In a session at the Sage Advisory Perspectives on the Future 2015 conference, Gary DeMoss, a director at Invesco Consulting, shared research his firm conducted with focus groups on which words and phrases elicited a more positive response from clients.

Participants in the focus groups used dials to indicate a positive or negative emotional response to a typical advisor’s pitch.

DeMoss passed out to attendees cards with common phrases describing investment products or services printed on each side. Attendees were asked to indicate which phrase they though clients would have a better emotional response to.

  1. Do clients prefer to make voluntary contributions to their retirement plan or automatic contributions? Voluntary contributions elicited a higher emotional response (57 percent) than automatic (37 percent) because clients feel they retain a certain amount of control.

  2. Do they want to maximize their gains or minimize their losses? Respondents were twice as likely to respond positively to strategies that maximize their gains.

  3. Are “new and improved” strategies more appealing than those that “work as advertised”? Clients just want the products and services and technology they use to work the way they’re supposed to, DeMoss said.

  4. Are clients looking for long-term strategies or recovery strategies? Respondents were vastly more receptive to long-term strategies. “Even in the first week in March in 2009 they believed there was a long-term strategy that could help them get out of that mess,” DeMoss said.

  5. Do investors want strategies that are not correlated to the market or that are diversified? It’s probably no surprise that “diversified” was better received: 60 percent to 2 percent.

  6. Do your clients expect you to be experienced or knowledgeable? “Knowledgeable” resonated better with respondents than “experienced.” Experience is critical and desired by clients, DeMoss, said, but advisors shouldn’t use it as a “trump card.” In focus groups where the speaker started with his or her tenure in the industry, positive responses went down. That information should come later in conversations and marketing material, he said.

See also:

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