A shift in the financial market is taking place, and it seems many advisors are choosing to ignore it, despite the unfavorable affects it may have on their business.
Not only do most today’s women control their own finances, they’re also the primary consumer and positively or negatively influence 85 percent of all purchases. So, if you think it’s unlikely that you will need to worry about appealing to women as a financial advisor, you’re very wrong.
The “classic” selling techniques are handicapping the success of financial advisors. Historically, the financial services industry has been trained by men to primarily advise other men. Advisors have likely been trained to understand a man’s logic, a man’s needs and a man’s concerns. The big issue is that women are most definitely not like men.
The worst industry serving women
New statistics suggest the financial services industry needs a change and advisors may struggle with it, especially if they’re comfortable with the status quo. The Harvard Business Review recently revealed that the financial services industry has been rated the worst industry in serving women. More than 90 percent of women report an overwhelming unhappiness with the financial services they’re receiving, stating that their advisor is unsympathetic and detached when it comes to understanding their needs. The lack in desire to change is a major contributor as to why the industry is falling short in customer satisfaction.
When working with women, advisors should:
- Clear their schedule in order to give the client 100 percent attention with absolutely no interruptions. Women want to feel engagement, a minor distraction may leave women feeling slighted.
- Keep eye contact and listen while the client is speaking. Women want to know that their advisor is present and interested in hearing their expectations and concerns.
- Save financial advice until addressing their wants, needs and fears. Let everything the client said really sink-in before providing financial suggestions.
Advisors should slowly implement these practices to help increase positive customer satisfaction within the financial services industry. It’s especially important that women clients are satisfied because women will be in control of a large portion of the country’s financial assets in just a few short years.
Related: An undersold market
Historically, the financial services industry has been trained by men to primarily advise other men. But that sales model is no longer well-suited to today’s clients and prospects. (Photo: iStock)
Women with wealth are adding up
Women worldwide control $14 trillion in personal wealth and are expected to control more than 60 percent of the United States’ wealth by 2030. Last year alone, six out of 10 bachelor’s degrees were earned by women and GoGirl Finance recently reported that by 2028, the average American woman is expected to out-earn the average American man. These are hard-hitting statistics that the financial services industry can’t afford to ignore any longer.
Agents will continue to see a rise in female prospects every year. In the next ten years, baby boomer women are expected to receive a huge windfall of assets from their parents and/or spouses. Women, due to superior longevity, will more than likely outlive their husbands. In fact, nine in 10 women, at some point in their life will be the sole financial decision maker for their household, which is concerning given that seven out of 10 women leave their current financial advisor for a new one when they become widowed or get divorced. To ensure women clients don’t walk away, advisors should:
- Include them in the decision making process. Women want to know why they’re doing something, not just what they’re doing.
- Provide them with education. When women are left in the dark, they’ll run.
- Speak from personal experience. This will allow them to feel comfortable with decisions you’re guiding them towards.
While you may be thinking that your clients could never leave you, it’s important that you make the changes to ensure they would never leave you. Remember, a client satisfied with services will shout it from the rooftops.
Referrals rise with women clients
Women clients are a substantial gain to an agent’s practice. While many agents report that appointments with women seem to take longer than average, it’s important to make time. It may be beneficial to allot an additional 20 minutes when meeting with women over men. The more an agent listens and positively helps a woman, the more likely she is to refer the agent to her family and/or friends. In fact, women refer good services to their loved ones nearly 3 to 1 over men. Agents will see an increase in referrals from women if they:
- Stay in touch. Women love to know what is happening and why it’s happening. You can never over communicate with women.
- Follow through on promises. Even following through on a little promise can go a long way.
- Closely monitoring the account. If women truly feel like they’re the only client of the agent, happiness will ensue.
Statistics on women and money are readily available and financial advisors should be unburying their heads from the sand to take a good look at their business practices. In many circumstances, it will take just a few adjustments to your sales approach, marketing, dialogue and content. Like most things in an already growing business, making huge adjustments all at once is not the answer. Tackle things one at a time and you’ll watch your business grow year-after-year.
Gina McKague is president of McKague Financial in Livonia, Michigan.
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