by Tony Vidler
It is a simple enough question but knowing what we are REALLY selling makes a profound difference to an advisers’ business success.
So what are we really selling? People in the industry tend to answer by saying “product”….people think they are selling insurance product, or wealth creation products, or taxation products….or sometimes they say “service”…trusted advice, planning skills, analysis…stuff like that.
Then the adviser themself being valued becomes an issue, and the adviser wonders why the clients do not value them. Personal loyalty from the cleint to the adviser is tenuous. Fee or price resistance exists. Advocacy by the firms clientele is virtually non-existent.
This is because the adviser hasn’t understood what they are really selling, or delivering, to the client which IS valuable.
The clients will rarely value the adviser when the adviser thinks the business is about selling products, because the adviser made the product the “valuable thing”, not themselves. And frankly, financial services products are not sexy desirable things in the main. They are a means to an end. Financial products are merely tools which help facilitate a desired outcome. They are tactical decisions rather than strategic objectives.
Thinking “service” is the value is a hard path. It is human nature to quickly accept any service level as initially fabulous, and then reasonably rapidly move to it simply being the current acceptable standard. In plain language; every time you increase the service standard and initially impress the clients, it becomes their minimum expectation in short order. So the practice is on a quest to continually exceed service expectations, and probably on a path to rapidly diminshing profitability. It is a tough game to win.
In a professional services business we are pretty much really selling one (or more) of these three things:
Clients will engage a service business because they are seeking a particular experience…driven by an emotion, and creating a moment in their life that will become a memory that matters. Holidays….tracing family history…..sailing a yacht….these are examples of experiences that matter to clients because they are moments that matter. We too can deliver experiences. Perhaps not as exciting as yacht sailing in sun-drenched islands, but we can provide valuable and valued experiences. I’d suggest that building a value proposition around experiences is the same issue for a practice as focussing upon being seen as a pure “service provider” – a tough game to win. Howeveer, if “experiences” is simply a small part of how you provide service, then that is a different thing. As long as it remains a “wow” factor it is valued, and the key to keeping experiences as “wow factors” is to not do them very often.
Closely associated with creating the experiences are the feelings that they generate, however feelings are not just about experiences. Peace of mind and calmness….control…..love….respect of their family….they are examples of the real emotional outcomes that clients seek when engaging professional advisers. Feelings are usually key drivers of continued engagement with financial advice. The wrong sort of feelings and clients leave. The right sort of feelings and clients stay. Really strong feelings created by the adviser and advocacy is created. So both the type of feelings created in clients and magnitude of them determine long term success for an adviser.
Often in advice businesses the primary driver for initial client engagement is convenience, or delivery. There is not a particularly high level of feeling attached to excellent dry cleaning services, or car washing, or completing tax returns. There isn’t for putting an insurance policy or retirement plan in place either frankly. The primary driver for the client is that the service either removes complexity from their life, reduces stressors, or it provides them with more time to do other things instead. It is convenient to give it to someone else to do. That adds quality to their own lives. But once it is done in their minds it is done, correct? Feelings associated with convenience tend to subside pretty quickly.
So we need to be mindful with newclients partricularly that the feelings associated with getting a problem or issue fixed convenientlymatter, but only in the short term really. We need to stay focussed on understanding and working on creating the feelings that matter over the long term for clients.
The Holy Grail for the professional advisory firm though is to tap into all three of these for their clients.
A service level from the business which is centered on creating convenience for clients at any level possible, but especially around initial engagement, is a starting point. Understanding the clients values and aspirations intimately in order to help create the feelings that matter, and then actively trying to create that outcome for them over the long term is the major objective. Coupling these with helping the client enjoy excellent experiences and using products that make sense for as long as it is sensible to use them adds up to creating great long term value for the client, and your firm. Maybe even creating advocates.
Simply selling products is a path to continual client-retention challenges. Selling “service” is a game of constantly chasing your own tail forever more. Either of these are possible, and there are plenty of advice businesses that exist like this for decades. But that is tiring. It is constant activity and hard work.
It is a far stronger and more enjoyable business for both the adviser and the client when we are attuned to how they want to feel…what emotions are driving them to forego some of todays lifestyle or money for a different outcome tomorrow. When you start selling those feelings-driven outcomes the business gets a lot easier to do.