Putting your clients to work

The following is based on one of The Covenant Group’s clients. All of the names and telling details have been changed.

Chuck Sandar wanted to use his existing clientele to help him grow his business but his concept was flawed.

Chuck, a reasonably successful 46-year-old advisor who’d been in the business 20 years, felt he’d fallen behind his peers who all seemed to work less than he did and get better results. His plan for taking his business to the next level involved creating what he called ‘raving fans’.

As Chuck explained it, “My brother-in-law is one of the most successful tailors in this city. When he fits someone with a suit and sends them out the door, he knows he’s going to sell at least three more suits, simply because that person is going to show off their new suit to their friends. And it’s true, everyone, myself included, brags about how we have the best tailor in the city… I want to do that for my business.”

When I asked Chuck how he would create raving fans, he answered that his brother-in-law says the secret lies in creating the best suits and giving his clients a memorable shopping experience. And then they do the rest. So, Chuck planned to focus on creating expert financial solutions and making sure his clients enjoyed his time with them.

In my mind, Chuck’s strengths were his professionalism and his affable personality. I asked him, “You’ve been working hard for the past 20 years becoming an expert in your area; don’t you feel you provide a high level of service already? And don’t you think your clients work with you because they enjoy doing so? Why haven’t you already created ‘raving fans’? I don’t see that your brother’s service is any better than yours.”

Chuck agreed I had a point.

“Chuck,” I said, “your example of your brother-in-law is an interesting one, but there’s more to it than meets the eye. If we want to draw a lesson from him, we have to reexamine what is really going on. According to you, after your brother-in-law’s clients buy a suit, they go around showing them off.”

“Yeah,” Chuck said, “the same way people brag about their new car or new laptop.”

“But, Chuck,” I said, “I don’t think bragging is what’s really going on.”

We’ve all heard about buyer’s remorse. The act of making a significant purchase increases our tension level. While we may not always get ‘buyer’s remorse’, our tension is increased and we need to find ways to relieve that tension. Many of us do so by looking for confirmation that we’ve done the right thing. When we show off our new suit to our friends and they say, “wow, great suit, great deal” they are helping us feel better about our purchase, helping reduce our tension.

Everyone in a sales role must understand the psychology of buying and selling. What happens at the point of sale is particularly important, because that’s when the seller and the buyer become diametrically opposed. While tension is increased for the buyer, it is decreased for the seller. For the buyer, attention is focused on the purchase; for the seller, attention goes elsewhere. The buyer views the sale as a favor bestowed upon the seller; the seller views it as something earned. And while the buyer feels doubt or remorse, the seller feels excitement.

How that point-of-sale dissonance gets dealt with has a huge impact on the salesperson’s business. If that dissonance gets resolved, the salesperson will gain, if it continues, lingers or worsens, they will suffer. Fortunately for people who sell tangibles like cars, suits, technical gadgets, the buyer often willingly and unwittingly does a lot of the work to reduce their tension level — by, as we’ve seen, showing off their purchase to others. Alternatively, if they’re unhappy about their purchase, they’ll go around complaining to their friends, increasing their tension and creating a bad reputation for the seller.

However, we, can’t leave things up to the buyer, because we know that people rarely go around bragging about intangible purchases like their investment plan, their readjusted asset allocation, their disability or life insurance. And that’s a serious problem for anyone in the business of selling these services, because it means that the client isn’t going to do any of the work to reduce their tension. So, without a strategy on the part of the advisor to deal with the dissonance, the advisor’s business will suffer.

Chuck asked me how an advisor should deal with their client’s dissonance.

“Advisors need to look at ways to help their clients affirm the purchases they’ve made. And one effective strategy is to follow a process for obtaining introductions.”

Each step of the process for obtaining introductions is designed to help the client affirm they’ve done the right thing. Your first step is to confirm your client’s confidence in your work. You can do this by asking something like, ‘John, now that you’ve had the opportunity to work with me, how do you feel about what we have accomplished?’

Here, instead of leaving them to walk out the door and deal privately with their doubts, you are connecting with them. You want to encourage your client to be frank, and if they are less than positive you need to explore why before moving on.

Your next step is to describe your ideal client. Here you give the criteria you are looking for, such as level of success, family values, etc. Because you are describing criteria your client meets, you are again helping affirm their decision.

You then help your prospect identify people they know who also meet your criteria. After that, you ask them to introduce you to those people.

Most advisors talk about asking for referrals. Whereas a referral is generally considered to be a name and telephone number or address of one of your client’s friends, an introduction is an actual meeting. In an introduction, your client introduces you in person to your prospect. You could suggest your client arrange a lunch or breakfast. If time is an issue, suggest meeting for a coffee or inviting them both to a seminar you are hosting.

After the introduction is made, you must keep your client informed, but obviously in a way that doesn’t contravene client privacy.

Chuck interrupted me, saying he didn’t see how getting introductions would help affirm the client’s buying decision.

“Chuck,” I said, “By working with the friends and associates of your clients, you are reinforcing the idea that your client has done the right thing — if their friends are doing it, it must be right. Furthermore, you are increasing your client’s investment in your relationship. They are tied to you, not simply as a client, but also as a friend of another client. You’ve now built a complex network, where each party is connected directly and indirectly. Your new client is grateful to your old client for the introduction to you. Your old client is grateful to you for helping out their friend. And you are grateful to your old client for helping you gain a new client.

So, instead of leaving your client in the cold after a sale, you have added great depth to your relationship.

Chuck saw that obtaining introductions, not trying to create ‘raving fans’, was the way to build his business. He spent the next few months applying this strategy. By the end of his fiscal year, his revenue was up 30%.

Lessons Learned

Chuck learned that his concept of growing his business by creating ‘raving fans’ would never work for his financial services business. Unlike the clients of his brother-in-law the tailor, Chuck’s clients weren’t going to go around bragging about their new asset allocation plan. Chuck learned that if he wanted to get his clients to help grow his business, he needed to better understand the psychology of buying and selling. He discovered the point of sale essentially drives a wedge between the advisor and the client. For the advisor, the sale is an end; but for the client it is a beginning. Whereas tension is reduced for the advisor, it is increased for the client. The tailor’s clients help reduce this tension by showing off their new suit to their friends, but because Chuck’s clients don’t generally talk about their financial services purchases with their friends, their tension never gets reduced. Chuck needed to apply a strategy that would reduce his client’s tension and help build his business. His answer lay in applying a process to obtain introductions, which would help the client affirm they’ve done the right thing and deepen the relationship with the client by working with the client’s friends and associates.

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Article was written by Norm Trainor, Founder and CEO of The Covenant Group. 

The Covenant Group is referred to by many as the place entrepreneurs go to become Business Builders. They are considered to be thought leaders and have authored the best-selling books, The 8 Best Practices of High- Performing Salespeople, The Entrepreneurial Journey, and The Business Builder.