Five practical principles for financial advisors to win business
The good news is that financial advisors who focus on building supportive relationships with prospective clients will be able to prosper, now and in the future. Investors will choose to work with advisors they trust, regardless of market conditions.
The five principles I present below are based on my firm’s experiences helping some of the most successful financial institutions and financial advisors accelerate profitable growth by building trust. If you follow them, you and your firm will dramatically increase your success.
# 1: Listen more; talk less.
Before you begin pitching your firm and its services, encourage prospective clients to tell you about their needs, concerns, and goals. Seek to understand before you seek to persuade. This will help you better serve them and establish a level of trust that will inspire them to do business with you.
At the start of your first face-to-face meeting, ask some of these probing questions:
- What are the top three areas of importance to you in an advisory relationship?
- Why are you asking for help now?
- What worked with your past situation? What didn’t work?
- What are your concerns about starting a relationship with someone new?
- What are your biggest short-term and long-term fears about your money?
- How have these fears changed in the past year or so?
Paying close attention to your prospects’ responses demonstrates from the beginning that you’re focused on their needs, not yours. It earns you the privilege to offer them solutions.
# 2: Clearly communicate your investment approach.
Transparency builds trust. While there’s a limit to the amount of detail a prospect can absorb, you need to communicate at least the following:
- Your overall investment philosophy
- Your process for determining asset allocation
- Your process for evaluating, selecting, and monitoring outside managers
- Your utilization of and views on a range of investment solutions, including actively managed funds, indexed solutions, ETFs, and alternative investments
- Your approach to international investing
- Your approach to managing fixed income
Information promotes understanding, which in turn promotes trust. Prospects who understand and feel comfortable with your investment approach will be more inclined to work with you.
# 3: Explain the most important elements of your service model.
Many advisors fail to adequately describe one of the most important elements of their service model: communication. Take the time to explain how your firm communicates with clients, so your prospects will know what to expect.
Tell prospects about the important aspects of your communications:
- Frequency and purpose of face-to-face meetings and phone calls
- How your firm stays on top of client needs and concerns
- How you provide timely reports and analyses of performance
- How you provide market-outlook and thought-leadership information through white papers, newsletters, and other means
Service is more broadly defined today than in the past. It’s all about communication, which has a tremendous impact on cultivating trust.
# 4: Explain your fiduciary responsibilities and policies.
Tell prospects up front how you protect their confidentiality, resolve conflicts, get paid, and handle other important matters, including how you custody client assets. Including these topics in your pitch book, in addition to discussing them, sends a powerful message that you have clients’ best interests at heart. To further distinguish yourself from the pack, consider giving prospects a separate handout containing frequently asked questions about your code of ethics and fiduciary policies.
Communicating openly and clearly about fiduciary topics during the sales process demonstrates your integrity and enhances your credibility.
# 5: Use a multiple-step proposal-review process to close the deal.
To ensure that your sales process builds momentum and concludes positively, try this approach:
- Prior to sending the formal proposal, call to tell your prospect that the proposal is on its way. Briefly explain its key elements so the prospect will know how to review it intelligently. Schedule an initial review meeting to discuss the proposal in detail, and encourage the prospect to develop a set of questions for that scheduled call or meeting.
- During the initial proposal-review call or meeting, encourage the prospect to ask all questions and offer all comments that come to mind. This information will allow you to tailor your plan to fit the prospect’s needs. Schedule a follow-up call or meeting with ample time to review your modified proposal in detail.
- During the follow-up conversation, present a modified plan that demonstrates that you have listened and responded to your prospect’s needs. Address all questions and concerns and close the sale.
Recognize that process is important from the opening act all the way through to the final standing ovation. Use a multiple-step review process to build sales momentum and gather the information you need to deliver a custom solution that will convince the prospect to do business with you.
Invest the time to succeed.
If you’re accustomed to sprinting through the sales process, these five principles may seem more like a marathon. To implement them effectively, you will need to slow down and concentrate more on serving than selling.
I suggest that you and your key team members start by examining your current sales process. How does your approach align with your core values and the principles contained in this article? Review your past practices, taking into account your successes and failures, and agree on what you think will work best for you in the future.
Just as successful long-distance runners must constantly train to win races, successful financial advisors must constantly build trust to win business. The above principles are one proven way to do that.
© 2018 Excella, Inc. This content cannot be reproduced without the express written consent of Excella, Inc. and Ani Yessaillian.