The asset management sales funnel is an hourglass

In brief

The asset management sales funnel is an hourglass that comprises buying, staying, and buying more. This is important because a traditional sales funnel that only includes ‘buying’ would expose an asset manager to the risk of lower growth. The Client Behavior Benchmark is now helping firms see where on this end-to-end sales funnel they out- and under-perform their peers.

The asset management sales funnel is an hourglass

For over 100 years, firms have tracked the behavior of prospects as they move through various steps in the sales funnel.

Traditionally, the sales funnel is an inverted triangle made up of the most important activities that indicate a prospect’s progress towards purchasing. With buying as its sole objective, the concept is particularly well-suited to a transactional business that involves limited post-sale support.

Is that asset management? No. Managing investments is a relational business where ‘buying’ constitutes the end of one stage in a broader client journey and the start of up to two more stages: ‘staying’, and ‘buying more’. ‘Staying’ extends the sales funnel beyond the end of the traditional model, and ‘buying more’ widens it again. As a result, we believe the asset management sales funnel is an hourglass.

For asset managers, a traditional sales funnel risks lower growth

An investment firm that uses a traditional sales funnel is likely to create problems for itself. The central point is that, in a relational business, a sales funnel that includes only the first stage of a relationship, would risk de-emphasizing the second and third stages.

In relative terms, you could end up over-emphasizing costly new sales (‘buying’) at the expense of client retention (‘staying’) and relationship depth (‘buying more’). For example, if you lost clients at a greater rate than your peers because you lacked a client retention strategy, your dependency on new sales would risk lower growth because you would need to replace an unnecessarily high level of lost revenue. To use the old analogy, you would have to pedal faster just to maintain your previous speed.

Of course, heads of distribution care deeply about client retention and cross-selling, but we all know Peter Drucker’s famous truism that “what gets measured gets managed”. So, if relationship managers do not receive targets for client retention and relationship depth that are then tracked and benchmarked, the distribution function could unwittingly expose its firm to this risk by under-emphasizing these two stages of the firm’s actual sales funnel.

Introducing the Hourglass

The Client Behavior Benchmark lets asset managers measure, compare, and predict the behavior of prospects and clients across the end-to-end client journey.

Because of this, it is perfectly positioned to help firms focus their efforts and attention on just the metrics that reside on the asset management sales funnel. To make this happen, Accomplish has introduced a new feature into the benchmark: the Hourglass.

The Hourglass is a subset of the client journey that creates a coherent, holistic, and high-ROI set of metrics that are vital for business management and target setting.

The measures we have elevated to the Hourglass include strategic and dollarizable behaviors like sales conversion, client tenure, and product-per-client ratios, as well as tactical behavioral indicators like time spent on thought leadership, event attendance, and client meeting volumes. We have started the roll-out in the institutional benchmark, where this amounts to 20 metrics.

Furthermore, monitoring your sales funnel in the context of a benchmark will highlight the stages where you out- and under-perform your peers. This will help you evaluate different strategies for moving prospects and clients through your sales funnel and keeping it as wide as possible. And, as well as balancing your efforts and attention on the key client behaviors, the Hourglass’ structure will enable you to recognize a prospect’s location in the funnel so the right person can take the right action to move them forward.

The Hourglass comes ‘as standard’ with the benchmark

To help firms exploit the asset management sales funnel fully, we have embedded the Hourglass into Accomplish’s Behavioral Analytics Platform so you can filter and sort your data at the click of a button.

Our benchmarking reports contain independent insights, hypotheses,  and recommendations that focus purely on the Hourglass. You will also receive a summary Hourglass report designed to be an input for a Quarterly Business Review.

And, to confirm, the Hourglass is purely additive. We know that non-Hourglass metrics (for example RFP, reporting, and query completion times) will never stop being important for you, so the Client Behavior Benchmark will continue to monitor these and give you early warning of any issues.

A self-governing user group

We hope you like the Hourglass, and we look forward to evaluating it with you at the next User Group meeting. We will then roll it out to the intermediary benchmark that we are designing to suit this new feature.

Picture of Adam Grainger

Adam Grainger

Behavioral analytics | Business intelligence | Asset management

Find out

Please fill in this form and we’ll redirect you to the download for our brochure right away.