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Our clients have been bombarded with an endless stream of negative economic news and dire predictions. They are told the economy is down, then teased with signs that it is beginning to improve, only to have those reports discounted days later with updated news of pending economic disaster.
Let me end the speculation for you – things are not going to turn around or bounce back. But a new economy has emerged, and advisors who understand its dynamics can win over clients more easily.
In this new economy, the consumer is in control. What advisors sell is a luxury, and an advisor’s competitive advantage is how he or she sells it. Success depends on your ability to build and expand relationships in what I call the “trust and value” economy.
Before the economic downturn ushered in this new economic reality, we were in a “product and service” economy. A business provided a product or service, and then consumers chose whether to buy what the business offered. And that was that. We had the luxury of taking our clients for granted.
Today, financial advisors trying to play by the old rules are suffering the consequences. Our products and services have become commodities, and the consumer is in control. With technological advancements, increased competition and globalization, finding a product or service has become the easy part. It isn’t enough anymore just to offer a quality product or superior service.
Success in the trust and value economy is more about understanding your clients than about predicting market fluctuations. You have to build trust and consistently add value by listening more, reacting less and engaging at a new level. Success in this economy is about creating an experience that not only meets clients’ needs, but also blows their minds. Your ability to succeed is directly connected to your ability to stand out and be memorable.
Five tips to win over clients in the trust and value economy
Here are five ways you can win in the trust and value economy:
1. People buy what they value – regardless of price
If your clients leave you over your price, it is because price was all you were selling. People choose price when there is no other option – and that’s especially true in the trust and value economy.Think about the American public. Why do people buy organic produce, pay for an upgrade on an airplane or pay for water in a bottle? Each of those products is more expensive than their ordinary counterparts – regular produce, economy class or tap water. People pay more because they perceive value. They perceive value because they have been sold value. In other words, unless you help your client understand the value you bring the table, he or she will most likely take it for granted. In the trust and value economy you have to sell, explain and consistently remind your clients and prospects of the value you add.