by Bryce Sanders, President, Perceptive Business Solutions Inc.
Does it seem everyone is moving upmarket? There’s a case to be made for building a clientele of HNW individuals. More money often means more problems. You build a small clientele of wealthy people, help meet many of their needs and make their lives easier by providing great service. The tough part is finding these people and winning them over.
You could prospect. Find prospects who will listen, learn about them and determine if they fit your criteria. It’s the bottom up method. It takes lots of time, plus it’s extremely difficult saying “You’re a great guy. I can see you have needs, but I’m afraid you are too small.” You would never do that.
The top down strategy means you identify prospects within the wealthiest 2-5% of your local market, become part of their world and discuss business if and when the time is right. The advantage is prequalification. Their stature and profession indicates they are likely quite wealthy.
Here’s your route in. When people get to a certain level of success in their lives, they often give back to the community. It’s the right thing to do. Also, raising your visibility by doing good works is good for business. The community organizations they join aren’t necessarily yacht and golf clubs. They are museums and cultural organizations, social service charities, their school alumni association and more.
As an advisor seeking to mingle with HNW individuals (in addition to giving back yourself) you want the organizations you choose to have four characteristics:
1. Attract HNW individuals. Sure, the theory is good, but you want to confirm they are really there! Museums and cultural organizations often produce annual reports, just like public companies. They usually list donors in tiers. Ideally you want an organization with many names in the $ 1,000 (and above) giving categories.
2. Opportunities to meet them. Joining doesn’t help your mission if they have only one meeting a year. The ideal organization puts a couple of hundred people in a room once a month. Think about opening receptions when your local museum unveils a new exhibition. In today’s world of philanthropy, many donors are very active. They want to see how their money is being spent. They show up.
3. High visibility. Suppose you are at a party. The talk turns to plans for the weekend. You explain you are attending the monthly meeting of the Horological Society. What? Never heard of it. Does it deal with plants? No. That’s the Horticultural Society. My group is for people who collect and appreciate fine watches and clocks. You want an organization with instant name recognition.
4. Positive impression. When it comes to politics, it’s an unfortunate reality that many people are polarized. If the community is evenly divided on an issue and you have a high visibility role on one side, many people in the opposing camp would never do business because your views are counter to theirs. You can be support any cause you choose. However, if your goal is to raise your visibility, try to choose organizations that aren’t controversial.
Where does passion fit in? This is an issue that makes many people hesitant about joining their local art museum as a member. They think the room will be filled with art historians who will subject them to pop quizzes. “In which order were Picasso’s Blue, Rose and Cubist periods?” That would be scary.
In reality, these museum receptions draw car dealers, printers and other business owners. Lawyers, judges and doctors attend too. You’ll find corporate executives in attendance. In one way or another, they are all giving back to the community.
Let's say museums are not for you. You are a wine fan. You are hesitant about joining the local wine and food society because everyone will know much more than you. Not a problem. In the world of the art and music (wine too) people are eager to share their passion with people who have an open mind and a sincere desire to learn. Be yourself, but study up a bit. Try not to ask questions like: “Who’s Picasso? Is he a local artist?”
Never join an organization for the single purpose of getting business. They can smell that. There are two exceptions, chambers of commerce and networking groups. Getting business is the reason for joining. But if you join the local Jaguar car club and you don’t own a Jaguar and can’t drive a stick shift, they will wonder why you are there.
Here’s a simple strategy. Join four organizations. Give each one night a month. Try to meet six new people every time you attend. Say hello to the people you met at previous meetings. You will raise your visibility. People will get to like you. Many people choose to do business with people they like.
Bryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, “Captivating the Wealthy Investor” can be found on Amazon.
