I’ve spent years leading prospects to sound financial decisions. But the question that I’m asked most often is: Why do prospects choose me over other advisors?
I believe prospects consider several important characteristics when choosing an advisor, but the most influential characteristics are trust, likability and competence.
Obviously one of an advisor’s key characteristics — if not their most essential quality — is integrity. You must be someone prospects can trust with their most personal financial information, as well as with detailed family matters that impact their finances. Prospects must be able to trust your ability to keep their personal information confidential and not share it with other prospects or those outside your practice who might profit from the information.
More than half of Americans believe financial advisors put their company’s interests above the client’s interests, according to a 2015 survey by the Certified Financial Planner Board of Standards. That’s not surprising with the current state of affairs, including Sen. Elizabeth Warren’s investigation and the proposed Department of Labor (DOL) fiduciary rule. And with memories of extreme cases of fraud still lingering in people’s minds (Bernie Madoff, anyone?), it’s no wonder that a few bad apples have tarnished the reputation of the financial services industry. Although the government is trying to increase regulation to protect consumers from these types of charlatans, I also believe it’s up to us to instill trust in all our clients and prospects, and I believe we can do that.
We know trust in a relationship is something that is earned over time. Business is relational from top to bottom. Trust in a relationship is earned when people do what they say they will do, when they say they will do it. One of the keys to being a trustworthy advisor involves the method and amount of communication you have with your clients and prospects. How you communicate in a personal manner on an individual basis and what initiates that communication are incredibly important to building trust.
If trust is earned over time, how do you overcome the trust issue with new clients and prospects? I suggest you “borrow” some trust. One way for prospects to check on your credibility is to have them call a couple of your current clients and ask about their experience in working with you. What is your style of communication? How do your clients feel when you are leading them through investment options? Do you communicate regularly?
The answers to these questions will give prospects a feel for how much your current clients trust you.
What is the Internet saying about you? If you’re not doing it already, you should Google yourself on a regular basis. If prospects don’t know you, chances are they’re using the Internet to conduct some preliminary research on you.
What is your online presence telling prospects about you? Are there unfair reviews from past clients or other potentially embarrassing posts? In most cases, you can have these items removed. (Facebook and Google have procedures for removing inaccurate or inappropriate content on your own.)
You may not be able to remove all the reputation-damaging material you find about yourself online, but you can make things better by raising your online profile in a positive way so that anything bad is pushed further and further down in search results. You can do this with content on your own website or blog, or by contributing content to industry publications or websites as well as your local publications.
Most salespeople understand that being likable is important to their career. After all, most customers prefer to work with those salespeople they know, like and trust.
Being positive and enthusiastic will go a long way toward making you more likable. But there are other things you can do to boost how a customer sees you, such as having good manners and being authentic. Your customers probably already like you. But are you being as sincere and polite as you could be? Are you showing customers that you care by using good manners?
The most important question is: Are you the kind of person prospects would want to work with? You don’t want your clients or prospects to dread communicating with you. If prospects feel that calling you with a question is like setting up an appointment for a root canal, you have work to do.
How do your prospects determine what kind of person they would like to work with? First, you must know a little about your prospects. To this end, I think Tim Templeton’s description of four business temperaments in his book The Referral of a Lifetime might be helpful.
What type of business temperament do you think you have? You must determine what temperament type you are and work with prospects accordingly. Be aware that you typically will be a good fit with two out of the four temperament types, and probably can reach for a third.
Competence means having acquired enough experience and knowledge to do what your prospects need you to do. Hosting workshops and client events are ways of communicating your philosophy and financial planning techniques.
How do prospects determine an advisor’s competence? There are varying levels of financial planning in the industry. The Certified Financial Planners Board of Standards considers three types of financial planning. Each type requires different levels of information and training, yet all require advisors to be diligent in their
efforts and knowledgeable about the tasks.
The first type of financial planning is a single-issue plan. In other words, a prospect needs only one facet of their finances — such as life insurance or an annuity — dealt with. Prospects will find a planner with expertise in that area and use them for their planning needs.
Second, you have a multistrategy approach combining several types of assets in a financial plan. The plan may include life insurance, health insurance and an annuity.
Finally, prospects might need a comprehensive plan that involves everything they do financially. Life insurance, annuities, health insurance, property/casualty insurance, tax planning, mutual funds, stocks, bonds and even a revocable trust might be needed to realize their planning desires. For this, prospects need an advisor who would quarterback a team of professionals.
The CFP Board considers all of these valid types of financial plans. Obviously, these three types of planning require varying degrees of competence.
Although certifications don’t necessarily equate to competence, they are perceived positively by consumers. Certification matters to most people when it comes to working with a financial advisor,
according to a 2013 Financial Advisor Consumer Survey conducted by the CFP Board. More than eight in 10 respondents (84 percent) believe that certifications are important when choosing a financial advisor, and 87 percent reported that they would feel more confident working with an advisor who has a financial planning designation.
Whether you’re a new advisor building your client base or you have been in the business for decades, it never hurts to evaluate whether your clients and prospects are finding what they’re looking for. Are you being transparent with them? Are you providing a fair value for what you’re charging?
Financial advisors are some of the most trusted professionals, so make sure to give your clients what they need. After all, prospects are looking for someone who, like the famous football coach Vince Lombardi, is chasing perfection and catching a little excellence along the way.
Dave Vick is the executive vice president for Dressander|BHC, a billion-dollar financial marketing organization. Dave may be contacted at firstname.lastname@example.org.