The Covisum team recently returned home after spending a week in warm, sunny San Diego, CA for the 2020 T3 Advisor Conference. T3 creates space for innovation and collaboration with some of the best and brightest in fintech. It’s a great place to see the innovations from other financial technology companies, find opportunities to collaborate, meet with early tech adopters, and release exciting news.

Here's a quick recap of all the Covisum news from the conference. 

Covisum Now Offering Practice Management Resources for Advisors

Today, Covisum®, the developer of Social Security Timing®, Tax Clarity®, SmartRisk™, and Income InSight® software solutions for financial advisors and institutions, announced a new offering – practice management resources.

The latest practice management resource from Covisum, The Financial Advisor’s Guide to Lead Generation, helps advisors create digital content that speaks directly to their target clients’ needs and demonstrates specific expertise. The Advisor’s Guide to Lead Generation takes the guesswork out of inbound marketing for advisors.

“The strategies for finding new clients are changing,” said Covisum’s Vice President of Sales and Marketing, Katie Godbout. “Consumers are doing their own research before seeking out a financial advisor. Especially if someone refers you. You need to know that they’re going to check you out online. They don’t want to waste their time if you don’t specialize in the areas that they need.”

“Adding some strategic inbound marketing efforts to your traditional marketing channels – like seminars, social media marketing, and direct mail – can give your firm a comprehensive strategy that amplifies your visibility and captures the right leads to grow your business,” said Godbout.

Covisum plans to offer additional practice management resources for advisors starting later this year. The guide is now available for free download on the Covisum website.

Turn Your Marketing Inside Out

Covisum Founder and President, Joe Elsasser, CFP® presented on how to turn your marketing efforts inside out to grow more efficiently and create a base of fans who become the engine that generates referrals. You can watch his presentation below.





Today we're going to talk a little bit about turning your marketing inside out. Really, this presentation evolved from a conversation between me and my marketing team. And, yet, so many advisors get stuck at that point right next to implementation and the idea with turning your marketing inside out is how can you get unstuck?

So, we're going to talk about a couple of advisors. We're going to talk about Steve and Reena. We'll talk about how they think about their business because I think that is the one thing that strikes me more than anything else. I started out as an advisor and continue to work with individual clients. Along the way, I built a software company called Covisum®. Along that path, I got to interact with some really smart marketing people who were all about the inbound process.

If you went to Robert's presentation yesterday or a variety of the other marketing presentations, it's about how inbound marketing is really that next stage for financial advisors. And, yet, some of us get blocked, get blocked on that path and that journey, and so that's what we'll talk about today.

Seminar Steve

First off, meet Seminar Steve. Steve is a guy that we've worked with on a really regular basis. What has made him tremendously successful over the years is that he's been very good at listening to what's going on out in the marketplace. This year, the SECURE Act passed and there were slides in his deck right away. He was adding the information to his seminar invitations. He's out there marketing the things that are going on in the industry right now. And he's amplifying that message in a variety of ways. His preferred way, of course, is seminars.

Now, when Steve gets that message out there, he's going to get a variety of people, so the next thing he's got to do is qualify. He's got to narrow those people down to the people he can actually serve. And, finally, he's going to close. He's going to deliver those services to the ones that are a fit for him.

Now, Steve's goal for this year is growth. He wants to increase his historical growth from an average of $8 million a year to $15 million. And in order to do that, he knows he needs about 30 new clients. He expects to do it with relevant, cutting-edge software

Do you guys know this guy? Is this guy somebody you work with, somebody that you've been around?

So, Steve's funnel, when you think about how he thinks about his business is, listen, market, qualify, and close. He's listening to strangers. He's marketing more to strangers than to leads. He's qualifying in order to direct leads to prospects and ultimately closing creates that predictable funnel. That's what we're all after, right? If I put one dollar into marketing, I want to know how many dollars are going to come out on the other end of the funnel in revenue. So, that's Steve's funnel.

What can Steve do in order to roughly almost double his revenue this year? He can identify additional topics to continue to stay cutting edge. He can add more and more topics to the seminar schedule.

If he wants to increase leads, he can simply buy more advertising and push it out to more people. If he wants more prospects, he can add more products and services, so he doesn't have to qualify so many people out of his pipeline. And, finally, if he wants more clients, he can charge less or reduce minimums. And, ultimately, Steve's challenge is that by doing more and more and more and more, he ends up looking like this.

