Beyond the 12-4-2: A Dynamic Approach to Client Engagement

When someone repeats the same thing over and over often enough, it eventually becomes accepted as truth—even when it's not. This phenomenon, which psychologists call ‘the illusion of truth,’ is surprisingly relevant when considering our industry’s approach to client engagement models.

On a cold, snowy morning in Denver, I sat quietly in the back of a grand room, surrounded by the elite minds of the advisory world, all gathered for their annual top advisor council meeting. As I prepared for my keynote address, the anticipation hung in the air like the snowflakes just outside—each one unique, each one full of potential. The room buzzed with the kind of energy that made you feel something significant was about to happen, and I knew my moment on that stage could change everything.

As I waited in the wings, the speaker before me droned on and on, extolling the virtues of the so-called traditional 12-4-2 approach—monthly client contacts, quarterly meetings, and two events annually. It was the same tired mantra I'd heard countless times, a formulaic gospel that had seeped into the very bones of the industry. But something in me bristled at its rigidity, its lack of imagination. I couldn't help but wonder if there was a better way, something more dynamic and attuned to the true needs of clients. The thought gnawed at me, and the next day, I resolved to find out.

I began to ask the many advisors we coach. Not a single advisor told me the 12-4-2 model was either effective or even true. Many mentioned a book they read at some point years ago, a speaker they heard from in the past, and a so-called coach who advocated the approach. But over time, those who grew their businesses most effectively and had retention rates that exceeded 97%, all told me they learned to focus on what their clients actually wanted and needed rather than ascribing to some pre-ordained schedule.

Clearly, it was time to rethink this model – especially in light of evolving client expectations and major technology advances.

Understanding a more dynamic, episodic approach

At ClientWise, we’ve learned from the best in the business that a dynamic and episodic approach, supported by artificial intelligence (AI) and predictive analytics, offers a far more effective and personalized way to engage with clients. Rather than adhering to a rigid schedule, this more proactive, personalized approach strives to interact with clients based on significant life events and major individual milestones. Break the status quo. Consider new and different ways to engage and add value.

Using a combination of AI, data analytics, and asking clients what they want, today’s advisors are building trust, and growing deeper relationships with clients when they monitor each client’s life events (e.g., career changes, family milestones, financial windfalls, etc.) to proactively reach out with communications and services tailored to the specific needs that arise from these events, providing more targeted and relevant advice and support.

AI also allows you to analyze clients’ behavior and predict potential changes to their financial situation or life circumstances to anticipate needs and offer timely solutions. It can also identify early warning signals and mitigate potential risks before they escalate.

Instead of clinging to the outdated 12-4-2 schedule or any rigid structure that has become so routine it's lost its authenticity, it's time for a change. We need a more flexible, responsive approach that adapts to each client's unique needs and preferences. Imagine a strategy where the frequency and mode of communication are tailored to align with your client's life stages, using multi-channel engagement like video calls, messaging apps, and social media. This way, you stay connected in a manner that fits seamlessly into your clients' active, modern lifestyles.

4 keys to effective implementation

While switching to an episodic approach may seem like a somewhat radical shift, it can be implemented without needing major structural changes to your organization. All it takes are the following four modest upgrades and improvements:

1. Simply Ask: Asking clients how frequently they prefer to be contacted by you is a crucial step in building a more personalized, engaging, and relevant relationship. By understanding their communication preferences, you can tailor their outreach to align with the client's lifestyle and needs, ensuring timely and impactful interactions. This approach enhances client satisfaction and demonstrates your commitment to providing a truly customized experience.

Engaging clients in this dialogue fosters trust and strengthens the overall advisor-client partnership. To understand the frequency and type of touchpoints that would best suit a client, a financial advisor could ask the following questions:

• • How often would you like to hear from our team and me regarding your financial plan and investment updates?" Follow-up: "Are there specific times of the year when you prefer more frequent communication?"

  • What type of communication do you find most convenient and effective—would you prefer emails, phone calls, video meetings, or in-person meetings?" -Follow-up: "Are there any other communication channels, such as messaging apps or social media, that you’d like us to use?"

  • Are there particular events or milestones in your life where you'd like more proactive communication and advice?" - Follow-up: "How can I best support you during those times?"

After all, you won’t know if you don’t ask. These questions help tailor the engagement strategy to the client's preferences, making the advisor's interactions more relevant and valuable.

2. Better CRM Technology: You must integrate advanced CRM capabilities incorporating AI and predictive analytics to track and analyze client data effectively. Wealthbox, Redtail, and Salesforce Financial Services Cloud are three examples of CRM systems with AI-driven analytics that can flag significant changes in behavior and even predict life events based on historical data.
3. Enhanced Advisor Skills—More responsive outreach will require deeper emotional intelligence. Train your advisors to better understand and empathize with clients' evolving needs and concerns and ensure they are trained and equipped with the latest AI tools, financial tools, and technical competence.
4. Focused Client Education: Not only should the client be transparent about the benefits of the episodic approach and how it enhances their financial plan, but the client should also be encouraged to share updates regularly about life events and any changes to their financial goals. George Kinder, often considered the father of the Life Planning movement in financial advising said, “Life Planning is about bringing more life to the client. It’s not just about managing money; it’s about helping clients find their freedom and living the lives they were meant to live.”

When your advisory team connects with clients on this deep, emotional level, the partnership formed by inviting them to share their stories reaches a whole new level of engagement.

Anthology Capital Solutions provides a terrific example of client engagement at a whole new level. Firm leaders Armen Khadiwala and Nick Langefels founded their firm to help their clients live lives worth telling stories about. They tell clients, “Your vision is our mission.” That’s profound!

The operational benefits of this more responsive model can be incredibly far-reaching and transformative for your business. Personalized and timely engagement fosters stronger relationships and higher client satisfaction. More proactive and relevant interactions help measurably increase client loyalty and retention. And it empowers your advisors to provide more accurate and relevant advice, improving overall service quality.

In our estimation, implementing an episodic, authentic, and bespoke engagement model is one of the most worthwhile investments you can make in your business's long-term success and sustainability. It will help you stay attuned to your client's evolving needs and take advantage of AI's power to anticipate changes.

Coaching Questions From This Article

1. Considering your current client engagement model, what steps will you take to increase client satisfaction, loyalty, and retention and improve operational efficiency?
2. How might adopting an episodic approach to client engagement transform how you and your team connect with clients on a deeper, more personalized level in the future?
3. How can you leverage AI and predictive analytics to anticipate your client’s evolving needs and proactively provide them with tailored advice and support?
4. What new skills and tools do you think your advisory team will need to fully embrace a more flexible, client-centered engagement model, and how can you start developing those today?
5. How can you encourage your clients to share significant life events and updates with you more regularly, and how might this shift in communication impact the long-term success of your advisory practice?
   
   

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