market scenarios can make it easier for clients to “get it.” 

And when your clients understand what you’re saying, they are more likely to be engaged, ask questions, and provide essential information. 

5. Show appreciation

Everyone likes to feel valued, including your clients. And there are many ways to show your appreciation.

Seminars, birthday cards, season greetings, fairs, and other activities are a great way to get started. But the easiest way to help clients feel appreciated is to ask them questions and check in about their personal lives. Speaking to them as a friend rather than a client shows how much you value them as a person, not just a number.

6. Share relevant educational content

Even if you explain financial concepts or current market conditions during a one-on-one client meeting, they will be unlikely to remember all the details. But there’s a great way to refresh their memory and boost engagement: Educational content. 

You can create educational content through onboarding packets, videos, newsletters, blog posts, online courses, and webinars. You could even record a brief video for clients to explain general market trends or major economic shifts. Often, this approach is part of an overarching content marketing strategy and can be used to attract potential clients, too. 

This approach is highly scalable. So long as you don’t base your content around personal client information and you aren’t giving advice, you can send this information en-mass to clients and prospects. You can also reuse this content later on when relevant. 

Build a stronger client relationship

You can boost client satisfaction and promote retention among newly acquired and existing clients with a strong engagement strategy. These 6 steps are a great start, but there is more than your firm can do to inspire client loyalty in the long term.

To learn more about what you can do to streamline your strategy, check out our in-depth article on client engagement strategies.