Kudos to financial advisors. 85% of today’s affluent rate their financial advisor as “very good” or “excellent.” And 80% consider their financial advisor a friend. That’s a significant improvement over the last 20 years.
It wasn’t too long ago that nearly 75% of the affluent told us that they didn’t have a personal relationship with their financial advisor. This was also at the same time that we discovered that affluent clients wanted their financial advisors to expand the standard professional relationship to include a personal element.
Being friends might sound like a “nice to have,” but there are tangible business benefits. 64% of those who are friends with their advisor referred three or more times last year, compared with 35% who aren’t friends.
Not all advisors have taken relationship-building seriously across their client base. If this is a need-area for you, here’s a simple exercise to get started…
- Identify your top 25 clients (you’ve likely already done this).
- Rate each relationship on a 1-5 scale (1 being not friends, 5 being close friends).
- Determine the last time you socialized outside the office.
- Make a priority list of clients who are overdue for social interaction.
- Determine a new face-to-face contact for each of them.
- Contact each affluent client and propose your face-to-face contact idea.
You’ve worked hard to earn the goodwill of your affluent clients (which is priceless). Amplify your referral flow by getting to know them more personally. The more you care about them, the more they care about you. Individual social outings serve this purpose well, but small events help you leverage your time even more effectively.
This year, 98% of affluent respondents report an interest in attending an intimate client event hosted by their financial advisor. Fun events are preferred, but educational events are a close second.
None of this is new. Social outings? Client events? Yes, but are you doing them consistently? Are you tracking your progress? There is a tendency when a good client relationship is established to assume it will remain that way. That assumption leads to an inordinate amount of time and attention given to high-maintenance (problematic) clients. Be careful in this regard. You want to be proactive in continuing to strengthen each of your top client relationships. Never take a healthy relationship for granted.
2023 Oechsli Research, n=1,005, $500,000+Investable