On his website, he says, "We serve individuals, families, business owners, institutions. We serve everybody and we do everything,” and then he wonders why his value proposition is something like this. So, that's Steve's primary challenge in growing with the more and more and more mentality.

Client Acquisition Cost

The question is, "Does it work?" Anybody see Michael Kitces’ study earlier this week that came out on client acquisition costs? Does it work? Steve's going to be able to grow, right. As long as his customer acquisition cost is less than the lifetime value of those clients; he's going to be able to grow.

In terms of how we think about that, Kitces' survey was really fantastic in what they identified as the average client acquisition cost. It's actually about $3,100. And for a lot of people, that $3,100 sounds like a huge number. If you're writing blogs and doing all these things that are technically free, you're not accounting for your time. When you account for your time, that average client acquisition cost is about $3,100.

And when you think about an average client lifetime, how long is the client with you—10 years, 15 years, 20 years? And maybe their average client revenue for a year, gross revenue, is— $5,000, $10,000, $15,000 a year. So, the lifetime value of these clients makes it absolutely worth spending on the front end to acquire. But you're running into a challenge, and that challenge is whether or not there's enough cash flow.

So, even in that survey, it talks about “J curve” where you're spending money today in order to acquire a client that's going to take three, five, seven years to really be profitable to your business. Not to mention that for most of us, the heaviest work is on the front end. You do a fantastic job lining up the initial plan, then monitoring the plan becomes so much easier. So, is there enough cash flow to support it?

And, finally, is capital available? There's capital flowing into our business left and right because what we do as advisors is a special skill. Communicating with clients, being able to involve them in your process, and being able to get them to stick with you is something that humans uniquely do. It's why Robos are adding people.

Now, does it work? Of course, it works. That's how advisors have worked for years, for decades. But, of course, it has its challenges. The first challenge for everyone is capacity. Many of you have seen the Financial Planning Association survey on advisor stress that the vast majority of advisors don't feel in control of their time.

So, Steve knows he's got to work more. He's fine with it, right? However, when we recognize that an hour of our time is worth $1,000, it makes all the sense in the world to add staff.

But what he finds as he grows more and more is that each subsequent layer of growth adds a layer of cost. It gets more expensive to market. The more successful you are, the more expensive it becomes.

The More Successful You Are, The More Expensive it Becomes

We started out about a decade ago with Social Security Timing®, and some of our most effective advisors had radio shows. They introduced educational sections in their radio shows in order to drive new clients. They gave them free report which began the bubble. And in each city where those programs were airing, all of the sudden, we would get a whole bunch more subscribers.

All of a sudden, we had more people subscribing to the Social Security Timing. Primarily because they needed to compete in that market. So, what happened to the client acquisition cost? It went up because there were more people competing for those clients.

If you have been to Social Security seminars, you probably noticed the same thing. We started out in our library system a decade ago, and there were literally more people wanting to attend those than there were seats available. There were waiting lists all the time. Then before you knew it, there were 50 advisors in Omaha doing those same seminars.

That cost per acquisition goes up the more successful you are. So, you can think about that whole process, of looking out there to the market, as an outside-in approach to marketing. And that might be how most of us look at it. Frankly, the most successful advisors started out as salespeople. And, so, thinking from a sales mentality is that outside-in approach to growth.


So, let's talk about a second advisor. We’ll call her Rayna. Rayna's sick of the treadmill, and she wants a referral-based business. She has a very similar thought process when it comes to growth. She starts out by listening, but she adds a key step here, and this is what we've seen with some of the most successful advisors that we've worked with. She adds a build step. She adds a build step, and from that point on, it's really the same process.

But when she listens, she's not listening to strangers. She's listening is from inside her practice. What are those key, critical questions that my best clients need answered? And by doing that, she's going to build a systematic process for answering those questions. And we've seen this time and time again. Focus on that transition from listening to the client's questions, challenges, problems and build out a systematic way to answer those. That's the idea of starting from the inside. Listen not to the market. Listen to your favorite clients.

In our office, if you walk through the front door and look to your right, you're going to see our client personas on the front wall of our office. We’ve identified our favorite clients and their unique challenges. You can try this exercise in your own office with The Financial Planner’s Guide to Client Persona Development.

But that second step is where it gets very different. Build systematic ways to answer those client's questions with extended knowledge. Now, I think about the individual, the advisor who has a focus on Silicon Valley tech startups, and as a result has to deal with options all the time. So, that advisor has to be fantastic at answering those options questions.

