The key to successful client segmentation is to factor in both quantitative and qualitative elements, which exist in every business relationship. Though revenue will always be a critical component in determining the value of a client, we should not overlook the qualitative impact of factors such as referrals, attitude and growth potential.
The majority of advisors segment their books quantitatively, by assets and/or production levels. This gives only a partial answer to the quality and impact of any given relationship in your practice.
Thus, segment your book both quantitatively and qualitatively, using five variables (on a scale of 1 to 3):
- Current revenue
- Potential revenue
- Center of influence
- Relationship quality
- Time consumption
Please review the The Client Service Toolkit, and explore the additional content and resources in this series.