Do you know what your clients expect from you?

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

Cam Lotti had recently moved upmarket and started working with some affluent clients, but he couldn’t figure out why he wasn’t making more money.

When er asked Cam what he thought the problem was, he mentioned that while he’d gained a handful of big accounts he’d lost a few mid-sized accounts, something he wasn’t used to. We explained to Cam that “we don’t like hearing you’re losing clients,” and asked for an example of an account he’d lost.

He told us about his sister’s fiancé, Roger, an articling student eager to begin an investment plan. “A couple of months after getting Roger started on a monthly withdrawal investment plan, my sister began asking me when I was going to get together with Roger again. I hadn’t planned on seeing him and I was really busy so I didn’t call. Another few months go by and the next thing I know I get a letter from Roger asking me to transfer his funds over to another broker. When I spoke to Roger he said he wasn’t thrilled with my service.”

“Why?” We asked.

“He said he’d expected more contact from me letting him know how his plan was going. I apologized, mostly because I didn’t want to start a family rift, but in reality, I thought Roger was way off base. He was one of my smallest accounts. There was no reason for me to keep in touch with him.”

Poor service quality was a central theme in the other accounts Cam lost, which, though mostly small and mid-sized ones, were in the aggregate enough to offset the gains on the big accounts.

“You know,” Cam said, “I was really run off my feet last year. I know I wasn’t getting to things. I was putting a heavy push on growing my business with small business owners. That was my priority and I paid the price, I guess.”

“Cam,” we explained, “you certainly pushed yourself beyond your capacity to deliver quality service to your clientele, but I think something more fundamental than a lack of time is going on.”

Cam asked me to explain what I meant.

“I think the problem is you have a transactional approach rather than a service approach.”

Cam hotly disagreed, saying that superb service has always been his hallmark. “I’ve had great retention over the years,” he said. “Most of my clients love me. This was just a bad year.”

“I don’t agree,” we said. “Otherwise we don’t think you’d be in the boat you’re in. Let’s take Roger for example.”

“Roger’s expectations were unrealistic,” Cam said defensively.

“Maybe so, but you didn’t find that out until it was too late. His expectations should have been something you explored during your initial meeting. We don’t think you did that. Your objective was to handle his immediate transaction and worry about the service later.”

Roger shrugged.

“Otherwise, you and Roger would have agreed on what service to expect.”

“But there was no way I could have made Roger happy. He was looking for someone to speak to him on a monthly basis.”

“You can't assume that just because of what happened. If you had shown Roger the benefit of working with you and clearly communicated a service promise and then delivered on that promise, you might still have Roger as a client.

“Cathy, a real estate broker recently lost a sale over a similar problem. After a month of working hard to sell a house, the vendor called up and said he was switching to another agent because he didn’t think she’d given him great service. She was floored. She’d been working her tail off, networking with dozens of agents to find a buyer, running open houses every weekend, advertising the place.”

Cam asked what the problem was.

“Her client said she rarely talked to him, didn’t keep him in the loop. Cathy said he wanted to know everything she was doing, how every open house went, whether there were any interested parties. I asked Cathy why she didn’t communicate with her client. Two reasons, she said. ‘One, I literally don’t have the time. And two, if I tell him every time someone expresses interest and then they don’t buy, that’s frustrating. I don’t want to send my clients on a roller coaster, getting their hopes up and then watching them crash. I just want to focus on selling the house. If he wants an agent to baby-sit him, then he’s probably better off with someone else anyway,’ she’d said.

“We explained to Cathy her problem wasn’t that she didn’t talk to the client, but that the client’s service expectations didn’t meet the service delivered. If she had laid out what she was going to do and the reasons for it, I’m sure she’d still have him as her client.

“Cam,” we explained, “like Cathy’s client, some of your clients may have unrealistic expectations. They may not understand what objective your service is meant to achieve or be familiar enough with the financial services business to know what level of service is reasonable. In Roger’s case, he didn’t fully understand the long-term nature of your plan for him. As well, he might have thought that as a relative you would give him special attention even though his account was small. Ultimately, Roger’s unmet expectations inspired him to end the client relationship. But imagine if, in the beginning, you and Roger had had an open and frank dialogue about the service you were going to deliver. You could have explained then that he should expect a phone call or a face-to-face meeting, or whatever your service plan calls for, once a year. You could have explained the rationale for your service and told him that because the investment plan is a long-term one, that unless something unexpected happens, you are not going to report to him on a monthly basis the status of his investments. Roger would have told you then whether or not that level of service worked for him. The point is, you both need to go into the relationship with a clear understanding of what to expect.

“Cam,” we explained, “in your early years in the business, you likely delivered good service, but not because you had a service plan. Your clientele was limited and so you had the time to service them. But now that you are moving into new markets, you need to develop a service plan, one that reflects different levels of clients. Obviously, your more affluent clients are going to expect, and deserve, a higher level of service than clients at Roger’s level. You need to map out what your service promise is for your various client levels and you need to make sure you get agreement from your clients at the beginning of the relationship.

“Right now, you don’t know how many Rogers you have in your client base. There could be others for whom you are not delivering what they expect.

Cam agreed he’d been putting his client relationships at risk by not having nor communicating a service promise. Over the next couple of weeks, he segmented his clientele and developed a service plan for each segment. From then on he sought agreement on service expectations with every new prospect. As well, over the course of the next year, he contacted each of his existing clients and outlined his service promise, which, he said, inspired a high degree of client loyalty and opened up new business opportunities. At the end of the year, he found he no longer had a retention issue and was thrilled to see that his revenue had grown twenty percent.

Lessons Learned

Cam learned four important lessons about service:

• Unless you explore with your clients at the beginning of the relationship what they expect from you, you are putting the relationship at risk. If you don’t deliver what they expect, they will see you as a poor advisor.
• Clients are not to blame for their unrealistic service expectations, which may be due to a lack of knowledge about your business and/or a misunderstanding of what objectives your service is meant to achieve.
• Most clients will agree to your service level if it is clearly communicated upfront and if a rationale for it is given.
• You will avoid losing clients to unmet expectations if you set service standards, gain your clients agreement to them and deliver on the promised service.

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