The day you started in the business, someone told you: “Go after your natural market.” Family and friends are at the center of this group. You were wary of a “one size fits all” approach because you have all sorts of friends, near and far, new and established. What do you do?

7 Stages in the Development of Relationships

Most people you know (except your parents!) start at the beginning and gradually move through these steps. Many relationships stop at one stage! Although we describe many people as friends, a more accurate description is “People you know.” Let’s get started.

Stage 1: Strangers.

Who: Someone you met a party. Maybe you asked a client for a social introduction to a potential prospect. They often ask: “What do you do?”

Your approach: You might say: “I’m a financial advisor at (firm). You probably work with an advisor already.”

Strategy: They have three possible answers. Yes, No and everything else. “No, I don’t have an advisor” might imply they think they are smarter. Tread carefully. Staring at you and saying nothing might imply: “I’m suspicious of you and not cooperating.” Change the subject. Yes is the answer you want. You might ask: “What do you like best about them? Would you recommend them?” Draw them out about the quality of the relationship.

Stage 2: Acquaintances

Who: Commuters on the same train. Fellow parents with children in the local school system.

Your approach: Find a common issue. Discuss it.

Strategy: Let’s assume the common issue is young children. You mention yours, confirm the ages of theirs. Everyone wants to provide the best education possible. This costs money. You found a savings solution. What are they doing to address the issue?

Stage 3: Sharing Similar Interests

Who: You are a gym regular. You see the same folks four times a week. You nod and wave.

Your approach: You want to tell your story by raising your visibility.

Strategy: Buy tasteful workout gear with the firm logo. Wear one logoed item at a time. Read the Wall Street Journal on the elliptical machine. Stand and watch CNBC when resting between sets. If it’s not on, ask the manager to change channels. Pay attention to everyone else’s tee shirts. Ask questions based on the message or logo on the shirt. Learn who they are, what they do and where they work.

Stage 4: Friendship

Who: These people are actual friends. You spend time together. You have history. You call them to go out and party.

Your approach: Endeavor to tell your story by asking about their job first.

Strategy: Find a spontaneous private moment. Express an interest in what they do. Tell them what you think they do. Listen. They will likely ask what you do. If not, you might use a strategy that’s been around forever: “When you tell your friends about me, what do you say that I do?” Listen to their answer and shape it toward your elevator statement.

Stage 5: Trust

Who: Friends you’ve known quite a while with a high level of comfort. You’ve never discussed business.

Your approach: You’ve assumed the risk to friendship issue is why they never brought up business. You lead with it.

Strategy: Explain you never brought up business because you don’t want to put the friendship at risk. It’s too important. You assume they work with someone who takes great care of them. You want to explain what you do in case they know some people. Give a couple of scenarios including one that fits them. They have likely decided on their own if they would do business. They trust you, but were waiting to be asked. You are tactfully asking.

Stage 6: Identify a Key Issue

Who: This person is close enough to share confidential personal information.

Your approach: Try to help, even if the solution doesn’t directly involve doing business.

Strategy: Bring up the need. Show your understanding. You think you might have a solution. Asses their level of comfort. If it’s there, proceed by viewing the situation as an objective third party. Offer to do something. This will likely involve selling the firm, not yourself as a solution provider. Do a good job and follow up tactfully afterward if they haven’t made a decision.

Stage 7: Reintroduce What You Do 

Who: A close friend. You speak frankly. They have told you they work with a competitor.

Your approach: You want to compete for some of their business.

Strategy: Mimic what they likely do at work when it’s time to review vendor contracts. Confirm the type of investing they do elsewhere. Your firm offers it too, at competitive prices. Ask when they meet with their current advisor to review the account. Can you meet with your friend a few days beforehand? Explain the amount of money you are asking for and what you would do. Hopefully, there will be money in motion when they meet with their current advisor. Can they send some your way?

Action Plan

Different levels of friendship require different approaches. Who do you know? List them under each stage. Get to work. Most important of all, ask your friends at or beyond step five for business. They trust you. They’ve likely made up their minds and are waiting to be asked.

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