I’ve spent a career coaching retirement advisors on ways to improve client retention and referral rates for their plan sponsor clients. What I’ve learned is that unlocking the secrets to sponsor satisfaction is critical for successful practices, and this DC viewpoint provides the keys.
To improve satisfaction, you must ensure what you’re doing matches what they expect of you. I can break this down into three simple things you need to know:
The good news? Our research unlocked all of these secrets and you can get them in our Formulas for Satisfaction guide. For some of the main takeaways and action steps you can apply today, read on.
We asked plan sponsors which qualities they valued most in their advisors. The clear winner was effective communication. Here, in order, are the top three qualities most valued by plan sponsors:
Improving your communication seems like low-hanging fruit for managing your practice. However, the results from our survey suggest that this quality was extremely important and thus may deserve greater attention. You can easily use tools and calendars to help you become an excellent communicator, but here are some additional ideas that might help.
Be proactive in reaching out to your clients, and be sure to keep a log of each of these relationship touches so that you can readily see if you are reaching out consistently to all clients across your practice versus only a select few. You may want to share plan insights highlighting the benefits of automatic enrollment or participant education, for example.
Compliance and regulatory issues are important to plan sponsors, so be sure to communicate critical dates and fiduciary requirements in advance to plan sponsors. Our program can walk you through how to use annual calendars to error-proof these types of communications for each of your plan clients.
And finally, demystify plan activity for each specific audience. When talking about investments, for example, you can provide an exquisite level of detail for the plan’s investment committee and a broader, more accessible overview for participants. Always seek to match the level of understanding of your various individual audiences.
We also learned the top three advisory services that sponsors considered most important to their plans and to their relationships. Here are the top three services most valued by plan sponsors:
To illustrate the value of the advisory services you provide, you can track the performance of funds in a plan’s lineup, popular peer funds, and funds on the watch list.
Consider analyzing funds’ style consistency, performance consistency, and expenses so you will be prepared to recommend replacements for funds that fail to meet standards set forth in a plan’s investment policy statement.
Finally, plan sponsors don’t always understand the implications of their fiduciary responsibilities. Offer training, and show them how you can help. Don’t forget to document the time you spend providing these services each year.
Finally, we asked sponsors about the qualities and services provided that caused an advisor to stand out from the herd. Here are the top three services that sponsors believe differentiate the elite advisors they choose to work with:
Our aha moment here was not that advisors aren’t engaged with their clients’ plans. You are! The aha is that sponsors may fail to recognize the level of your engagement. So add a step to your service model to summarize what you did and why it was beneficial to the plan and to the sponsor.
Demonstrate the specific value you bring and show that you are committed for the long term to the smooth and successful operation of the plan. Think of this as the documentation you might prepare for an annual performance review, but in this case, your boss is each client.
We suggest using calendars, checklists, and summaries to illustrate your attention to plan details and show your dedication to regulatory and fiduciary responsibilities. These tools will build confidence that you are attentive to requirements. Our program offers templates and samples of all of these tools.
The top goal of plan sponsors for four years in a row1 was participant education, so be sure to create a participant education plan and offer instructional plan communications in a language that participants will understand and respond to.
To unlock the secrets to sponsor satisfaction, understand what sponsors expect of you and then do it. You can start today by paying attention to these three things:
Why is this so crucial? Because your success depends on it. Higher sponsor satisfaction helps you strengthen existing relationships, which in turn helps you cross-sell other products and services, retain clients, and get referrals for new business.
When you can show a one-to-one match between what your sponsors are looking for and what you actually provide, you are on the way to creating greater satisfaction among your plan sponsor clients.
Ron Cohen is head of defined contribution investment only (DCIO) sales for Wells Fargo Funds. He has more than 20 years of defined contribution experience at various firms, including Wells Fargo Funds, J.P. Morgan, and DWS Investments. He is known for his innovative approach to the DCIO business, his partnership with recordkeepers and advisors, and his commitment to helping them deliver value.
Wells Fargo Funds surveyed plan sponsors about their advisor preferences and built The Science of Satisfaction program.
The Science of Satisfaction program provides the keys by pairing research insights with action steps and downloadable tools and templates.