blog
The Importance of Selling Advisors More Products
By Andrew Maniglia
Asset managers should push their existing clients to use more of their funds. Of the many insights our FA Vision data has yielded, this is among the most widespread and well documented. There is a strong link between an advisor's perception of an asset manager and the number of products he sells from the firm. More specifically, advisors who sell more of an asset manager's products are likely to do more business with the firm in the future and are more likely to recommend the firm to a friend or colleague. All twenty three firms in our benchmarking survey reveal this trend, and asset managers should take a strong initiative to sell additional products to existing clients. I believe this should be a key focus for the sales force.
If the diner across the street from my office served a great tuna melt, then I'd make sure to go across the street and get one every time I was in the mood. Alternatively, if the diner were to offer a wide range of lunch items, then I'd be a more frequent and loyal client. Instead of going once every few weeks for the tuna melt, I'd find my way over for a burger, rice pudding, western omelet, so on and so forth. The same formula applies for asset managers. By introducing a client to a wide range of firm products, a wholesaler can transform a one or two product client into a loyal advocate who is deeply engaged with the firm's business.
Without even drilling down to a specific fund manager, firm advocates are generically likely to sell more of a firm's products than non-advocates, according to an Independent-Samples t-test. Non-advocates sell, on average, 3.09 of a firm's products, while advocates sell an average 4.32 of a firm's products. This relationship varies in magnitude from firm to firm, but holds true for all firms in our survey. Our survey also asks advisors how much business they anticipate doing with a firm in the next 12 months. Without zoning in on any particular firm, the advisors who plan to do "more" business with the firm already sell, on average, 3.94 products, compared to advisors who say they plan to do the "same" amount or "less" with a firm currently selling 3.45 and 2.56 of the firm's products, respectively.
The findings make sense - advisors who are engaged and sell more of the firm's products are the more loyal clients. Asset managers should keep tabs on the number of products each client sells, and set the sales force to the task of increasing that number over time. Introducing clients to a wide range of products is an important step towards building a strong base of clients.