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How Do Financial Advisors Get Clients? Doing Business with Friends

By Ray Sclafani | August 26, 2013

From afar, doing business with friends would seem to be a natural client-base and source of referrals for financial advisors. Yet, a significant amount of advisors avoid working with their close personal acquaintances, intentionally or not.

 

What we have observed is that advisors who work with their friends are able to successfully navigate through three distinct areas:

  • Building upon trust
  • The conversational pivot
  • Confidentiality first
 

Building upon trust. The ultimate value that you create with your clients is building trust. Think of all the relationships that you have built over your career(s), where your clients trust you implicitly. Now…think of your circle of friends, where a high level of trust is already established. Doesn’t it make sense to begin looking at these friendships in a more profound and different way…especially towards those who fully appreciate you and trust you? If not you, whom else will they work with? Someone who they trust less?

The Conversational Pivot. Finding the language to change the conversation with your friends can be key. Be sure to bring attentiveness, respect and authenticity to the conversation. This means being completely sincere in your desire to hold the relationship first...and being open to receiving a "yes" or "no" at any given moment in your conversation. A notable point: If you aren't willing to accept the possibility of hearing a "no", do not approach your friends. Although you don’t want to obsess about the exact words of this conversational pivot, and intention is more important than the words exactly, here are two conversational approaches that might be helpful:

 
  • “We have known each other for quite some time.  And I’ve never spoken with you about what I do professionally.  So, I wanted to ask your permission to have a larger conversation and possibly expand our relationship. I am very appreciative of you, and would never do anything that might jeopardize our friendship.  Would it be OK if we were to discuss a bit about your financial goals or concerns?”

  • “I want you to know that our friendship comes first. Up to this point, we haven’t had this discussion. However, with your permission, I’d like to have a short discussion to learn more about how I might be able to help you and your family, professionally.”

  • There are three keys to each of these outreaches. Ask permission to have a larger discussion. Ask questions of curiosity. Be genuinely yourself, and find words and phrases that are truly your own.

 

Confidentiality first. When you reach out to friends, there can be two levels of confidentiality. There’s the conversation itself around the details of your friends’ financial life. Confidentiality around these points goes without saying. However, there’s also the idea that you are even meeting together at all. This information, that a meeting is even occurring, is information that your friend can choose to share with others, or not. However, this is their choice and they should feel confident that this is entirely their choice to make.

 

One interesting paradox is that financial advisors who do not reach out to their network of friends can send out an unintended message to their friends that they are exclusive, and they don’t really want the business of the people that they could really help, i.e. the community of people who most like and trust you the most.

 

We trust this helps.

 

Topics: Client Acquisition Business Development

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