The Do's and Don'ts of Client Events
HInt - The Biggest One has to do with who has the Microphone
One of the things I said when I first started the B2Bahnsen substack is that I would only be sharing what has worked for me – I would never present anything as “the only way to do something.” Now, there are certainly things I have done that I feel really, really strongly about, but I very meant what I said. The financial advisory business is a very a big business, and there are a lot of practitioners who have been successful, and sometimes they have done different things to get there; and sometimes they have even done contradictory things to get there. In other words, there may be more than one way to skin a cat. If I were interested in writing a substack on all the ways people have been successful in this profession, I would do so. But alas, I am not (more than being disinterested, I just wouldn’t really know how to do that). What I can share is what has worked well for me and my team at The Bahnsen Group, and so far I have really enjoyed writing the posts I have shared, and greatly appreciated your seeming appreciation for them. At various points where I feel like things are normative (for example, “always be client-focused” is not really a subjective take that has worked well for TBG – it is a pretty objective universal for our business) I will say so, but for that larger category of things that are truly meant to be “how I did it – for whatever it’s worth,” I think you’ll discern on your own what, if any, value it has for you.
And this week’s topic is very much in that vein, as I am 100% certain many advisors have done this differently and yet been successful in their own way. This topic, is that of hosting client events.
It’s important for me to lead with how subjective my way of doing client events is because I am probably going to sound really opinionated, very quickly. But I am not pretending when I say that I fully recognize how others have done this completely differently and it has worked for them – so don’t let my strong tone get to you. I am writing about what has worked for me, and that’s it.
So here is my first rule when it comes to client events: Never, ever, ever let anyone speak, but you.
Whoa. Wait a minute. Isn’t this the exact opposite of what many do? Isn’t the key to a great client event having a money manager, or a wholesaler, or some brand name person from your firm speak? Aren’t their subject matter experts who can come in and blow the socks off of your clients and prospects with their knowledge and experience? Why do firms invest so many resources into client events leveraging the intellectual capital of the firm if you are supposed to be the star? And isn’t it worthwhile to show that you are the host, the connector, the coach, the integrator, and by putting other people on the stage with you, it actually reinforces you as a generalist with a vast array of talent around you or behind you?
Meh. I’m not buying any of it. I know some have done it. But I believe it is a huge missed opportunity, possibly counter-productive, and always sub-optimal relative to what the single greatest point of providing clients and prospective clients an open bar, sea bass, and filet mignon. To demonstrate competence and likability. (Remember??)
I believe that client events work when the people there (clients and prospective clients) leave with a distinct impression of you – of your convictions, of your beliefs, of your seriousness of purpose. I cannot say how that gets done when all you are is an opening act, an emcee, and/or a bill-payer. That reinforces you in a way that may be sub-optimal, if it reinforces you at all; it might possibly cause you to be forgotten all together. There are a couple things that can happen when you allow a money manager (or God forbid, a wholesaler), to be the main event at your client dinner.
One possibility is that the guest speaker bombs. I would say this has a 70% possibility of happening, and for those who have forgotten risk-reward trade-offs, that is very bad math. Many money managers are dry, numerical, repetitive, and charmless – and those are the ones I like! But another possibility is that the manager crushes it – there is wit, humor, engagement, all good things. Even in that case, how does it benefit the advisor? That good will and those good vibes do not accrue to the audience growing in appreciation of your competence and likability, and some part of your value proposition just got defined in an inter-connection to a particular money manager – one who could be gone in three months (i.e. they leave their firms all the time; you choose to use a different manager in the future; or any other number of possibilities that render that speaker choice a bad idea).
Whether the speaker does a good job or a bad job, there is limited upside for the advisor in connecting with the audience, and connection with the audience is the whole point of the dinner event. Indeed, connection with clients and prospective clients is the whole point of our business. Building and maintaining trust is our calling here on earth. I am not suggesting that there is no limited vehicle to do this with a guest speaker, but I am suggesting it is just that – limited.
