Chapter 1 Elements of Relationship Marketing The purpose of using acquisition, retention and cross-selling is to maximize your profits by incorporating

all three in relationship marketing. The first step acquisition is attracting clients; you then have to build a relationship with them that ensures you keep them and in return provides an opportunity in the future to cross-sell. A practice that uses relationship marketing thus understands each strategy in terms of its effects on the other strategies and its contribution to client satisfaction and value. In my practice initially focus would be on acquisition, trying to attract potential clients. Once this has been achieved building relationships with the existing clients is vital as it is an opportunity to cross-sell and it is cheaper retaining an existing client than finding a new one. You will always seek new clients but when your existing clients are happy they will give you more business by taking new products from you as their needs grow as well as referring friends and family to you. Your client will no longer see you as just their financial advisor but as a good friend to, and it will be very difficult for another advisor to take over your clients portfolios. Retention will be achieved through good relationships with your clients and your acquisition process will be easier and more cost effective as you are getting referring by word of mouth through your existing clients who already marketed you and the products available. By using all three strategies in relationship marketing ensures you are best utilizing your clients and thus placing value on them. Your clients are not only seen as just people, but an investment that will reap returns. This can also be seen as a long term investment and you cant expect returns overnight. In my practice I would incorporate all three strategies and interlink them in order to build relationships ensuring effective relationship marketing. Chapter 2 The Importance of Client Relationships In practice it is important to allocate certain tasks to specialists in your practice. You can no longer run your business by trying to manage everything in your business in the fear of losing clients. The best way

to retain clients is making sure all their needs are met and the only way to achieve this is to allocate different tasks to specialist in your office. In the business specialized people need to be employed, you need data capturers, administrative staff and financial planner specializing in specific areas. A relationship marketing specialist is also a must have as he/she will ensure that relationships are always healthy and can deal with all complaints from the clients and provide resolution to the complaints. By having specialists in the business you are essentially adding value to the business and in the event of an unforeseen incident happening to the advisor, the business may still continue. If the planner was the only person in the business and becomes terminally ill the business will cease to exist as the business is dependent on the advisor. By employing specialists the advisor may also resell the business at retirement as the clients have relationships with everyone in the business and future dealings with existing clients may continue, this would have been difficult if the advisor is a one-man business. In my business everybody has a specific task, I go and see clients and build relationships with them, there is a person who makes appointments with the clients, and there is a person who seeks leads on a continuous basis. Everybody contributes to make the business a success, the relationship marketing specialist ensures all problems are resolved and if a client needs short term insurance they can speak to a colleague that specializes in the short term insurance industry. By having all these services to our client I believe that we are adding value to the service we provide to them and they can have peace of mind that our business is here to stay and that our service wont be compromised in any way. I think it can be concluded that the best way to operate a financial planning practice in todays environment is to diversify all requirements into specialized areas where trained staff can effectively deal with queries and needs of our clients; this will ensure that the client will remain our client and a positive marketer for our practice. Chapter 3 Managing Client Relationships *My target market is young professionals furthering their careers and buying their first homes. They are engaged, married and planning to have there 1st child, or still single. They have some sort of tertiary qualification.

Information hunt worksheet Products/needs The financial needs of my target market include life cover, investment vehicles and retirement annuities. The employers of the people in my market dont provide investment vehicles and in regards to the other benefits that they do provide it is most of the time insufficient to cover the clients needs. Price Prospecting My market needs investment vehicles most. The premium my clients will be able to afford is a minimum of R300 per/month. Prospect will be approached at their final year at varsity or college. This will ensure for a continuous data base of students in their final year of studies and contact will be made on a continuous basis to build a relationship, contact will be birthday cards and wishes till the following year where a full needs analysis of clients financial situation can be done as the Training client should have started working. I am trained in all aspects of the business, but can acquire a certificate in financial planning to make sure my knowledge Promotion Resources Goals is impeccable. Damelin offers various marketing aids that may assist. Special needs packages Products and packages for specific markets Slides and scripts for seminar selling Market information The financial institutions will provide access to resources as well as the tertiary institutions. High level of activity will be needed to maintain this market Chapter 4 Managing The Client Life-Cycle disability, dread disease benefit, education policies,

A prospect needs to be recognized as someone who has high expectations and if this expectation is not met they will not have any dealing with you. If these expectations are exceeded the prospect will then make the first purchase. Trust is normally absent when you meet a prospect and you would need to gain their trust, the prospect also needs to perceive you as credible in order for them to trust you therefore you would need to know what you are talking about. Prospects have an image of the company you represent as well as the products of the company, you as an advisor would need to act appropriately to meet the image of the company so that the prospect can identify you to the company or product. With a prospect you need to discover needs, wants and values as if it is your client you know their needs, wants and believes. You will need to be enticing with a prospect creating curiosity and grabbing their attention; they should want to know more. In practice the hardest thing is to set an appointment with a prospect, once that has been achieved and you meet the prospect you will need to build rapport. You will also need to keep everything simple and transparent in order not to confuse the prospect. With a client there is already a relationship and you already know the likes and dislikes of your client and it is easier to approach them. Core clients are supporters and purchase one or more products from you every two years. The service you provide meets their requirements and values and even if they have a disappointing experience they will continue to support you, this is not the case with a prospect as he will lapse his policy almost immediately. Due to the fact that you know your client you will approach him in the manner most appropriate to the situation and your approach will vary from client to client. The approach towards a prospect and a client will be very different as you do not know the prospect and need to adjust to them, while on the other hand approaching your client will be much easier as you already know your client.

