3 Ways Advisors Can Maximize Client Relationships

By Brian Neil
Practice Management Consultant – Hilltop Securities Inc.

As financial advisors, we’re tied to the same social norms as anybody else. This is an important thing to remember when it comes to your relationships with your clients. So much so, we stand to learn a lot from general interest guides on interpersonal communication.

One such guide is How to Talk So Kids Will Listen & Listen So Kids Will Talk by Adele Faber and Elaine Mazlish. Known as the “parenting bible,” the book sheds light on the communication between parents and children and offers methods for problem solving and relationship building. Many of the tips presented in this blog are based on concepts discussed in this book.

While the book is targeted toward parents, there is a lot of good advice advisors can use. The advisor-client relationship is based on trust. What better model to pull from than the parent-child relationship when it comes to building close, long-lasting relationships?

The following are three main areas you can concentrate on to improve your relationship with your clients.

  1. Advising Attentively. When clients share their frustrations with the market or any other aspect of their lives, it’s important to acknowledge their feelings. The way clients feel affects their behavior and, in turn, affects how they interact with you. If we deny a client’s feelings and brush them off as if they don’t matter, we only stand to make them feel worse and hurt our relationship with them.

    How can you avoid this with your clients? The next time a client expresses their feelings to you, try the following:

    • Listen quietly and attentively. Practicing active listening can go a long way with your clients. Also, if you think your client would be comfortable with it, take notes as the conversation flows. This type of listening shows you have a genuine interest in what they are saying, especially when you take the time to write down the important key takeaways so you can address them later, if necessary.

    • Acknowledge their feelings with a word or two. Another part of active listening is physically and verbally showing that you’re listening. You can accomplish this by nodding, smiling when appropriate, maintaining an open posture, and providing feedback. Sometimes clients already have a solution, they just want to make sure you’re in-tune with what they are trying to say. Often, paraphrasing what they’ve said or asking clarifying questions can help them think through their solutions or be more confident in them. By acknowledging your clients’ concerns, you’re also signaling that you’re invested in their overall wellbeing.

    • Empathize with your clients. For example, if the market is down and your client is genuinely concerned, say something like, “I wish I could make the market less volatile.” By doing so, clients will react to your willingness to empathize with them and won’t associate your capabilities with the problem at hand. Instead, they’ll see you as part of the solution.

  2. Encouraging Cooperation (AKA The Loyalty Ladder). Duncan MacPherson, CEO of Pareto Systems, speaks about the importance of encouraging cooperation with clients in his popular webinar series. We all have in our minds what the “ideal” client is: someone who takes your advice and is so happy with it that they provide you with referrals. However, getting them to this point takes a lot of work. Thankfully, a lot of that work consists of things you should be doing anyway.

    Pareto calls this “The Loyalty Ladder,” a process that converts prospects to customers, customers to clients, and clients to advocates. As advocates, your clients become such “raving fans” that they can’t stop talking about how great you are to their friends and family. So, how can we encourage cooperation and move our prospects and clients from one rung of the ladder to the next?

    • Provide objective information. When speaking to a client, what you say is as important as how you say it. For example, saying, “The risk profile selected is working great and your investment management is performing as expected” can reaffirm your client’s choices and your recommendations without explicitly stating them—since, as we all know, markets go up and down. This technique will shed you and your client’s decisions in a positive light and move them up another rung on the loyalty ladder

    • Be descriptive, not prescriptive. This helps communicate your feelings without making clients feel uncomfortable or pressured to take an action. Simply describe the issues at hand and help the client discover some possible solutions. Then, show your value and expertise by putting together a proposal that your client was an active participant in creating.

  3. Effective Praise. Telling a client “good job” or “great work” is too general to be effective praise. Instead, you should describe what you see and feel as well as sum up their good choices with positive words.

    One example of effective praise would be something like, “I see a committed couple with a well-thought-out financial plan that can withstand volatility. It is truly a pleasure working with you, Mr. and Mrs. Jones.” While this praise seems natural enough, it has everything it needs to be effective. Here’s how you can hit all the right points in your praise.

    • Make your praise specific. Go above and beyond to compliment a client’s ability to stay the course when things get tough or to cut costs and save more money—the more specific the better. This goes a long way when gaining trust, respect, and maximizing your relationship. It shows the client that you recognize their integrity and their ability to contribute to their own success. For example, if they hit a certain milestone in their life or financial plan/roadmap, be sure to recognize it. Doing so empowers them and inspires hope.

    • Make your praise public. Everybody likes being praised and acknowledged, so why not do both? If you’re on the phone with a CSA, say something like “My most dedicated clients just walked in.” Or, better yet, if you’re speaking with a couple, compliment one in front of the other. While it may seem hokey, it can go a long way in making your clients happy—and there’s no downside to that. Also, it’s good to act as a storehouse for your client’s special moments and keep tabs on their successes. Remembering them a year down the road will make a client feel valued by someone who truly listens. Finally, everyone likes to reminisce about the good times. Make sure you remind clients of how far they have come and focus their energy on positive outcomes.

Nurturing Lasting Relationships
Practicing active listening, encouraging cooperation, and using effective praise are all ways to help maximize relationships with your clients, as well as build new ones. As Duncan MacPherson says, the goal is to create client advocates. By continuing to perfect the way you communicate with clients, you’ll competitor-proof your business and build lifelong friendships.

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