The Magnetic Power of Client Feedback

Julie Johnson and Whit Lanier Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.

Why has there been a reluctance within the advisory profession to actively collect, much less leverage client experience feedback? This article explores this historical avoidance and illustrates how to embrace the opportunities that the new SEC marketing rule affords us.

Many advisors worry about receiving complaints and the impact on their reputation, specifically in relation to BrokerCheck and/or a firm’s Form ADV. Most empathize with this concern, as no one wants to hear that their client is not happy, much less have that complaint memorialized in a public database. But, there are several reasons why collecting feedback is an immense benefit for you and more importantly, prospective clients – despite concerns about uncovering a complaint.

The SEC marketing rule permits the use of testimonials. With this new affordance, advisors must recognize that the competitive landscape has changed. If advisors revisit their stance on client feedback, they will understand why it has become imperative to seek client feedback and utilize testimonials for marketing purposes.

Consumers are paying attention too. Multiple studies show that investors rely heavily on what they read online before they reach out for a consultation. Even if they have received your name from a friend, client testimonials on your website increase the likelihood that they will contact you. A December 2021 study by Financial Planning magazine found that nearly half of respondents had removed advisors from consideration based on what they saw or couldn’t find in their digital footprints.