Home Wealth Management Constructing a Shopper Segmentation and Service Mannequin

Constructing a Shopper Segmentation and Service Mannequin

Constructing a Shopper Segmentation and Service Mannequin


Do your purchasers dictate what sort of enterprise you’ve gotten, or does your online business dictate the forms of purchasers you serve?

Early in your profession as an advisor, you will have had comparatively few standards for accepting new purchasers. The extra property you can collect, the higher! However as your agency and repair providing have matured, you and your crew might need assistance managing the e book you’ve got constructed. Have you ever ever gone again to evaluate whom you are working with and the assets and time they require of you?

One methodology that would allow you to redirect your vitality towards the proper folks and actions—and create extra room for progress—is constructing a consumer segmentation and repair mannequin. This is how.

What is the Make-up of Your Guide?

Step one in constructing a consumer segmentation and repair mannequin is to grasp the folks in your present consumer base. Assume by way of each quantitative standards (e.g., property below administration and income generated) and qualitative elements (e.g., degree of belief, coachability, and referral historical past).

Additionally, think about what you do for them. Does everybody presently obtain the identical providers, equivalent to a monetary plan, an annual overview assembly, common outreach, and invites to consumer occasions? (Trace: If the reply is sure, put together for a change!)


Separating your purchasers into segments based mostly on clearly outlined standards and figuring out the providers you may ship to every one can assist enhance capability and construct scale.

A Technique for Shopper Segmentation

After you have a greater understanding of your present purchasers, it is time to begin categorizing them. There are lots of methods advisors can method consumer segmentation. The secret’s to search out the one which works finest for you and your online business, which suggests having a imaginative and prescient to your agency and the perfect purchasers you wish to work with.

It’s possible you’ll be aware of the segmentation method that locations purchasers into classes labeled “A,” “B,” “C,” or “D” based mostly on both income or AUM. Whereas this quantitative method helps to establish your most worthwhile purchasers, chances are high you already know these purchasers properly. So, what about the remainder of your e book?

Commonwealth’s Enterprise Consulting crew usually recommends our advisors use a extra holistic segmentation methodology known as the “ABSLN” methodology.


With the ABSLN segmentation methodology, you continue to establish your high purchasers as “A+,” “A,” or “B” based mostly on the income they generate to your agency. For the underside tiers, although, you may use qualitative standards to position purchasers into segments labeled “S,” “L,” or “N.”

  • S/Strategic: People on this tier have the potential to turn into excellent purchasers. Contemplate younger, excessive earners with sturdy financial savings, enterprise homeowners with illiquid wealth, or HENRYs (excessive earners, not wealthy but).

  • L/Legacy: These purchasers might have a legacy relationship that justifies offering continued service—for instance, “A” purchasers’ youngsters, widows, or private pals.

  • N/Non-ideal: These purchasers don’t match into another segments. For them, you can proceed providing service, switch them to a junior advisor, or discontinue your relationship.

This method gives deeper perception into the sorts of purchasers presently in your e book, which you’ll then use to establish the forms of providers you may ship to them.

From technique to motion. Lately, I labored with a Commonwealth-affiliated advisor on some capability points. They have been questioning whether or not to rent a service advisor to handle the underside half of their e book. Collectively, we used the ABSLN methodology to phase their purchasers and analyze how a lot income every tier introduced it. It shortly turned clear that hiring a brand new advisor would value them way over the property being managed. So, the advisor determined it would not make monetary sense to rent assist in that space.

Through the use of this evaluation, although, the advisor realized that lots of their current purchasers fell into the “non-ideal” class. They determined to cut back the providers they offered to that group and have been capable of unencumber a while, which was their unique objective.

Pairing Segmentation with Companies

As soon as you’ve got completed the consumer segmentation train, you may transfer on to constructing your consumer service mannequin, the place you may establish which providers you may ship to every phase—and the way usually.

If you happen to’re like many advisors I work with, you will have your providers mapped out in your head. However belief me, it is price documenting them. Like with different processes, clear documentation will assist be certain that you persistently provide high-quality service.