Now,  here in Omaha, with middle income clients in retirement transition and beyond, do you think I see clients with stock options? I don't. It doesn't make any sense for me to spend effort gaining that particular knowledge

Rayna’s biggest goal is thrilled clients. It's clients that are not only walk out happy, but call later saying, "Oh, my gosh, you saved me so much money and I didn't even realize it." Because there was something in your process that reminded them to come back to you for each subsequent question.

Become Obsessive About Systematic Fulfillment

So, that's the difference between Rayna and Steve. Rayna has become obsessive about systematic fulfillment. In other words, if she's going to put a message out in the marketplace, she's going to have a mechanism for delivering better service around that message than anybody else in her community. She's become obsessive about systematic fulfillment.

I want to give you an example of systematic fulfillment. Some of you may have dealt with White Glove. They started out as a couple of advisors doing Social Security Timing seminars, and they found that they could market them through social media. This is one White Glove advisor’s results using Tax Clarity® as a mechanism. Starting with $4 million, then $10 million, then $15 million— this is the kind of growth path that you're likely to see when you actually take that build step; if you actually put together a systematic process for delivering those kinds of answers.

So, what White Glove did really well was clearly pairing the fulfillment, and answering, how can I deliver on these promises that I'm now making in my marketing. They recognized that it's not promises that they’re making, it's the questions raised out there.

In order to achieve that build step, they actually require that any advisor who's going to deliver a Social Security seminar, actually get a designation. I'm not a big believer in the variety of designations that are out there. But I am a huge believer in equipping yourself with knowledge and education.

Let me continue with Tax Clarity. So, that's just an example of success that comes when you match the fulfillment very clearly to the marketing. There are a few keys to success for adding that build step. First one is starting with your ideal client and systematizing how you answer a key question. Marketing the question and systematically delivering not the answer, but the process for answering the question. That's the key to engagement in that build step.

And if you ever want more referrals, you need more referable, when you're marketing to the question, that's what makes you more referable. So, Rayna's funnel looks very different. All the top is the same—strangers, leads, prospects, clients. Wherever her marketing comes from is from her thrilled clients. That is the major difference between Rayna and Steve.

So, we get to that market step. Rayna's process enables her to market differently because rather than marketing to the key questions that are out in the marketplace and then hoping there's some alignment with the services she delivers. She's able to market to those key questions paired with a systematic process for answering them, and that's the key difference in her marketing. Which means, her marketing can become much more stable. She's able to have a set of four messages that are always available and going out to the marketplace. The only question is, "How are they tied back to those four messages that are part of my firm's DNA?"

Her qualifying looks different than Steve’s. She's not just looking for what she can sell. She's looking to find out if the prospect that's sitting in front of her right now is similar to her best client. She's looking for whether or not the value that she built her firm to deliver aligns with the value that particular client needs. In other words, it's a “fit” conversation, much more so than a “can I sell” conversation.

Finally, her close gets so much simpler. Her close is just a demonstration of how she has solved that challenge for similar clients. Because it's not a question of whether or not there's a capability, it's not a question of whether or not they're better, it's a question of whether or not you can meet that client's need. It's so much easier as a close.

Niche Your Practice

Now, in order to do this there’s a key step, and that is narrowing the market. How many of you have seen research on niching your practice: That's the hardest thing to do, right. You're going to walk away from a 45-year-old doctor who's got $2 million? You're going to walk away from that client? It's hard, right? And maybe you won’t right away, but if you want to be the best in any given area, ultimately, you will.

So, narrowing the market, the XY Planning Network mentioned this study. A generalist advisor moves faster, but because they have to continue to have to go in that same more and more and more path, they go from 25% growth rate to a 15% growth rate to a 10% growth rate. And it's difficult for them to grow. They're experiencing what Steve has experienced.

And then you look to the niched advisor, and we see those growth rates. It's funny how closely that matches up to the advisor who used Tax Clarity as their build step, how similar those graphs look. So, that necessary step is narrowing your market. You can't build out processes to serve everyone. If you want to build, you're going to have to make systematic fulfillments a key part of how you think about your business. You have to. You can't get there otherwise. But you don't have to narrow it all at once. And I'll talk about that in just one second.


Now, turning your marketing inside out, gives Rayna one more step in this entire thought process, and that is enablement. Enablement, I think, is going to be the biggest trend of the next several years. Rather only are we focusing on the outside, it's going to be about equipping advocates to go out on your behalf, enabling them to become your marketer. And that's the new dimension that turns marketing inside out. It's enablement.

