Women are more valuable clients then men.
When a female client is happy with your services — whether you design home interiors, cut hair or provide financial advice — she is much more likely to recommend you to her friends and family, according to Kathleen Burns Kingsbury, a wealth psychology expert who helps advisers serve clients better.
In fact, over a lifetime, women will make 26 referrals to their financial adviser on average, compared with 11 by the typical male client, she told an audience last week at the IMCA conference. The figures come from a marketing study by author Delia Passi.
“If you do the right things, and in a way that fosters trust in female clients, they will connect you with their friends,” Ms. Kingsbury said. “They are huge referrers.”
The trick for male advisers — who make up about three-quarters of the financial advisers in the country — is figuring out the appropriate way to deal with female clients. And getting that relationship right will only become more important in the future. Women are creating and controlling more wealth, and as the baby boomers age, they will control still more. Why? Because husbands on average die seven years before their spouse.
“We know the statistics,” said Eleanor Blayney, a former registered investment adviser who now runs consulting firm Directions for Women. “Even if women didn't create the wealth, they end up with it. Every financial service provider is scrambling for position on this issue.”
A QUESTION OF TRUSTThe key to winning over female clients is T-R-U-S-T, Ms. Kingsbury said, putting it in the form of an acronym. “Women are wired for connections. We are all about relationships.”
Five key elements to build that trust are:
• Transparency. Be upfront about fees, biases and investment processes.
• Reliability. Follow through on what you promise.
• Understandability. Women — and men — hate investment jargon, so speak in plain English.
• Sensitivity. It is essential to demonstrate sensitivity to a woman's needs and emotions.
• Thoughtfulness. Details are important for women. Following up on conversations and sending quick notes on matters discussed can mean a lot.
Women may naturally be more adept at demonstrating empathy and sensitivity than men. But you don't have to be female to be a good financial adviser to women.
“There may be some natural advantages for women advising other women, but if you understand and learn what women need, you can have success,” Ms. Kingsbury said. “In my experience, women often want male financial advisers.”