To assist with choices about service choices, mirror on these questions:

Your objective is to create a persistently excellent expertise for the purchasers in every phase and to reduce any exceptions.

The typical Commonwealth advisor generates solely 9 p.c of their whole income from the underside 50 p.c of their consumer base. So, though it could sound apparent, strive spending most of your time on segments that generate vital income and fewer time on people who don’t.

Take into consideration what number of hours you may have to decide to delivering varied providers, and make sure you think about time for enterprise growth and apply administration actions.

The appropriate agency associate can recommend choices for delegating sure duties. At Commonwealth, we’ve helped advisors optimize effectivity by a spread of outsourced enterprise options. For instance, some advisors outsource a single tier’s funding administration actions whereas persevering with to handle portfolios for different segments.

If you want to unencumber capability, establish non-ideal purchasers and, if doable, refer them to a special advisor to melt their transition.

Your outcomes may begin trying one thing just like the under grids, with all providers—together with funding administration, monetary planning, advertising initiatives, and consumer occasions—on the left and the tiers which may be eligible for every service on the proper.

If the overall variety of hours you may spend to ship service throughout every consumer class would not align with the common income earned from that class, it’s possible you’ll want to regulate.

  Shopper Tier
A+ A B S L N
Evaluate Conferences            
Proactive Outreach            
Funding Administration            
Monetary Planning            
Particular Experiences 
(e.g., consumer occasions, milestone recognition)
(e.g., 401(ok) overview,
CPA and legal professional collaboration)
  Shopper Tier
Evaluate Conferences 1 in-person assembly per yr (deal with matters related to youthful purchasers: wealth accumulation, paying off pupil loans, shopping for a home, planning for household wants)
Proactive Outreach 3 extra textual content messages and/or Zoom conferences (vs. cellphone/electronic mail)
Funding Administration Outsource to agency associate’s managed account answer
Monetary Planning Use extra turnkey monetary planning software program, reserving extra customizable choices for “A+,” “A,” or “B” purchasers
Particular Experiences 
(e.g., consumer occasions, milestone recognition)
Items for all times occasions (e.g., new house, trip, new little one)
(e.g., 401(ok) overview,
CPA and legal professional collaboration)

401(ok) overview

Actively check with CPAs/attorneys keen to interact with youthful purchasers

Assign new HENRY purchasers to agency’s next-gen advisors


Cost commonplace funding administration charges in keeping with “A+,” “A,” or “B” purchasers

Cost annual consulting payment to strengthen the worth of proactive monetary planning

In fact, there’s no magic quantity for what number of consumer conferences to carry annually, and the variety of choices will differ by advisor. Determine what you may present your purchasers whereas additionally being aware of your capability.

Now What? From Technique to Motion

You’ve got segmented your purchasers and created a service mannequin. Now, it is time to implement your technique in your apply. This implies systematically evaluating each facet of your online business to determine the place to make changes.

Listed below are some questions to contemplate:

Instance: If you happen to meet with “B” purchasers much less usually than earlier than, it’s best to alter your scheduling course of.

Instance: Be sure everybody understands the right way to onboard purchasers at completely different tiers.

Instance: If you happen to’ll be outsourcing funding administration to your “strategic” purchasers, be able to share why you are feeling that is the proper transfer for them.

Instance: Maybe you share the identify of one other advisor who could be a greater match for them.

Instance: Relying in your CRM system, you could possibly arrange workflows and add different key standards in every consumer’s document.

By aligning every space of the enterprise together with your new service mannequin, you may be higher positioned to draw extra excellent purchasers and scale your online business.

Prepared for a Change?

When you do not have a deliberate consumer segmentation and repair mannequin, your purchasers can find yourself dictating how your online business runs. Why not strive a special method? In any case, providing your purchasers a terrific service expertise should not come on the expense of your personal enterprise’s progress.

Taking time to finish these workout routines permits you to focus your vitality the place you want it most. The profit is extra time to handle extra relationships—primarily with excellent purchasers. Plus, you’ll be capable of help elevated income with fewer assets, which suggests extra revenue heading on to your agency’s backside line. And that is a win-win.



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