Nothing is worse than spending time on a client that values your input, wants to discuss your research and attends your events, but doesn’t have the commissions to pay for it. As commission pools and client wallets continue to compress, it is more important than ever that you maximize the delivery of your available content and resources to the right clients and the right time.
I worked for many years at a small broker dealer, when they existed, that had a truly innovative and creative sales and research team. They understood that to maximize the value of their offering, they needed to service the right clients. We weren’t as big as the bulge bracket participants, but we knew we had a unique value proposition with deep industry expertise. We could have broadly offered our resources and services but instead we took the time to be much more tailored and aligned to the clients interest to ensure we maximized the ROI for what we had to offer.
Our strategy started with which clients paid the most commissions and have the biggest wallet share. We then identified what services and content they valued most. Was it our written research, one-on-one time in a discussion with our Analysts, corporate access meetings or data points from our proprietary risk arbitrage database? Furthermore we put in the time to better understand the sectors, companies, securities and products they invested in or used to express their investment.
When you put this profile of data and interests together at a client-by-client level it takes the guess work out who you should call and invite to which event or meeting. Presenting clients with the specific topics, events and meetings they care about in a timely manner will ultimately lead to increased market share.
At the time I was able to work alongside some very seasoned research salespeople. There was one such salesperson I recall that started his day at 5 am everyday and he would go through all of our newly published research, models and events and would craft very tailored emails to each of his portfolio managers. He would say, “When we spoke last week you asked me to keep you informed about any meaningful research we published on Apple. Our senior analyst upgraded the company and placed it into an overweight because they are about to announce a new product line of smart phones and we see this product adding 30% growth to EBITDA over the next 18 months which is a growth rate of 200%.”
He was able to do this type of tailored customized engagement because he was tracking all his client conversations and interests in a spreadsheet. He would put in a list of tickers aligned to the research and events published and it would filter the list of PMs that expressed interest in those names among a list of a 100’s of contacts he covered at 10 different buy side firms.
We had another junior salesperson on the desk that took that manual spreadsheet process and helped scale it across the client coverage for the entire New York sales team. He loaded in holdings data from Bloomberg, updated Indications of Interests from our clients, pulled in trading commissions by ticker and past meetings and events to a Microsoft Access database and would crunch all of the inputs everyday to align our available resources to the client that had interest.
This was at firm called Bear Stearns and his name was Ryan Mahoney. Ryan was a great person, smart and eager to learn and build his own career. He helped the more senior experienced sales team learn to use technology to help improve the efficiency in which they would spend their time with the right content and services and with those clients that also had the ability and wallet to pay top dollar for that service.
Ryan’s attempt to scale that manual spreadsheet is a perfect example of what Tier1 has since solved for in its foundational interest-based CRM. Tier1 empowers you with the tools to target clients based on their interest and ensures you are offering it to those clients that also have the willingness and ability to pay for your value-add content. Those data-driven decisions can help you make the most informed use of your time and drive increased market share and revenue for your business.
When you take your proprietary client data and layer in third party fund holdings data from our Prospector tool powered by Refinitiv, you can not only enrich the targeting and interest model of your current client data but also discover new clients you may not have known had an interest in something you were selling.
Ryan has since passed away and I think about him often as I’m sure many others do who knew him. He was remarkable.
My career has taken me from that small firm to one of the largest, and for the past several years to Tier1. It is our mission at Tier1 which reminds of this journey and of Ryan’s efforts so many years ago. We are committed to delivering tools that integrate compelling data and ultimately automate these powerful insights for actionable results. We didn’t get here without listening to our clients and understanding the specific workflows required for successful outcomes. We remain grounded in solving the challenges today’s firms continue to face – and delivering tools that help make your work more efficient and productive.
To learn more about Tier1’s client relationship management and workflow solutions for capital markets and investment banking, or to request a Tier1 demo, contact us.