Pathways to Growth
Capital Group’s Advisor Benchmark Study
Research reveals three growth factors
In Capital Group's inaugural Pathways to Growth: 2021 Advisor Benchmark Study, we surveyed more than 1,500 advisors in search of answers to a crucial question: Why do some practices grow over 60% faster than others? Our research identified certain actions and behaviors that helped drive growth for all types of practices.
These higher-impact activities fall into the three categories below.
Enhance your practice with actionable ideas found in our Pathways to Growth article collections.
Successful practices make client acquisition a focus and have established procedures for marketing, acquisition and client onboarding.
An intentional approach
Clients are the lifeblood of every practice and key drivers of assets under management (AUM) and revenue growth. Our study showed that practices that made client acquisition a focus and utilized marketing-based strategies gained a greater-than-average share of new clients and achieved higher-than-average growth. Yet, the average practice relies on referrals for over 80% of its new clients and engages in limited marketing activity. And despite minimal acquisition-oriented marketing activity, respondents expected new clients to be a primary growth driver.
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Delivering products and services that support clients in reaching a range of life goals builds confidence, loyalty and deeper engagement.
More offerings delivered in a differentiated way
Certain products and services are “table stakes” offerings for all practices. But our study confirmed that practices offering a broader range of services tied to the long-term goals of clients and their families — from tax planning, to charitable giving, to serving multiple family generations — grew faster than those that did not. One key offering correlated to high-growth was retirement plans, as practices with significantly higher-than-average shares of their AUM in them grew faster.
Products and services offered directly through practice
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Building a business takes thinking like one, which means spending more time on the activities correlated to growth.
Spending time smartly
While it may come as no surprise that advisors are dedicating 80% of their time to client and investment management, our findings indicate that allocating more time to practice management leads to higher growth. Seeking areas of efficiency – through technology, model portfolios, processes, productivity tools and team building — and focusing on the highest-value activities leads to higher-growth practices.
Share of advisors who set defined and measurable goals in the following areas
Source for all chart data:Capital Group Advisor Benchmark Survey, July and August 2020
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Download our Pathways to Growth Advisor Benchmark Study for more insights, including:
- Client acquisition behaviors associated with high-growth practices.
- How high-growth practices differentiate their service offerings.
- Technologies and products high-growth practices use to build scale.
- Strategies for avoiding the mid-career slump.
- Five steps on your pathway to growth.
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