As investors get older and their decumulation continues to have more impact, firms will
have to be more reliant on their ability
to bring in new clients.
The 2018 RIA Benchmarking Study
from Charles Schwab examines how
the independent advisory industry
remains on a growth trajectory, and
how much new clients play a role in
The data from Schwab’s latest study
indicates assets under management
grew 16.2% in 2017 at the median versus
9.6% in 2016.
“Certainly the market played a role in
[the 2017 growth], but even when you
peel away the market performance and
net deposits by existing clients, you can
see the acquisition of new clients was
quite robust in 2017,” Jon Beatty, senior
vice president of sales and relationship management at Schwab Advisor
Services, explained. The study found
that adding new clients has an outsized
impact on AUM growth.
Asset growth from new clients is
more than twice that from existing clients for a majority of firms, according
to the study.
“The acquisition of new clients brings
in about twice the amount of assets that
are earned through the existing client
base,” Beatty told IA. “As you expect, as
the investors get older and decumulation continues to have more impact,
firms will be more reliant on their ability
to bring new clients in to retain growth
rates and retain assets under management. That is a critical business measurement to track and make sure you’re
understanding how you’re doing as a
According to Beatty, the firms that are
most successful in attracting new clients
are focusing their ability to appeal to
and meet the needs of their ideal clients.
The study finds that firms that document both an ideal client persona and
a client value proposition — of which
more than half of firms do so — win 26%
more new clients and 41% more new client assets than those that do not.
Beatty described the “ideal client
persona” as the idea of “creating a
focus within the firm on the particular
attributes of clients that you work the
“We’ve talked a lot in the industry
about services driving differentiation,
and you can see that trend contin-
ues. But the idea that there’s another
dimension of creating differentiation,
which is creating a curated experience
around a specific type of investor per-
sona,” he added.
Beatty said that he’s seen examples
of investor personas around types of
“For example, some firms specialize
in people who love to travel and create
a client experience both around invest-
ment management processes as well as
other services they might deliver to that
type of client,” he explained to IA.
Another example he’s seen is a firm
that likes to specialize in people who are
interested in wine.
“They can create investment outcomes around wine, they can create
community experiences around wine
experiences,” Beatty said.
Another example is family governance, according to Beatty.
The study found that a growing number of firms have added services that
address clients’ unique needs. Charitable
planning services were offered at 80% of
firms in 2017, up from 63% of firms in
2013. Family education services were
offered by 72% of firms in 2017, compared with 56% in 2013.
Several other services that became
more widely adopted in 2017 include: tax
planning (76%), lifestyle management
(33%), bank deposits (32%), life insurance products (31%) and annuities (31%).
The 2018 RIA Benchmarking Study,
which was fielded from January to
March 2018, contains self-reported data from 1,261 firms that custody their assets with Schwab Advisor
Services and represent slightly over $1
trillion in assets under management.
This self-reported information was
not independently verified, according
Participant firms represent various
sizes and business models. They are
categorized into 12 peer groups — seven
wealth manager groups and five money
manager groups — by AUM size.
Staff reporter Emily Zulz can be reached at
RIA LESSSONS & LEADERS
By Emily Zulz
Here’s the Key to Attracting New Clients
Schwab benchmarking study finds that firms use winning strategy to
attract 26% new clients than those who don’t