by Matthew Johnson, Managing Director at Marketplace Finance
As finance brokers battle to assist their clients in a COVID-19 world with rapidly changing credit conditions around us, it is crucial for brokers to find new ways of adding value to their client relationships to enhance their business prospects in these unprecedented times.
Here, I share my top three tips on how brokers can improve their relationships with clients and continue to add value to their services whilst staying relevant. With COVID-19 restrictions causing economic chaos and new borrowing likely to slow down to a crawl, along with existing regulatory changes coming in the roll-out of best interest duty, the time is ripe to implement changes to protect against the uncertainty. Lockdown may prove an opportune time to plan for the next stage in your business.
Adding value by providing a path forward
In times of upheaval and uncertainty, we all look for someone to provide us with a sense of calm confidence and path to move forward along. Whilst many brokers are experiencing a sudden shock to their own business, we have a privileged position to be able to help provide our clients with a clear plan for their finances and set minds at ease in a stressful situation. This is usually the case with clients but is amplified in times such as we live in now.
The first and most crucial piece of advice is to add value to your relationship with all clients. You can do this by thinking about the skills and knowledge that you have and how this could be used to offer your clients different products or services that would benefit them.
For example, what things are you passionate about that you could leverage to expand your business? If you are a broker with a keen sense of risk management, you could help clients with finding the more appropriate insurance policies.
Problem solving with clients is another essential way to add value. Your clients are typically in need of a funding solution, not for you to put up roadblocks. So, in researching solutions, be imaginative with the possibilities and explore all options and seek partnership where you lack the capability, rather than saying ‘sorry, can’t do’.
Connecting your clients with trusted professionals such as financial planners, accountants or lawyers can also help add value. Providing clients with all the information and services they need now can provide confidence and help you retain clients for future deals and cement your position as a trusted adviser.
Diversify revenue streams
It is also very important to diversify your current offering to protect your business. By providing different services and products you can create more income streams. Think here about your client requirements and offer more useful services to help retain clients who might otherwise go elsewhere.
Diversifying your business can help safeguard your income when there are external shocks to the business or regulation changes which will impact your market. With mortgage brokers facing tough economic conditions and continued growth in regulatory oversight with best interest duty regulation coming into place, the key is to act now to make your income streams more secure.
Another way of diversifying your business is by forming partnerships or collaborations with other service providers. Connecting with other experts such as buyers agents, valuers, solicitors or accountants can add real value to your clients’ businesses. Partnerships can build momentum and new leads for your own business, as well as the other business with whom you link up. Importantly, partnerships and collaborations can work well for any business, whether big or small, as they expand your reach to previously inaccessible audiences, allowing you to combine resources to help you more easily reach your business goals and open up revenue streams. According to one study by marketing firm Hinge, a third of high-growth firms rated partnership marketing as the most effective marketing technique of all out of 24 possible marketing techniques in the survey.
When looking for another business with which to partner, there are some important factors you should consider. It is crucial that your businesses can work together and produce complementary products and aren’t competitors. That’s why collaborations between residential and commercial mortgage brokers or accountants and financial planners can work so well - they are perfectly complimentary, yet are very different businesses. Partnerships can become an invaluable way for your business to expand and reach new audiences, without putting in all the effort yourself.
Finally, you must stay relevant to your clients by knowing what is happening in the lending market. Networking with other brokers and lender staff greatly assists keeping the finger on the pulse of the market. This is more important than ever now with so much change in lender risk settings. Aggregators can also assist brokers to stay at the forefront of product and industry trends along with regulatory changes. Aggregators often know what is happening behind the scenes, so it’s important to connect with them to better tap into that information.
Another effective way of staying ahead and staying relevant is by leveraging first class technology options across your business. Leading customer relationship management (CRM) systems allow brokers to manage customer information, engage with external clients and stakeholders and automate processes allowing brokers to focus on identifying leads, closing more deals and growing their business.
Your clients should be able to upload documents to the CRM and send and receive information, 24/7. A good CRM will allow you to respond quickly, store customer information and easily bring it up when needed. This can cement your relationship with your client by staying on top of their needs. It means your conversations are always personal, relevant, and up to date.
Remote working and video conferencing have also suddenly become critical capabilities for brokers. Thinking forward to a post-COVID 19 lockdown world, there will be wins to be had for brokers who can leverage these skills and technology solutions to be more flexible in the way they engage with their clients, partners and staff. We have all been forced to embrace these notions but continuing to leverage them in the future will help secure a successful and strong future for your business.