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How to Build Trust and Long-Lasting Client Relationships

10 April 2018
1 min read
How to Build Trust and Long-Lasting Client Relationships
| Managing Director—AB Advisor Institute

Today’s high-net-worth clients are more sophisticated than ever. A massive number of financial advisors and consultants are knocking at these clients’ doors, sending emails and calling trying to get their business. Social media, advocacy groups and regulatory agencies are bombarding them with news about unscrupulous, incompetent and overpaid advisors.

There’s also a growing belief that financial advisors have little or no impact on a portfolio’s performance (as evidenced by the accelerating cash flow into inexpensive, passive investment vehicles). This means you can no longer assume clients are satisfied with a positive performance number at the bottom of their monthly, quarterly or annual reports. Clients think a rising tide lifts all boats and if they didn’t pay you a percentage (and maybe even a fee), their returns would be even higher.

So how do you prove your value when performance doesn’t drive client satisfaction? What matters to clients now? I believe the answer is protection: making sure nothing’s missing that can hurt the client and nothing’s missing that the client should be taking advantage of. In essence, an advisor must act like a guard dog or home security system.

The Right Level of Protection

We know that all security systems aren’t created equal. When assessing your value, imagine clients asking two questions: “Are you great at what you do?” and “Under your watch, can I be confident that the future I want is the future I’ll get?”

You can answer both questions thoroughly by providing expert technical knowledge on capital markets, risk management, tax management, wealth-transfer strategies, documentation management, and wealth-management plans and by explaining how these factors help achieve a desired future.

A business model based on this value proposition is uniquely positioned to satisfy skeptical clients who have achieved unique levels of success.

The views expressed herein do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams.

About the Author

Kenneth Haman is the Managing Director of the AB Advisor Institute (AB AI). AB AI provides insights from the behavioral sciences, including behavioral finance, to client-facing financial advisors to improve their marketing outreach and relationship-building efforts with investors. Haman began his current role at AB in 2005. Prior to this, he managed a psychotherapy practice in the Washington, DC market for 20 years. Haman holds a BA in business administration from Lebanon Valley College; an MDiv from Princeton Theological Seminary; an MAPC from Moravian College; and certifications in clinical hypnosis and neuro-linguistic programing from the American Hypnosis Training Academy. Location: Nashville