Three Actions for Greater Client Appreciation

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Most clients do not understand what great work their advisor does for them, and this is a problem, but there are three steps you can take to counter this.

I have seen firsthand in my work with advisors and institutions for over 25 years, how the lack of plain straight communication can bury an advisor’s true value. In casual settings, I have made a hobby out of asking people to tell me about their financial advisor. Invariably, the investor cannot put together more than one or two coherent sentences. This applies to very wealthy people, and folks at the other end of the spectrum, whether their advisor is at a wirehouse, or a tiny RIA.

Most of the time there is no malice in the reply, just the usual, “He’s a great guy” or the “We’ve known her for YEARS and she’s just lovely.” I almost never get a reply that informs me about the great work the advisor does: the careful selection of an investment portfolio, the crafting of a complex financial plan, the hand-holding and cajoling that successfully dissuaded the client from investing in that idiotic new business venture from cousin Larry. From these experiences I have surmised two things: Communicating simply and effectively is the only way to get others to recruit prospects for you, and simple does not mean easy.

But the struggle is worth it. Once clients truly understand the great work you do, they will appreciate you more. There are several reasons why this is important.

First, when the market tanks, they need to not blame you. In 2007-2008 advisors that rarely lost clients got fired because of the market. If clients have a good appreciation of all you do, they are less likely to terminate when things get tough. Secondly, an educated client will give you more and better referrals, often without your asking. Lastly, and in my mind, most importantly, the new clients you land because of these better referrals will have their lives enhanced because of professional guidance.

Advisors perform a true service to society, and the more consumers use them the better off we all are over the course of the long haul. Fewer than 50% of Americans have a financial advisor, despite the location of FAs that cater to nearly every type of client in virtually every town. Too many consumers  blow themselves up financially, so clearly the percentage of advised Americans must increase.

So what should you do?

For starters, if you have an annual client review, work in advance to to re-frame what you do in plain English. And when you meet, pay attention. Watch for the physical cues in your clients’ eyes and in their postures that signal if they are starting to zone out. If that’s the signal, simplify (or dumb it down) even more. When appropriate, try humor. You might tell them it appears that “officially” they have no clue but don’t blame them. Restate your point in a different way.

Secondly, take a good hard look at your website, your newsletter, whatever you send to clients. Odds are it could use a good re-write that zeroes in on what you can do. Avoid platitudes like “We secure a family’s financial future.” Avoid jargon but be specific about you can offer. Describe your value but be aware that terms likeMonte-Carlo simulations, inverse ETFs, and Beta do not belong in marketing material.

Finally, make sure to write down and practice the elevator pitch you and your team will use. You want every person in your group to have a consistent, brief message for every client and prospect. Training your staff to be your emissaries are vital to freeing your time for other business necessities and for evening and weekend recreation. And your team’s pitches drive referrals as well.

To be fair to the challenges I am discussing, financial advice is an intangible that is often difficult to explain. Most people are simply not excited about investing, planning, insurance and the like. It’s up to you to stir their interest and to explain your value in plain English. The real reward comes when new clients who were harming their financial well-being see how your service has improved their lives.

Nicholas W. Stuller, a 25-year veteran of the financial services industry,was the founding CEO of Discovery and Meridian-IQ, the two largest advisor data companies. His book, THE TRUTH SHALL SET YOUR WALLET FREE-Secrets to Finding Everyone’s Perfect Financial Advisor, will be published in the fall of 2018 by Post Hill Press.

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