Doctors' appointments usually follow a predictable script: you reveal what ails you and the doctor prescribes a treatment. Much to the frustration of many patients, such a prescriptive approach reduces the relationship to a mere transaction.
Financial advisors are also at risk of neglecting the "real relationship management" side of the business, says Elizabeth Hoyle, chief marketing officer with Bridgehouse Asset Managers in Toronto. That presents a key problem at a time when the second phase of the client relationship model (CRM2) is likely to prompt clients to question the value of their relationship with their advisor.
As you kick off 2017 in this landscape, it's a good time to evaluate your communication strategy to ensure it's meeting the expectations of your clients.
Specifically, if you hope to retain and attract more clients, you need to communicate with clients regularly beyond form letters and once-a-year meetings. There has to be a "two-way" exchange of giving clients critical information and getting their feedback on it, Hoyle says.
Advisors also have to account for clients' preferences and deliver information with substance, she says. That means moderating the frequency of your communications efforts based on individual preferences and sending articles on a range of topics, such as lifestyle, finances and regulations.
Communication shouldn't be limited to a formal, annual "checkup," in which you meet to conduct a performance review. Many clients appreciate some form of communication once a week, or at least once a month, says Neil St. Clair, chief growth officer with Vestorly Inc., a data-driven content platform for financial services, in New York.
In fact, many clients want to receive information beyond the scope of need-to-know briefings on policy changes and market movements.
"It's not so much that they want to hear about the markets," says St. Clair. So, rather than fixating on market swings, he says, many clients would prefer to receive material that relates to practical advice on how they can manage their finances. "That's what they're paying you to do — to take away the day-to-day worries."
There's also value in trying to engage with clients on a more personal level through your communication efforts.
"Advisors [can] set themselves up as a counsellor to all things life," St. Clair says, noting that many establish their businesses with the hope of nurturing relationships that span generations and cross over into clients' different life stages.
To be the type of advisor whom clients can lean on throughout their lifetimes, you should take time to curate, or share selectively, relevant pieces that speak to these clients' specific circumstances, says Victor Gaxiola, customer advocacy manager with Hearsay Systems in San Francisco.
Such efforts will open doors for deeper relationships and a more informed dialogue, which enhances your ability to identify cross-selling opportunities.
If it seems pointless to try to compete for clients' engagement online in this attention economy, think again. That's because as easy as it is to fetch content on any given subject, there's still an information barrier that clients have to overcome.
The advisor's role has evolved steadily not only to include filling gaps in clients' knowledge, but also making judgment calls about what clients need to be educated on.
"If I do a Google search, I'm likely to get three or four opinions," Gaxiola says. "But the opinion that really matters is from my advisor because [he or she] would have done the due diligence to understand the goals, as well as the specific tolerance for risk."
This is the first article in a three-part series on refining your communication strategy in 2017.
Up next: Enhancing your digital communication.