As registered investment advisor (RIA) firms evolve, balancing high-touch service with scalable business operations becomes a key challenge. The ability to deliver a distinct client experience while establishing economic viability requires a structured approach to service delivery. A well-designed segmented service model ensures that clients receive the right level of service based on their needs, financial complexity, and revenue contribution—without overextending advisor capacity.

By aligning service models with client segments, RIAs can standardize processes, set clear expectations, and optimize time allocation, all while enhancing client satisfaction and firm profitability. Through outsourcing non-client facing functions (such as portfolio design, trading, billing, research, etc.), advisors can also free up time to focus on high-impact client activities.

Moving Beyond One-Size-Fits-All Service

Many firms start with a single, broad service model that attempts to accommodate all clients equally. Over time, as the client base diversifies, this approach often leads to inefficiencies—advisors spending disproportionate time on lower-revenue clients at the expense of high-value clients (who often require deeper, more personalized planning).

Segmented service models solve this by defining structured service tiers that calibrate client engagement levels, planning depth, and advisor involvement based on economic contribution and complexity.

Key Benefits of Implementing a Segmented Service Model

1. Establishing clear client expectations: Setting well-defined service expectations establishes that clients understand the level of engagement, frequency of meetings, and planning depth they will receive. This reduces confusion, prevents over-servicing lower-revenue clients, and enhances trust in the advisor-client relationship.

2. Standardizing service delivery for consistency: A structured model ensures that every client receives the right level of service at the right time. By defining meeting schedules, agenda topics, and service levels, advisors can create a repeatable, high-impact experience that improves client retention and strengthens relationships.

3. Optimizing advisor time and capacity: Advisors have a limited number of hours available each year to serve clients. Advisory team time is truly the core currency in a wealth management business. A segmented model assures that time is distributed effectively across different client tiers, allowing advisors to focus on high-value clients while ensuring lower-revenue clients still receive adequate support through streamlined processes.

4. 4. Enhancing client satisfaction and advocacy: Clients receiving proactive, customized service are more likely to be satisfied with their advisor relationship, leading to higher Net Promoter Scores^{® (NPS®)}and an increased likelihood of referrals. By prioritizing engagement where it has the most impact, firms can cultivate stronger advocacy within their client base.

Structuring a Segmented Service Model

A well-designed segmented service model should consider key categories that define the client experience and the level of advisor engagement. Focus Partners has identified six essential categories that inform service model design:

1. Team: Defines the primary relationship manager and support roles involved in providing wealth management advice—from financial planning to investment strategies.
2. Service: Specifies service levels, turnaround times, and the depth of advisor interactions—in particular the amount of time each team can spend with any given household.
3. Annual wealth planning: Establishes the scope and frequency of financial and investment planning provided annually.
4. Implementation: Determines access to more advanced investment strategies and financial solutions.
5. Relationship management: Outlines educational resources, appreciation efforts, and collaboration with centers of influence (COIs).
6. Proactiveness: Dictates the frequency and depth of advisor-initiated engagement, ensuring high-value clients receive proactive strategy discussions.

 

By structuring service delivery within these categories, firms can align their resources with client needs while maintaining efficiency and profitability.

Deploying Service Models Across Client Segments

Rather than applying a single framework to all clients, RIAs can implement any number of default segmented service models. Focus Partners has identified these five models based on revenue tiers (lowest revenue to highest):

1. Legacy model: Designed for clients paying below a firm’s minimum fee. These clients should be candidates for repricing into the firm’s standard fee structure.
2. Foundational model: Serves clients at the minimum fee level who require streamlined financial planning and investment services.
3. Core model: The primary service tier for ideal clients of most RIAs (e.g., $1 million -$5 million in AUM), integrating comprehensive financial planning, tax mitigation strategies, and systematic investment management.
4. Enhanced model: Tailored for high-net-worth clients requiring advanced estate planning, tax mitigation, and bespoke investment strategies.
5. Extended model: Reserved for ultra-high-net-worth clients with intergenerational wealth planning, family office coordination, and complex financial structures.

 

Each service model is calibrated to the complexity of client needs, ensuring that high-value clients receive a more robust advisory experience while foundational clients still benefit from a structured, scalable service framework.

Deployment Considerations: Where to Start

Firms looking to implement segmented service models should prioritize rollout based on their own unique situation:

• Business growth priorities: If a firm has a high number of legacy or foundational clients, formalizing service models for these tiers can free up advisor capacity. Alternatively, if growth is concentrated in higher-value clients, structuring enhanced service models may be the first step.
• Team structure and capacity: Firms with experienced associate advisors can transition lower-revenue clients to junior team members, allowing lead advisors to focus on more complex relationships.
• Client transitions and generational wealth planning: Advisors with aging client bases should consider formalizing service models for heirs and beneficiaries to maintain multi-generational relationships.
• Optimizing engagement for clients in drawdown: Many firms have a significant portion of their client base in retirement or wealth drawdown. Service models can help balance the increased service needs of these clients while prioritizing firm growth through higher-revenue segments in younger demographic populations.

Service Models as a Growth Lever

A well-defined segmented service model provides the structure necessary to deliver scalable, high-touch client service without overextending firm capacity. By categorizing clients based on needs and engagement levels, RIAs can better manage service expectations while optimizing profitability.

For firms looking to refine their client experience, now is the time to assess service models and ensure they align with both segmentation analysis findings and business objectives. Implementing a structured approach can not only enhance client relationships but also position the firm for long-term success.

Are you ready to evaluate your service model to discover whether you’re optimizing your advisors’ time and delivering the best service possible? Reach out to Focus Partners Advisor Solutions for more insights.

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