But even apart from what can go wrong (a bad money manager speaker, a good money manager speaker who captures your value proposition, a wholesaler talk who, shall we say, isn’t singing from the same hymnal you are are about fiduciary duty, etc.), there is a massive opportunity cost that has to be discussed. You have successfully done in setup for this event what can only be described as “very low-hanging fruit” for business development success: You have filled a room with people, you have presumably selected a venue that speaks to the class and style you carry your practice with, and you have arranged for a captive audience to hear you talk with a microphone and a podium. In other words, you have a bully pulpit, which is a not nice way of saying you now have some moral authority – some gravitas – a ball teed up in the good grass – and you are going to hand it all off to someone else? I am sorry, but I can’t for the life of me understand why this would be a good idea.
And the reason why? You surely have something to say in your own voice. You surely have convictions that got you into this business to begin with. You surely have a point of view, an investment philosophy, a daily passion around what you do for clients, a process that is differentiated and unique, an ability to preserve wealth and create value – that absolutely deserves to be shared. And you must have a voice with which to do all this. Why would you mute yourself, and turn on someone else’s TV, even if you technically brought that person to the event?
There is no greater way to build client trust than for clients to hear your convictions, demonstrated likably and with the competence that surrounds your daily endeavors. There is no greater way to add to your pipeline of new business than for new prospective clients to participate in this public demonstration of conviction and trust-building. Adding in a delicious duo of sea bass and filet is just icing on the cake – the entire deal comes down to you commanding a microphone, and not outsourcing the secret sauce – not the sauce on top of the protein, but the secret sauce of your ability to authentically share your point of view. These events are powerful opportunities, if you let them be.
There are a lot of other best practices worth sharing as well. I believe many advisors built something out of doing all-prospect events – that is, event after event where they did mailers or whatever else to get guests there, and they filled up the seats with visitors, many of which became a part of their pipeline, and many of those who presumably became clients. Again, I cannot speak normatively to what is best for everyone, but I never found that to be the most effective strategy. For years upon years upon years, I did quarterly dinners that were for CLIENTS. I had nothing to sell, no product to discuss, and no gimmick to offer. I was just there to discuss the market, the economy, my point of view on current affairs, and to do so authentically, in my voice. I wanted to dampen media hype, not lean into it. I wanted to emphasize the wisdom of what we are already doing (why else would we have been doing it?), not pivot to an “act today to save your portfolio” BS message. And did I mention, I wanted to demonstrate competence and likability. So I did two things that almost instantly turned these events into wild success stories for me and my business:
I devoted about 30-40% of the time to a wide open, no holds barred, Q&A. By the time dinner was done and before the crème brulee hit the table I was in open season Q&A, and we would go all over the map topically (wherever guests took things). It provided me a chance to be quick on my feet, to demonstrate versatility, and to reinforce confidence that I knew my stuff. And I loved it (still love it).
I filled the room roughly 70-85% clients, with roughly 15-30% prospects. This was the secret sauce. Many advisors can’t do this. They tell themselves, if I am going to go to the trouble and expense of these events, why would I sink so much cost into people that are already clients? This is a terrible way to think! The reason is that when you surround 15-30% prospects with 70-85% clients who love you, who believe in you, who are a part of your business and operation, you have created a home-turf advantage that is unstoppable. I do not believe I am exaggerating to say that over 80% of those “prospective clients” (i.e. guests) who attended these events over the years became clients. This mix of clients and guests all at once built rapport with clients, added value, gave sticky and meaningful content to those who paid us a fee for sticky and meaningful content, and then pragmatically provided a venue for a soft, passive, non-threatening, non-salesy way of demonstrating competence and likability.
Come for the wedge salad, stay for the formation of trust.
I did a lot wrong over the years, I am sure. In my rookie year I spent about three months of trainee salary to charter a yacht around Newport Harbor to talk 529 savings plans, and had one person show up. I booked the wrong venues. I tolerated people drinking way too much at events and being a distraction to the serious people who were there. I could go on and on. I made mistakes.
But overall, over the years, these events have been inseparable from the core building of our business. We now have offices in ten different U.S. cities and we do at least one client dinner event (with 10-20% guests, of course) in each city, every year. I will do this until they carry me out. As long as I have something to say, I want to say it in my own voice. And paying for dinner gives you an ability to do some powerful things. As Ronald Reagan once said, “I paid for that microphone.” Well, when you pay for the microphone, you may as well put it to use.