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TRANSCRIPT
Disclosures
Issued by Russell Investment Management Ltd ABN 53 068 338 974, AFS Licence 247185 (“RIM”). This communication provides general information only and has not been prepared having regard to your objectives, financial situation or needs. Before making an investment decision, you need to consider whether this information is appropriate to your objectives, financial situation and needs. This information has been compiled from sources considered to be reliable, but is not guaranteed. Past performance is not a reliable indicator of future performance.
Copyright © 2014 Russell Investments. All rights reserved. This material is proprietary and may not be reproduced, distributed or transferred in any form without prior permission from Russell Investments.
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Agenda
› Client value proposition
› Three components
› Client engagement roadmap
› The WOW review process
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Thinking about your business… where do you add value?
› How is your business different?
› Why should a client choose you over your competitors?
› What do you provide that is different to what they could get
elsewhere?
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What is a value proposition?
A simple, clear statement of who the target customers are and precisely what key benefits you offer.
When done effectively, the Value Proposition should
accurately articulate the experience of working with
your business.
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Russell example
Value proposition to advisers
Value statement: Russell delivers consistent relative returns for clients, giving advisers peace of mind. Our global
reach, unparalleled resources, blue-chip client base and unmatched experience also provides
advisers with a feeling of trust and security.
Proof points:
All funds have outperformed their median manager and multi manager peers.
Russell operates in 46 countries worldwide and employs over 700 investment professionals.
Russell is global leader in multi-manager investing.
Russell directs the investment of over $195 billion for the world’s largest pools of capital.
Russell’s client list include: Bill and Melinda Gates Foundation, BHP Billiton
Millions of individual investors use Russell’s services.
Delivery statement:
Russell builds institutional quality portfolios that are diversified at three levels:
Multi-asset
Multi-style
Multi-manager
Note: Past performance is not a reliable indicator of future performance
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Why do I need a value proposition?
Being able to get the word out about the services or
products you can deliver is one of the most effective
ways to grow your business.
The value proposition helps to ensure your message sticks.
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Value of a value proposition?
Before
Assets under management = $30 million
Number of clients = 190
Revenue per client = $866
Product sales focus
Large majority commission revenue
Principal responsible for sales and service
Case study
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Value of a value proposition?
After 20 months
Assets under management = $330m
Number of clients = 166 (24 LESS)
Revenue per client = $8,577 (10x)
Minimum account size = $2m
Revenue is >90% fee based
100% of new business from client referrals
Dedicated functional teams – Sales, Service, Ops
Principal as relationship quarterback
Case study
Today
the business
is approaching
$500m AUM
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Russell’s Client Engagement Road Map
› Provides a framework for your clients’ experience
› Systemise your communication
› Provides tailored solutions
› Provides a template for reviews
› Chart key client milestones
› Demonstrates and articulates your value
› Get credit for all the work you do
› Removes onus on performance
› Facilitates discussion
Giving your clients ANOTHER reason to recommend you
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Why use the Client Engagement Road Map?
› Enables you to not only do great work for the client but make
sure they know about it!
› Outlines the scope of the client engagement and allows for
CREATION, PRIORITISATION and COMPLETION of appropriate
strategies on a regular basis.
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Q1 – Office •Goals Review •Roadmap •Investment Review •Financial Plan Update •Revisit Risk Profile •Other Accounts •*Equities
Q1 - Office
•Financial planning •Data Gathering •Risk Tolerance •Long term plan •*Diversification
Q2 - Meeting •Goals Review •Roadmap •Investment •Implementation •Life Insurance •*Budgeting strategies
Q3 - Phone call
•Goals Review •Roadmap •Income protection •Mortgage review * Long-term view
of the Market
Q4 - Venue TBC
•Roadmap •Client Satisfaction •*Client Information evening
Q2 - Phone call •Goals Review •Roadmap •Tax strategies •*Superannuation
Q3 – E-mail/ printed material
•Goals Review •Roadmap •Market reports •Superannuation •Legislation updates •Risk Review •*Gearing
Q4 - Home •Goals Review •Roadmap •Investment Review •Risk review •New prod/services •*Risk
Road Map for Mary and John
Client
This sample material is for Financial Professional educational
use only and is not for distribution to current or potential
investors.