Chapter 5 Ethics In Financial Planning

Question 1 1.1. Ethics are morals and determine how individuals as well as corporate bodies should act and behave. To behave ethical means that you should not harm the interests of others and emphasizes on the good that can be achieved. 1.2. As a financial advisor we must provide professional services with integrity. We must also be honest at all times, meaning that we cant make false projections just to get the clients business. Lastly we need to remain objective, we cant force the client to place his business with a company because they will pay us more commission. The client must choose which company will be the best for him. Question 2 If you become aware of a fellow financial advisor not acting in accordance to the FPIs Code of Ethics and Professional responsibility you must promptly inform the Disciplinary committee of the FPI. The FPi does not need you to disclose information or reporting based on knowledge gained as a consultant or witness. Chapter 6 Compiling a Marketing Plan The master plan: Step 1: Understanding the market place My target market is students, the emerging middle class and successful individuals. Due to the fact that trends are set so easily and that so much is happening in our industry it is imperative that we understand what factor can influence our businesses. Firstly interest rates are on the rise to counter inflation and try to encourage individuals to save, this is and opportunity for our client to invest in endowment policies but we need to take in consideration that when interest rate rises clients cash flow is affected as they will pay more on there bonds and car repayments. We also need to take inconsideration laws that govern our industry. Stricter measures where implemented

to control fraud and money laundering and Fica requirements ensure that that advisors are accredited. The HIV epidemic is definitely one that affects our industry as life insurance companys may not discriminate against HIV positive people. This in result changes the cost for insurance policies. Understanding your market place prepares you for changes in the market place that gives you the edge on your competitors and you can tailor make your service to benefit your clients and meet their needs. Step 2 Setting out target Segments Our companys focus is to offer good customer services and to satisfy our clients needs to the best of our ability. We pride ourselves to be the best in the industry and add value added service to our clients. Our target market we will focus on the higher LSM groups, students, young professional and the middle income market. The demographics will be in the north and west of Johannesburg. Our clients will have some form of tertiary education and will most likely to own a property. They are looking at starting a family or just started a family. They are career driven individuals that want to protect what they have build and want to create wealth as well. Step 3 Personal marketing objectives Our short term goals are to attract clients from a specific market segment. Our clients must range from age 21 to 45. They must be professionals, doctors, lawyers, engineers, teachers, lecturers, plumbers and small business owners. Their income must be from R10 000 per month. Our medium focus is to retain our clients, and start building relationships with them and in the long run we want our clients to refer us to their friends and family that is in the same social economic stance as them. The 7 Ps

Product: I will be marketing a range of product available in the industry, life insurance, investment and medical aid. This will allow my clients to make a choice and choose a product that meets their needs. Price: I will work on a commission bases. Promotion: promotional material from our service provider will be supplied and given to the client. We also want our client to promote our business by word of mouth. Place: our offices will be based in Randburg giving accessibility to clients in the West rand and well as the North of Johannesburg. People: our target market is professionals, doctors, lawyers, engineers, teachers, lecturers, plumbers and small business owners. Their income must be from R10 000 per month and residing in the northern and western suburbs of Johannesburg. Process: admin staff will run the back office and ensuring all documentation in terms of Fica and Fais are met. They will do all processing of cases with the service provider. All systems will be in place for the admin staff to perform their duties as well as a filing clerk to store all documentation. Physical evidence: stats will be drawn weekly and analyzed. The 4 Cs Customer Value: Tailor made service satisfying all their financial needs. Cost: commission based. Convenience: due to the demographics clients are easily accessible. Communication: out of sight, out of mind we want to stay in touch with our clients. Everyday a sms will be sent to our clients with the market news and investment, this will be general information, the rand/dollar rate ect. Step 4 Action plan and resource allocation Firstly our premises need to be established. We will then start reworking our clients and start making appointments to see theses clients; existing clients will need to be serviced. Up selling and cross selling is imperative as it is cheaper than acquiring a new client.

Innovation is important so new ideas can be implemented allowing staff to grow and creating an exciting environment. Make sure everybody understands the primary objective in the business and keep our clients happy. Step 5 Monitor, Control and Review We will measure actual business against targets set. We will also setup a revenue control budget to determine time cost per hour. At the beginning of each week we will asses the previous weeks business and try to determine if we were on par and if not what went wrong and then set up plans to rectify mistakes made. Making sure that all staff performs their functions effectively and key performance indicators can be set up as a measurement tool.