What is enablement? It's giving clear processes and visuals. So, when you think about why someone is going to refer you, it's not really that they like you, right? It's great if they like you, it’s helpful, but really, they refer you because they want to look good and they want to feel good for helping their friend.

Frankly, referrals are a selfish action. Selfish on the person who's making the referral in order to give something to their friend. So, being able to reference to a clear process when someone says, "Oh, yeah, well, why on earth would you delay your Social Security benefit?" You client can respond with, "It's just math, and my advisor walked me through everything around that.”

So, the clear processes that your client can describe is what makes you a referable. Digital evergreen content, that's, "How can I get enough content out there so that when somebody goes looking for me, they find all of the core services we provide as advisors.” Having that content out there is so good. After the referral, what's the next thing that happens? That individual who's just been referred to you goes online and checks into you. They look you up. And, so, being able to find content that reinforces the processes that you've put in place to solve exactly their question is why we need to have that content out there. Get people engaged. Then personalize your firm's specific services to address their specific problems.

So, you think about, "What does enablement do to the math?” This is a bit of an over-simplification. But just think, does anybody know what the lifetime value of one of your client's is? If not, this a fantastic exercise. If they all look different, that should be a really clear sign that you might want to focus in on the ones that have the best lifetime value to your firm.

What is that lifetime value? Because if you're able to create that build step, you're likely able to achieve only a 5% referral rate every year. A 5% referral rate, which means 1 in 20 clients refer somebody each year. You'll add at least 50% to the lifetime value, and you can think of it as driving down your acquisition costs, or you can think of it as increasing your lifetime value. I like to think of it as increasing your lifetime value, and the primary reason is that those people who are referrers, they become assets of the firm. They're like having marketing staff. And, so, increasing the lifetime value, you figure that's going to trickle in over a period of 20 years. If I have 20 clients and one of them is going to refer every year, that's spread out, of course, over the 20 years. So, it's at least 50%. But what does that number ignore? The number ignores the compounding effect of those that were just referred, and those that were referred again. So, it's at least 50%. It doesn't take much to say, "I'm going to invest in the infrastructure of my business to be able to answer client questions better than anybody else because I know that drives the lifetime value of the client way up. 

So, Steve's on a treadmill, right? If he stops marketing, he starts dying. Rayna stops marketing, and what happens? Her growth rate absolutely slows, but if you have a referral-based business, you know it doesn't stop. It just doesn't grow as fast as it possibly could. So, when you think about marketing from the outside in, your buy growth. When you think about marketing from the inside out, you're focus is on building and buying a growth engine.

Get Started

So, a few quick steps to get you started. I mentioned earlier our Guide to Client Persona Development. Focus first on your best clients. And, secondly, become obsessive about client fulfillment, and about answering those questions better than anybody else out in the marketplace. That's what our most successful advisors have done. But you don't have to do it all at once. That's the beauty of this process. You can build one key service. You can identify one key question that your best clients have and add that to your list. And if you do that over and over and over again, you will have evolved into a niche practice, and that's the idea.

This is actually how we built our business. I mentioned that I continue to work with individual clients, and Social Security Timing started out as a series of Excel spreadsheets and in our own little practice. And it ended up being the first patented Social Security optimizer and underlies several different tools represented by people who are in this room. And the whole reason was to be able to answer that client question.

Tax Clarity is all about identifying interactions between different income streams. So, when you have clients who are frustrated by taxes, you can help them visualize what you're doing for them. That is such a key out element, visualization. When I'm going to describe to my friend what you did for me, it's nice to be able to tell them you saved them $1,300 or $5,000 or $10,000 in taxes. It's a whole different thing to have a mental image stuck in my head to prompt me to remember to tell them that, to remember to tell my friend.

SmartRiskTM is all about identifying the downside risk in the investment portfolio. "If I retire, will I have to un-retire?" We're all answering that question on a regular basis. And Income InSight® brings all of these tools together under one roof.

So, ultimately, whether you already have a thoroughly defined process or not, you can start by adding one key client question. And if you serve mass-affluent clients in retirement transition and beyond, each of these software options represent a key service that you're able to deliver and actually fulfill in a way that is better than others.

Product Matchmaker

If you didn't get to try our product matchmaker at the conference, here's your chance. Answer  a few simple questions about your practice, and we will make a suggestion about which software solution is the best fit for you!

Try Our Product Matchmaker