*Educational
topic
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2nd Qtr Meeting •Goals Review •Roadmap •Investment • Implementation •Life Insurance •*Budgeting strategies
3rd Qtr Phone call
•Goals Review •Roadmap •Income protection •Mortgage review * Long-term view
of the Market
1st Qtr
•Financial Planning •Data Gathering •Risk Tolerance •Long term plan •*Diversification
4th Qtr •Roadmap •Client Satisfaction •*Client Information
evening
1st Qtr •Goals Review •Roadmap •Investment Review •Financial Plan Update •Revisit Risk Profile •Other Accounts •*Equities
2nd Qtr •Goals Review •Roadmap •Tax strategies •Superannuation
3rd Qtr •Goals Review •Roadmap •Market reports •Superannuation •Legislation updates •Risk Review •*Gearing
4th Qtr •Goals Review •Roadmap •Investment Review •Risk review •New products/services •*Risk
1st Qtr •Financial Planning •Data Gathering •Risk Tolerance •Long term plan •*Diversification
This sample material is for Financial
Professional educational use only and is not
for distribution to current or potential investors.
*Educational topic
Road Map for Mary and John
Client
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This sample material is for Financial Professional
educational use only and is not for distribution to current
or potential investors.
*Educational
topic
1st Qtr-Office
• Financial planning • Data Gathering • Risk Tolerance • Long term plan • *Diversification
2nd Qtr Meeting • Goals Review • Roadmap • Investment • Implementation • Life Insurance • *Budgeting strategies
3rd Qtr Phone call
• Goals Review • Roadmap • Income protection • Mortgage review * Long-term view
of the Market
4th Qtr-Venue to be confirmed
• Roadmap • Client Satisfaction • *Client Information evening
1st Qtr-Office • Goals Review • Roadmap • Investment Review • Financial Plan Update • Revisit Risk Profile • Other Accounts • *Equities
2nd Qtr-Phone call • Goals Review • Roadmap • Tax strategies • *Superannuation
3rd Qtr Email/ Printed material
• Goals Review • Roadmap • Market reports • Superannuation • Legislation updates • Risk Review • *Gearing
4th Qtr Home • Goals Review • Roadmap • Investment Review • Risk review • New products/services • *Risk
FIRST YEAR
Current Future Completed
SECOND YEAR
Road Map for Mary and John
Client
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This sample material is for Financial Professional educational
use only and is not for distribution to current or potential
investors.
*Educational
topic
1st Qtr-Office
• Financial planning • Data Gathering • Risk Tolerance • Long term plan • *Diversification
2nd Qtr Meeting • Goals Review • Roadmap • Investment • Implementation • Life Insurance • *Budgeting strategies
3rd Qtr Phone call
• Goals Review • Roadmap • Income protection • Mortgage review * Long-term view
of the Market
4th Qtr-Venue to be confirmed
• Roadmap • Client Satisfaction • *Client Information evening
1st Qtr-Office • Goals Review • Roadmap • Investment Review • Financial Plan Update • Revisit Risk Profile • Other Accounts • *Equities
2nd Qtr-Phone call • Goals Review • Roadmap • Tax strategies • *Superannuation
3rd Qtr Email/ Printed material
• Goals Review • Roadmap • Market reports • Superannuation • Legislation updates • Risk Review • *Gearing
4th Qtr Home • Goals Review • Roadmap • Investment Review • Risk review • New products/services • *Risk
FIRST YEAR
Current Future Completed
SECOND YEAR
Road Map for Mary and John
Client
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1st Qtr-Office
• Financial planning • Data Gathering • Risk Tolerance • Long term plan • *Diversification
2nd Qtr Meeting • Goals Review • Roadmap • Investment • Implementation • Life Insurance • *Budgeting strategies
3rd Qtr Phone call
• Goals Review • Roadmap • Income protection • Mortgage review * Long-term view
of the Market
4th Qtr-Venue to be confirmed
• Roadmap • Client Satisfaction • *Client Information evening
1st Qtr-Office • Goals Review • Roadmap • Investment Review • Financial Plan Update • Revisit Risk Profile • Other Accounts • *Equities
2nd Qtr-Phone call • Goals Review • Roadmap • Tax strategies • *Superannuation
3rd Qtr Email/ Printed material
• Goals Review • Roadmap • Market reports • Superannuation • Legislation updates • Risk Review • *Gearing
4th Qtr Home • Goals Review • Roadmap • Investment Review • Risk review • New products/services • *Risk
FIRST YEAR
Current Future Completed
SECOND YEAR
Road Map for Mary and John
Client
This sample material is for Financial Professional educational
use only and is not for distribution to current or potential
investors.
