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June 29, 2005 at 08:00 PM
The phrase “value-added service” is used quite often, but what does it really mean? How can advisors ensure that they live up to the promise?
The core of true “value-added service” is building a strong, trusting relationship with each client and business customer. Not only is it gratifying to build and sustain these relationships, it is important to the advisor’s reputation, ability to attract new customers and to the bottom line.
In the financial world, the strength of these relationships is more important than ever. Customers have more choices in products and more places to go to get them. Wholesalers, such as brokerage general agencies, can choose which carriers to represent and to whom to sell. And insurance companies can distribute their products through many channels, including independent brokerage, insurance marketing organizations, banks, brokerage houses or direct via e-retailing.
Each relationship needs to be nurtured, just as advisors and brokers need to nurture the end customer who buys the policy. The question is, ‘how to be best positioned to establish customer relationships firmly?’ Here are some suggestions:
1. Understand each customer and be proactive in meeting his/her needs. It is important to spend effort constantly to establish trust and improve upon mutual commitment. It is always less expensive to keep a customer than to bring him back after having lost him.
2. Establish mutual goals. Develop a joint business plan that clearly articulates goals, actions, accountabilities and timelines. Working toward a common goal will reinforce your commitment to each other. Routinely evaluate progress and recalibrate as needed.
3. Ensure honest, 2-way communication. Listen to the customer. Respond to problems quickly, offer insightful, constructive feedback, and ask for the same in return. Building mutual trust leads to solid business-client relationships. Only then will the client bring additional business, as well as valuable referrals that increase the firm’s network of customers.
