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February 01, 2003 at 02:00 AM
When I visited a financial advisor in New York City recently, I noticed on my way to her conference room that all the rookie brokers in the cubicles around me were on the phone, apparently arguing with the person on the other end of the line. Some of the brokers were literally yelling, trying to hammer their prospects or clients over the head until they bought something.
When I went in to talk to the branch manager about it, he responded, “Yeah, these New York investors are tough cookies. You really have to know your stuff, be persistent, and sell hard.”
But I think these brokers were having the wrong conversations, and with the wrong people. Many people in this industry seem to believe that their job is to convince people to do things they don’t want to do by overwhelming them with data. Clearly, you need information to be effective in this industry. But my experience has been that the more information you give clients or prospects, the more confused they get–and a confused prospect will not sign on the dotted line. People don’t really care how much you know until they know how much you care.
Hard Data vs. Soft Data
Most financial advisors are taught to gather data during an initial interview with a potential client. But they often don’t realize that they’ve been taught to gather a specific type of data, which I call “hard data”: information about the potential client’s investments, age, goals for retirement dates and retirement assets, number of children, and other quantifiable information. This information is typically entered into a computer program, an analysis is done, and the resulting recommendations are presented to the prospect.
What’s missing in most initial client interviews is the “soft data.” There aren’t any off-the-shelf forms for this information. This is the subjective information about the client’s hopes and dreams for the future, their fears and concerns, and the emotional issues that motivate human behavior.
The Power of Caring
One of my favorite stories about information versus caring comes from Steve, whom I coached when he was a brand-new advisor. As part of his training, he conducted a mock client interview with his dentist, using some “soft data” interview questions I’d come up with.
This data is not entered into a computer. It is not used to prepare an analysis or proposal. Its purpose is simply to help the advisor understand the prospect so that, if the prospect is interested, the advisor can help the prospect get what he wants.
The interview took about 90 minutes. Remember, Steve did not know the dentist very well, and during the interview, he hardly said a thing about his new job. When he completed the interview, he thanked the dentist for his insights and prepared to leave.
The dentist stopped him. “Steve, can I ask you a question? Can I become your client?” Steve blinked. He had told the dentist that he was doing this interview as part of the training for his new position. “I’m not licensed yet, so I’m not able to take on any clients yet,” said Steve.
“Well, how about once you get licensed?” said the dentist.
“I’m going into management and probably won’t have any of my own clients,” Steve responded.
