This is the 15th in a series of Tips, each featuring a ‘sneak peek’ at the bi-weekly strategies of content contained within our new Pareto Academy for Practice Management. The Pareto Academy is an on-going stream of webinar-delivered strategies that provides financial advisors and their team members with proven concepts that are easy to implement with predictable results. A one-year renewable membership enables you to implement strategies developed by the most respected authorities in the financial services sector.
Today’s Tip, touches on:
- An effective manner to communicate who is a good fit for you as a client
- Utilizing a fit approach that considers other factors beyond just assets
- How your response on ‘minimums’ impacts a prospective client’s initial impression
A question we are asked by many advisors early on in the coaching cycle is: “How do I tell prospective clients about what my ‘minimum’ is?
This may sound like a rather straightforward question that deserves a straightforward answer, and it is. So consider two distinctive ways of answering this, and the ramifications of each.
The way many advisors respond is:
“For me to work with a client, the minimum assets I require are $500,000 (or whatever the number is for you).” At this point, the advisor may then feel obligated to provide an explanation and they add something like; “or it simply is just not worth it to me.” Regardless of whether or not they add the explanation, it is implied.
So whose needs is the advisor addressing? Is he/she talking to the client about their needs, or is he/she talking to the client about their own needs? What images are they conjuring up, and what is the greater message they’re sending? What the advisor is saying to some degree is – it is all about me all the time and this is my primary concern.
When a client hears an explanation like this, how do you think they react inside? What questions are they thinking about? They are likely thinking, “Will this guy put my concerns first in the relationship, and can I trust him?” Your response to their question has raised doubt in their mind. Is this ever a good thing when it relates to trust?
What’s the alternative? Try using this phraseology instead:
I have a number of criteria that I use to determine whether or not a potential client is a good fit for me, and one of those things, and it’s not the only thing, is assets.
The solutions and services I provide to my clients are best suited for families or households with more than $500,000 in investable assets, though a good working relationship is tantamount.”
In the first statement, you are setting yourself apart from everyone else your client has ever discussed this topic with. You are expressing thoughtfulness and care by being concerned that there is a fit between you and the potential client. You have also stated that you have a number of criteria to determine fit between you and the potential client, and investable assets is just one of those criteria.
So whose concerns have we addressed with the second statement? We have dealt with this subject of investable assets in a very straightforward manner, and at the same time we have made a bold statement about where our loyalties lie. With this approach, you are saying that if you took clients with less than your minimum, it would really be doing them a disservice, as the solutions and services you provide would not meet their needs. You are expressing integrity, honesty and trustworthiness. You are not raising any doubts, and the client feels honored and privileged to work with someone who is concerned about, and who puts his clients first.
This of course cannot be just a statement by you the advisor, it must be backed by a consistent ‘fit’ process to bringing on new clients. This fit process should utilize a panoramic approach, considering not just Assets, but also Attitude and Advocacy.
The next time you are asked the question about minimums give this a try, and notice how people respond. They will have a new level of respect for you as an advisor.
This content, specifically the importance of an ideal client profile and a fit process, is covered in more detail in our Pareto Academy along with a complete range of essential practice management components.