Today, we have to make every dollar we spend on our business count.
In light of that, here are three traps that can sabotage your return on client entertainment and recognition and appreciation activity – and three ways to ensure you’re getting fully value for every dollar you invest.

Trap one: Confusing recognition activity with sales and education initiatives
I recently talked to a Toronto advisor who hosted a “client appreciation” dinner featuring a talk by a wholesaler from a fund company that he supported. (This was motivated in part by the fact that this fund company contributed toward the dinner’s cost.)
He was disappointed by the response from clients and surprised by how hard it was to get clients to come out – especially the key clients that made up the bulk of his book.
It’s hard to say exactly why he didn’t get a better reaction – but in my conversations with investors, part of the reason may have been that at least some clients feared that this might be a sales pitch in disguise for some new fund or investment solution.
Whenever you invite clients to hear a speaker, even if you call it appreciation, recognition or a thank you, there’s a risk that they might see it as something else.
If it looks like it might lead directly to revenue for you, some might see it as a sales initiative on your part.
Even if the topic isn’t investment related – let’s say it’s a lawyer on estate planning issues and insurance strategies – some clients may see this as education rather than pure appreciation. There’s nothing at all wrong with education – just don’t mistake it for appreciation.
If you want clients to see an event as driven by your desire to thank or recognize them, you need to step back and ensure that they see this as disconnected  from your self interest and something that will pay off with increased revenue.
That doesn’t mean that you can’t invite clients to educational sessions on topics such as alternative investments , investment opportunities in emerging markets or insurance strategies for business owners – just understand that these are unlikely to be seen as thank yous for the opportunity to work together.

Key message: If you want clients to feel thanked, ensure they don’t see this as leading to potential revenue for you.

 Trap two: Forgetting that “Less is More”
A second trap relates to the size of events.
Some advisors run large scale events, inviting a large number or sometimes all clients.
The logistics of organizing one large event is generally easier than organizing a series of smaller initiatives.
And sometimes the nature of an event lends itself to larger numbers – if you have a high profile speaker at an evening event for example, chances are you want to spread his or her cost across as many clients as possible.
The difficulty lies in the fact that many clients – and particularly top clients – don’t want to feel one of a large group of clients. Fairly or not, they want to feel that they’re getting special treatment and aren’t just a number in a crowd.
In talking to advisors who regularly invite clients to events, the best response tends to come from small to mid sized activities – anywhere from 6 to 12 seems to be the ideal number.
Sometimes that’s hard to do – especially if you have a high profile speaker out, for example. In a case like that, consider negotiating with the speaker to participate in a  dinner or a private reception with a small group of your very best clients before the event.

Key message: When inviting top clients to an event, try to make it small and intimate in size

Trap three: Running unexceptional events
 Advisors often talk about how hard it is to get clients to come out to a lunch or dinner – especially top clients and especially in large cities, where traffic and parking are problems.
We have to remember that most clients are busy – to get many clients to come out, there has to be a compelling reason to do so.
And even if you do take clients out to lunch or dinner, while they’ll thank you at the time, if it’s just another lunch or dinner it typically won’t have a lasting impact.
For client entertainment to really pay off, it has to be unique and different.

Some examples of successful client entertainment I’ve heard advisors talk about:

• Inviting a small group of clients to dinner in a private room at a restaurant and arranging for the owner to host a wine tasting or the chef to stop in to discuss the dinner
• Hosting 12 to 15 clients at a spring golf tune up at a local club, getting the pro to offer tips and having the sales rep from one of the golf club makers showcase new equipment
• Arranging a private tour of an exhibition at a local museum or art gallery
• Inviting car buffs to a reception at a local dealership for a high end car maker, with the dealer talking about what’s new in cars and offering test drives
• Inviting a top client to lunch to celebrate their fifth or tenth anniversary working with you – and surprising them by inviting three or four of their best friends to join you

The thing that all of these successful events have in common is that they’re unique and different. They may cost a bit more money (although often the cost is less in money than in time and thought) but they will be remembered long after a run of the mill lunch or dinner is forgotten.

Key message: Look for ways to make everything you do unique, compelling and memorable