*Educational
topic
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Road Map for Mary and John
Client 2nd Qtr Meeting • Goals Review • Roadmap • Investment • Implementation • Life Insurance • *Budgeting strategies
3rd Qtr Phone call
• Goals Review • Roadmap • Income protection • Mortgage review * Long-term view
of the Market
1st Qtr
• Financial Planning • Data Gathering • Risk Tolerance • Long term plan • *Diversification
4th Qtr • Roadmap • Client Satisfaction • *Client Information
evening
1st Qtr • Goals Review • Roadmap • Investment Review • Financial Plan Update • Revisit Risk Profile • Other Accounts • *Equities
2nd Qtr • Goals Review • Roadmap • Tax strategies • Superannuation
3rd Qtr • Goals Review • Roadmap • Market reports • Superannuation • Legislation updates • Risk Review • *Gearing
4th Qtr • Goals Review • Roadmap • Investment Review • Risk review • New products/services • *Risk
Customise this Example for
Your Business and Your Clients
This sample material is for Financial Professional educational
use only and is not for distribution to current or potential
investors.
*Educational
topic
Constructing your service offer
› Discovery process
› Planning tools
› Advice documentation
› Implementation
› Ongoing service and support
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Formulating your service matrix
Financial advice (A-grade clients)
Discovery process
Planning tools
Advice documentation
Implementation
Ongoing service
Low touch (B-grade clients)
Discovery process
Planning tools
Advice documentation
Implementation
Ongoing service
Transition Strategy (C and D-grade clients)
Discovery process
Planning tools
Advice documentation
Implementation
Ongoing service
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Ongoing service model (A-grade clients)
› How often do you conduct reviews? In person vs. via the
phone?
› How should those reviews be structured?
› What additional personal touches should you implement?
› What special events or client appreciation events should
you deliver?
› Other ideas?
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The WOW review – impact on profit per principal
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Key Value Driver Yes No
Documented review process? $390,456 $159,182
Formally ask for feedback? $520,336 $298,970
10+ A-grade client contacts per year $443,950
5-10 A-grade client contacts per year $314,084
<5 A-grade client contacts per year $114,732
Source: Business Health White Paper, 2009
The WOW review
› Improve the overall experience
› Focuses on client’s goals
› Emphasize what is within your control
› Put market/performance in proper context
› Requires creativity and consistency
› Will require increased effort on your part
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Three things to consider
1. Review components and sourcing
2. Process for timely/efficient production of materials
3. Checklists to ensure quality
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Immediate follow-up contact
It was truly a pleasure meeting with you and Linda this morning using the
benefits of technology. Both of you are really wonderful people, and it is my
sincere pleasure to count you among my friends and clients. I thought a quick
summary of the "to-do" items from our meeting would be helpful.
Life Insurance….(brief summary)
Estate planning…(brief summary)
Cash reserves…(brief summary)
As agreed, we need to following from you as soon as possible…
We will be working on the following…
We truly value our relationships with you. Please don’t hesitate to contact our
office with any questions or concerns.
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The WOW review
› What is in your WOW Review package?
› What is the source of each component?
› Who is the owner of each component?
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WOW Package Components Source Owner
The need for process
The study…
”found that only a small group of
advisors truly practice the relationship-
oriented, process-driven approach that
defines wealth management.”
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Source: “Best Practices of Elite Advisors. The Wealth Management Edge”. October 16, 2007
Survey of 2,094 advisers with at least $50 million assets under administration.
