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Financial Planning > Behavioral Finance

Find Success in Consultative Solving

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The ride slows. The lights rise. The restraints release. The attendant repeats, “Exit to your right.”

Off you go, straight into the…souvenir shop.

There’s no avoiding it. No matter how scant your interest in keepsakes, you ride the ride and, ultimately, must run the retail gauntlet. The park operator directs you exactly where they want you to go.

For amusement parks, that may work. For financial professionals, not so. Not in today’s world.

The ride is over for cookie-cutter approaches and hard sells. Information is everywhere. Empowerment is key. Customers no longer accept “one size fits all.” Twenty-first century consumers expect control, flexibility and customization.

What works are solutions—personalized, well-considered, carefully crafted solutions. And embracing that reality is crucial to consultative selling.

What clients really want

Clients look to you for financial solutions that fit their lives—today and down the road. Crucial to helping them pursue their goals is managing fundamental “LIFE” retirement risks, such as:

  • Lifespan – As the longevity carousel goes on and on, can your income keep pace?
  • Inflation – The cost-of-living sky ride gradually lifts prices higher and higher.
  • Fluctuation – Assets climb, plunge and loop on the market volatility rollercoaster.
  • Experience – As surprises await in the life events funhouse, can plan flexibility respond?

Unearthing the facts of a client’s situation, and the motivations that have brought him or her to you, isn’t easy. Many people aren’t at all confident in their understanding of financial matters. On top of that, financial affairs are deeply personal. People have a hard time discussing them with anyone.

That’s where consultative selling makes the difference. Characterized by the use of fact-finding techniques to gain deeper knowledge of clients, consultative selling—also called relationship selling, needs-based selling or customer-centered selling—isn’t new. Perceptive businesses understand that content selling doesn’t connect with consumers. Financial services providers have observed that reducing products to a laundry list of features and benefits fails to motivate prospects.

The answer? Gain personal knowledge of the client. Build confidence by making a real connection on an individual level. And from the insight gained, tailor an individual solution. When your client feels as though you understand them, confidence has reached the tipping point. 

Getting to know you

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A doctor doesn’t immediately write a prescription. A mechanic doesn’t overhaul an engine right away. Fact finding comes first.

Consultative selling likewise starts with genuinely getting to know a client. Understanding someone’s situation, concerns and aspirations—in detail—sets the foundation for addressing financial needs.

Discipline yourself to follow these points as you interact with clients:

  • Be present. Now’s the time to really listen, not just wait to talk. Maintain eye contact. Pay attention to nonverbal clues, such as tone of voice and body language. Practice patience.
  • Ask questions. Your questions reflect how closely you’ve been listening and show your true interest. Ask open-ended questions that can deepen and further the conversation.
  • Reframe and repeat. Summarize your understanding of what you client is saying. Be alert to the emotional words that convey the underlying message.
  • Ask more questions. Follow up on responses. Draw out details. It’s tempting to immediately offer your take on how to “fix” the problem. Move too soon, in response to a superficial concern, and you may never get to the deeper underlying need. 
  • Stay focused on them. Try not to interject a scenario of your own (“That’s just like the time …”), unless you can quickly bring the conversation back to your client. Make certain you hear and understand your client’s point of view first before you move to opinions and advice. 

Don’t get ahead of your client. Work to gain awareness of the challenges they face. Note their life events and the risks associated with them. Encourage the client to lead the way to what matters most to them.

Like many approaches, consultative selling often is professed more than practiced. But employing it can yield impressive results.  Both parties benefit when you advance a solid relationship. Leave prospects impressed with your attitude and your expertise.

Talking = telling. Listening = learning.

Which do you do most? A financial professional’s first goal should be to establish a foundation of confidence. Values must be identified before features are presented and benefits explained.

Financial matters are deeply personal. Often they have less to do with expected likelihoods and more to do with personal preferences. Extracting this information from clients is where you add real value.

The process of building meaningful connections is time consuming but essential. Facets to be analyzed include the client’s circumstances, objectives, implications and needs. Exploring the situation and pinpointing problems, the consultative professional helps clients grasp possible implications and discuss actions most appropriate for their circumstances.

Be it an amusement park or a financial institution, extremely satisfied customers drive financial results and repeat business. The same holds true for a financial professional. The first step to creating loyalty is to understand what your clients need and want. Employ consultative selling to build an authentic relationship over time and you will create loyal clients for years to come.

Consultative selling is about relationships, not transactions. You’re not just selling a product; you’re building a client base. Build it strong enough to last!

Mark E. Caner, MBA, AEP, ChFC, CLU, CFP, is the president of W&S Financial Group Distributors, Inc., the national wholesale distribution agency for annuities and life insurance for Western & Southern Financial Group, based in Cincinnati, Ohio.