Applied Intelligence: Best Practices in UHNW Prospecting
Business development can be daunting in any organisation – sales targets are often high-profile and ambitious, and success or otherwise is binary. There are theoretically plenty of prospective clients but, for most organisations, there is a competitive landscape to consider – and finite time and resources – so where to start? How to engage? And what is the ideal message?
For mass-market firms, it’s easier to rely on the “numbers game”: hire enough people to make enough phone calls, with the right message, and a certain percentage will come good. Even here, good hiring, strong team motivation and high-quality engagement is not simple.
But for prestige organisations, which are typically seeking out much smaller numbers of much higher-spending customers, the challenge is far greater. Just a handful of additional new clients can make the difference between meeting and exceeding targets or missing them. Conversely, mass or generic marketing approaches will always be viewed as such, and result in zero return.
At Wealth-X, we promote a number of golden rules and best practices for organisations that are seeking to grow their client base within the ultra-high net worth sector. These individuals may choose to spend US$1 million or more with a luxury brand in a single purchase or make a donation on this level with a non-profit. Or they may give a wealth manager US$10 million or more to look after. Such new clients are therefore highly valuable, if not transformative, for many organisations if they are successfully prospected.
TREAT EVERY UHNW INDIVIDUAL AS A SEGMENT OF ONE
Each has their own needs, preferences, passions and idiosyncrasies – and the funds to indulge them. They expect highly personalised engagement from all organisations they deal with and fully customised products and services.
DO YOUR HOMEWORK
There are only 212,000 UHNW individuals in the world so it is vital that the right people are approached, at the right time, and with the perfect pitch tailored to them. UHNW individuals will quickly dismiss generic approaches, lack of preparation or poor understanding of them and their needs.
Cultivating UHNW relationships cannot happen overnight; they need to be carefully nurtured over time, and most successful business development professionals cannot target more than 50 to 75 individuals in any one year. Keep up to date with these prospects’ news, and professional and personal events, over time and use these as potential triggers to gently nudge the relationship forward, noting that it typically takes 12-18 months to successfully cultivate a new UHNW relationship.
HARNESS THE POWER OF REFERRALS AND PASSIONS
There are only two methods proven to successfully engage an UHNW individual – an introduction via a trusted acquaintance and/or pin-point targeting of their unique interests, passions and hobbies. Both will motivate and engage; cold or untailored approaches rarely, if ever, will.
DO NOT WASTE MONEY OR TIME ON ‘HOPE MARKETING’
Direct marketing, typified by sending out emails, brochures or glossy books is, at best, very expensive given the high production values and quality required for any credible prestige brand communication, and the high volumes of outbound mailing required to generate some form of return. At worst, it is entirely a waste of money, which provides no financial ROI and no learnings or feedback for future improvement.
With these guiding principles in mind throughout, we recommend that organisations follow a clear sequence of prospecting activities and best-practice approaches. These three phases are as follows:
START BY UNCOVERING THE UHNW INDIVIDUALS YOU ACTUALLY ALREADY KNOW, BUT DIDN’T REALISE WERE ULTRA-WEALTHY
Luxury brands, financial firms and non-profit organisations all have customers and prospects on their databases that they did not realise were ultrawealthy. These individuals may have only spent or given a small amount so far but have the capacity to spend or give very significantly.
By screening our clients’ databases against our dataset of known UHNW individuals, we can uncover these people. The great news is that they’re already engaged with your organisation. But now they have been identified as having a high capacity to spend or to give, they can be marketed to and communicated with in a very different way.
In most cases, our clients know less than half the UHNW individuals we identify as ultra-wealthy, unlocking tremendous immediate potential for increased sales or donations. Typically, we find five UHNW individuals in every 1000 records in our clients’ data, rising to 50 per 1000 in certain sectors. These customers are almost always the lowest cost to acquire and the fastest to win.
IDENTIFY AND APPROACH THE UHNW INDIVIDUALS THAT YOUR EXISTING ULTRA-WEALTHY CLIENTS ARE CONNECTED TO
With referrals being such a significant influencer for UHNW individuals, the next step should always be to understand the relationship networks of the ultra-wealthy customers and clients that you already have today. Assuming your current ultra-wealthy customers are positive about your organisation (which they almost always will be, because they wouldn’t be your customers if you weren’t providing exemplary service!) these brand ambassadors will be connected to other ultra-wealthy and able to make a referral or positive introduction to them.
We tend to find most UHNW individuals are connected by first degree to between six and 10 other UHNW individuals.
CONDUCT HIGHLY TARGETED GREENFIELD PROSPECTING
Of course, there is also a wider world of UHNW individuals beyond the above, though it will never make sense from a time and money perspective to attempt to target all of them.
The first step is to identify and prioritise those with a known passion for, or interest in, your sector or cause. Or a known passion for, or interest in something that you plan to use as your theme or “hook” for an event or other kind of engagement. Detailed and methodical research is required here to ensure every communication is perfectly targeted and – given the cost of high-quality communications and engagement – there is minimal wastage.
More than this, timing is critical, so understand recent important events in your prospects’ lives – keeping updated about them is essential to ensure optimal timing.