Constructing a Consumer Segmentation and Service Mannequin


Do your purchasers dictate what sort of enterprise you’ve, or does your corporation dictate the sorts of purchasers you serve?

Early in your profession as an advisor, you might have had comparatively few standards for accepting new purchasers. The extra property you possibly can collect, the higher! However as your agency and repair providing have matured, you and your crew could need assistance managing the e-book you’ve got constructed. Have you ever ever gone again to evaluate whom you are working with and the assets and time they require of you?

One technique that might enable you to redirect your vitality towards the fitting individuals and actions—and create extra room for development—is constructing a shopper segmentation and repair mannequin. Here is how.

What is the Make-up of Your Ebook?

Step one in constructing a shopper segmentation and repair mannequin is to know the individuals in your present shopper base. Assume by way of each quantitative standards (e.g., property beneath administration and income generated) and qualitative components (e.g., degree of belief, coachability, and referral historical past).

Additionally, think about what you do for them. Does everybody presently obtain the identical providers, akin to a monetary plan, an annual overview assembly, common outreach, and invites to shopper occasions? (Trace: If the reply is sure, put together for a change!)


Separating your purchasers into segments based mostly on clearly outlined standards and figuring out the providers you will ship to every one may also help enhance capability and construct scale.

A Technique for Consumer Segmentation

After you have a greater understanding of your present purchasers, it is time to begin categorizing them. There are a lot of methods advisors can strategy shopper segmentation. The bottom line is to search out the one which works greatest for you and your corporation, which implies having a imaginative and prescient in your agency and the best purchasers you wish to work with.

You could be acquainted with the segmentation strategy that locations purchasers into classes labeled “A,” “B,” “C,” or “D” based mostly on both income or AUM. Whereas this quantitative strategy helps to determine your most worthwhile purchasers, chances are high you already know these purchasers properly. So, what about the remainder of your e-book?

Commonwealth’s Enterprise Consulting crew typically recommends our advisors use a extra holistic segmentation technique known as the “ABSLN” technique.


With the ABSLN segmentation technique, you continue to determine your prime purchasers as “A+,” “A,” or “B” based mostly on the income they generate in your agency. For the underside tiers, although, you will use qualitative standards to put purchasers into segments labeled “S,” “L,” or “N.”

  • S/Strategic: People on this tier have the potential to grow to be ideally suited purchasers. Contemplate younger, excessive earners with sturdy financial savings, enterprise homeowners with illiquid wealth, or HENRYs (excessive earners, not wealthy but).

  • L/Legacy: These purchasers could have a legacy relationship that justifies offering continued service—for instance, “A” purchasers’ kids, widows, or private associates.

  • N/Non-ideal: These purchasers don’t match into every other segments. For them, you possibly can proceed providing service, switch them to a junior advisor, or discontinue your relationship.

This strategy presents deeper perception into the sorts of purchasers presently in your e-book, which you’ll then use to determine the sorts of providers you will ship to them.

From technique to motion. Not too long ago, I labored with a Commonwealth-affiliated advisor on some capability points. They had been questioning whether or not to rent a service advisor to handle the underside half of their e-book. Collectively, we used the ABSLN technique to phase their purchasers and analyze how a lot income every tier introduced it. It rapidly grew to become clear that hiring a brand new advisor would value them way over the property being managed. So, the advisor determined it would not make monetary sense to rent assist in that space.

Through the use of this evaluation, although, the advisor realized that a lot of their present purchasers fell into the “non-ideal” class. They determined to cut back the providers they supplied to that group and had been capable of liberate a while, which was their authentic objective.

Pairing Segmentation with Providers

As soon as you’ve got completed the shopper segmentation train, you may transfer on to constructing your shopper service mannequin, the place you will determine which providers you will ship to every phase—and the way typically.

If you happen to’re like many advisors I work with, you might have your providers mapped out in your head. However belief me, it is price documenting them. Like with different processes, clear documentation will assist be certain that you persistently supply high-quality service.

To assist with choices about service choices, mirror on these questions:

Your objective is to create a persistently excellent expertise for the purchasers in every phase and to attenuate any exceptions.