WOW process
2. Determine the timeline required to create the whole
experience
› Setting appointment
› Preparing materials
› Reviewing materials
› Delivering the review
› Follow-up
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WOW review assignments
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Days Component or Action Owner
-20 Pull file for quarterly meeting
-19 File to adviser for review
-17 Phone client to set appointment
-17 Send meeting reminder
-17 Update Discovery Agreement
-17 Update CRM
-17 Update goals-based Reporting
-15 Prepare mail – Letter, discovery agreement, Road Map
-11 Mail Package – Letter, discovery agreement, Road Map
-11 Select/prepare education piece
-11 Prepare other reports for Meeting Package
-8 Other agenda items – based on client request
WOW review assignments
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Days Component or Action Owner
-7 Assemble Draft Meeting Package
-5 Review Meeting Package
-2 Re-review Meeting Package
-0 Facility check
0 Meeting takes place
0 Write meeting notes and action items
0 Follow-up email/letter is composed
0 Email/letter sent to client
0 Next meeting tentatively scheduled
0 Send gift or other consideration
+1 To-do’s assigned
+2 File is closed
WOW process
› Develop checklists to make sure you execute
› Reception/greeting checklist
› Meeting room checklist
› Post-meeting checklist
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Why have checklists?
“No institution can possibly survive if
it needs geniuses or supermen to
manage it. It must be organized in
such a way as to be able to get
along under a leadership composed
of average human beings.”
Peter Drucker
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Putting reviews in context
› Move to fee for service = more client meetings
› Achieving positive meeting outcomes a necessity
› Success is not measured by client acceptance
› Meetings are always a matter of personal style
› Most common reason advisers lose clients is…
› markets/returns
› competitor
› change of needs
› lack of relationship
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Why hold reviews
› is it because...
› compliance makes me
› clients want them
› I like to show off
› do you prefer...
› client events
› group presentations
› passive investors
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Key purposes of a review
•Changes to the client’s circumstances and how they responded
•Understand client’s perspective and headspace Situational awareness
•Factual information about the economy and markets
•Implications to their portfolio and long-term goals Reasoned perspective
•Confirm they are still valid, appropriate and inspiring
•Include both financial and non-financial elements Review goals
•Take into consideration changes in circumstances and goals
•Again, include both financial and non-financial elements Update plan
•Committed to long-term goals and the plan to get them there
•Your role as key to achieving these goals Deeper relationship
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What not to do
› serve lousy coffee
› don’t prepare, it’s not a new client
› keep the focus on investment returns
› do most of the talking
› drown clients in details
› agree to do everything the
client wants
› avoid talking about fees
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The pre-meeting checklist
› meeting itself is well communicated
› team knows the clients are coming
› names and drinks where appropriate
› meeting room is clean and inviting
› familiar with their circumstances
› not rushing to (or from)
another appointment
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Four phases of the client review meeting
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Opening
• set the tone
• confirm the agenda
• 5 to 10 mins
Words
• cover the agenda
• focus on client
• 20 to 50 mins
Numbers
• review and discuss
• reach agreement
• 25 to 50 mins
Closing
• summarise discussions
• confirm next steps
• 10 minutes
The opening
› reconnect with the client
› positively framed question
› ensure agenda is relevant
› is anything urgent
› is anything missing
› deepen engagement in meeting
› what would make this a great meeting
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Opening
• 5 to 10 mins
Words
› first discuss item(s) added to agenda
› Review and discuss:
› milestone events
› change in circumstances
› progress towards goals
› reaction to market volatility
› long-term vision
› general quality of life
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Words
• 20 to 50 mins
Numbers
› overall financial position
› portfolio performance
› economic developments, trends and
implications
› current asset allocation and appropriateness
› implications of recommended changes
› agreement on changes
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Numbers
• 25 to 50 mins
Closing
› review and confirm
› market conditions
› asset allocations
› action items
› identify a highlight
› create a positive image of the future
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Closing
• 10 minutes
What have you done for me lately?
› How often do you meet with clients?
› What do they think you do between meetings?
› Do clients know exactly what you do for them?
› How do you reinforce this?
› What are they really looking for?
› investment philosophy
› peace of mind
› Have you asked them what they want?
› Have you asked your team what they deliver?
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FINANCIAL PROFESSIONAL USE ONLY
Point of maximum
financial opportunity
Optimism
Relief
Hope
Denial
Capitulation
Fear
Despondency
Panic
Depression
Desperation
Anxiety
Euphoria
Thrill
Excitement
Optimism
Point of maximum
financial risk
Where are we now? Depends on which market you are looking at ……
Dec-Feb
Mar-Jun
Aug
SOURCE: Russell Investments