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Segment today profit tomorrowJohn Joe McGinley

Business Strategy Manager

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Who am I?

Not a jockey

23 years experience

Standard Life

Abbey Life

Scottish Life

Aegon

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Are your clients your clients?

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The power of seven

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Wanna tell you a story

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Time dominated by prospecting

Many unproductive clients

Generalist

Variable investment capacity

Falling margins

Lack of capital

Variable IT capacity

Variable adviser productivity

Poor service definition and delivery

Time dominated by closing sales

Fewer clients 80/20 profit rule

Specialist

High investment capability

Predictable and healthy margins

Stronger capital base

IT – driven

All advisers productive

Clear service definition delivered consistently

Current intermediary Future intermediary

Transition time: 2 – 3 years

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Why plan?

Planning will help you:

shape your thoughts

think through scenarios and implications

ensure points aren’t missed

target the correct market

identify opportunities and weaknesses

identify your own personal goals and business vision

understand your customers, highlight potential customers and how to attract them

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Develop understanding and insight within your customer base

Focus on groups of customers who will bring you the most income

Understand how they would like to be treated

Satisfies many aspects of TCF

Many IFAs have seen greatly increased profitability

Why segment?

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Age bands

Geography

Free assets

Attitude to risk

Life stage

Financial objectives

Combinations/Complex segments

Segment your customer base

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Characteristics of ‘good’ segments

Specific

Measurable

Large enough to be viable

Profitable

Differentiated

There’s no right answer!

High net

worth

High-end affluent

‘Mass affluent’

Aspirational

Segment your customer base

Many clients could be in a segment you no longer want.

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Define a service strategy

Define a marketing strategy

Remuneration model

Many firms segment and then stop!

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Example proposition matrix

High net worth Affluent Aspiring

Charge basis Flat fee Lower fee and bespoke

Bespoke

Key services Full wealth management

Focused financial planning

‘Product-led’

Face-to-face? Quarterly Annual As required/ chargeable

Telephone Dedicated helpline Generic helpline No telephone support

Email / Web ‘Personal’website

Offered Mandatoryself-service

Client reporting 6-monthly full financial plan

Annual review Review on demand

Etc…

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Ask yourself 4 key questions

What problems do I solve for customers?

Why should people buy from us?

What benefits are you offering that the competition do not offer?

What makes us different?

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What should your segmentation look like?

Who do you sell to now?

Who do you want to sell to in the future?

What do your clients want from you now?

What do clients want from you in the future?

What will your business look like?

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Key Fact

“The products and services that succeed are those that offer a benefit to consumers ….

That is greater than the perceived cost.

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Example proposition matrix

High net worth Affluent Aspiring

Charge basis Flat fee Lower fee and bespoke

Bespoke

Key services Full wealth management

Focused financial planning

‘Product-led’

Face-to-face? Quarterly Annual As required/ chargeable

Telephone Dedicated helpline Generic helpline No telephone support

Email / Web ‘Personal’website

Offered Mandatoryself-service

Client reporting 6-monthly full financial plan

Annual review Review on demand

Etc…

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Your Proposition Matrix

What segments do you want?

What charges?

What contact?

What technology?

What markets?

Anything you want?

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Business brain

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Remember

www.aegonse.co.uk/businessbrain

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Any questions?