The typical Commonwealth advisor generates solely 9 % of their whole income from the underside 50 % of their shopper base. So, though it might sound apparent, strive spending most of your time on segments that generate vital income and fewer time on people who don’t.

Take into consideration what number of hours you will have to decide to delivering varied providers, and make sure to think about time for enterprise improvement and follow administration actions.

The appropriate agency associate can recommend choices for delegating sure duties. At Commonwealth, we’ve helped advisors optimize effectivity by a spread of outsourced enterprise options. For instance, some advisors outsource a single tier’s funding administration actions whereas persevering with to handle portfolios for different segments.

If it is advisable liberate capability, determine non-ideal purchasers and, if potential, refer them to a unique advisor to melt their transition.

Your outcomes may begin trying one thing just like the under grids, with all providers—together with funding administration, monetary planning, advertising initiatives, and shopper occasions—on the left and the tiers that could be eligible for every service on the proper.

If the entire variety of hours you will spend to ship service throughout every shopper class would not align with the typical income earned from that class, chances are you’ll want to regulate.

  Consumer Tier
A+ A B S L N
Evaluate Conferences            
Proactive Outreach            
Funding Administration            
Monetary Planning            
Particular Experiences 
(e.g., shopper occasions, milestone recognition)
(e.g., 401(ok) overview,
CPA and lawyer collaboration)
  Consumer Tier
Evaluate Conferences 1 in-person assembly per 12 months (deal with subjects related to youthful purchasers: wealth accumulation, paying off scholar loans, shopping for a home, planning for household wants)
Proactive Outreach 3 further textual content messages and/or Zoom conferences (vs. cellphone/electronic mail)
Funding Administration Outsource to agency associate’s managed account answer
Monetary Planning Use extra turnkey monetary planning software program, reserving extra customizable choices for “A+,” “A,” or “B” purchasers
Particular Experiences 
(e.g., shopper occasions, milestone recognition)
Items for all times occasions (e.g., new dwelling, trip, new baby)
(e.g., 401(ok) overview,
CPA and lawyer collaboration)

401(ok) overview

Actively seek advice from CPAs/attorneys prepared to have interaction with youthful purchasers

Assign new HENRY purchasers to agency’s next-gen advisors


Cost commonplace funding administration charges according to “A+,” “A,” or “B” purchasers

Cost annual consulting payment to bolster the worth of proactive monetary planning

In fact, there’s no magic quantity for what number of shopper conferences to carry annually, and the variety of choices will fluctuate by advisor. Determine what you may present your purchasers whereas additionally being conscious of your capability.

Now What? From Technique to Motion

You have segmented your purchasers and created a service mannequin. Now, it is time to implement your technique in your follow. This implies systematically evaluating each side of your corporation to determine the place to make changes.

Listed here are some questions to contemplate:

Instance: If you happen to meet with “B” purchasers much less typically than earlier than, it’s best to modify your scheduling course of.

Instance: Ensure everybody understands the best way to onboard purchasers at completely different tiers.

Instance: If you happen to’ll be outsourcing funding administration in your “strategic” purchasers, be able to share why you’re feeling that is the fitting transfer for them.

Instance: Maybe you share the title of one other advisor who is perhaps a greater match for them.

Instance: Relying in your CRM system, you might be able to arrange workflows and add different key standards in every shopper’s file.

By aligning every space of the enterprise together with your new service mannequin, you will be higher positioned to draw extra ideally suited purchasers and scale your corporation.

Prepared for a Change?

When you do not have a deliberate shopper segmentation and repair mannequin, your purchasers can find yourself dictating how your corporation runs. Why not strive a unique strategy? In any case, providing your purchasers a fantastic service expertise should not come on the expense of your personal enterprise’s development.

Taking time to finish these workouts permits you to focus your vitality the place you want it most. The profit is extra time to handle extra relationships—primarily with ideally suited purchasers. Plus, you’ll be capable to help elevated income with fewer assets, which implies extra earnings heading on to your agency’s backside line. And that is a win-win.


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