Financial advisers should start leaving out some of the numbers and rely more on storytelling during client meetings.
Presentation experts say financial advisers need to stop trying to make clients understand how alternative investments boost alpha, and instead spin more yarns about how families are successfully achieving their financial goals — with the adviser's help, said Bob Finder, author of “The Financial Professional's Guide to Communication” (FT Press, 2012). “Find ways of getting your points across using stories and analogies,” he said. “Facts are the first things that we forget.”
Advisers who follow this advice and other best practices for giving presentations can keep clients focused on the financial big picture and confident in their adviser to deliver the future they envision, experts say.
Other best practices suggest that advisers deliver concise presentations with energy and creativity, plan discussion topics and meetings carefully, and integrate technology to focus the client's attention.
“These client meetings are becoming increasingly important because clients are looking for an improved level of communication in their adviser interaction,” said Ray Sclafani, president and founder of Client¬Wise LLC, a financial services coaching firm.
Clients will be most engaged during meetings if the adviser eliminates “fluff and filler” and makes points clearly without too many details, Mr. Finder said.
The attention span of the average person is about 18 to 20 minutes, he said.
“One of the things I find with adviser presentations is, they are too wordy, too long — and they speak very fast,” Mr. Finder said. “None of that makes for great presentations.”
Darlene Price, founder of Well Said Inc., recommends that advisers energize their presentation style and be enthusiastic about the value they are providing. When she chose her own adviser from two with whom she met, she didn't select the one with the most impressive résumé. Ms. Price picked the one who was enthusiastic about improving her life through investing.
“If we don't connect emotionally, we stand a good chance of not gaining the client's trust,” she said. “That's what I see missing in most financial professionals.”
The way meetings are conducted has come a long way from the days when advisers used to sit down with clients and a pile of paper.
Client meetings used to involve the individual or couple signing “stacks of paperwork” and leaving disappointed that they didn't talk about what was important to them, said Alex Chastain, principal with Abacus Planning Group Inc.
Today, most administrative issues are handled through the mail or e-mail, and Abacus Planning advisers focus meetings around what the client wants to discuss, she said. Their advisers develop an agenda before the meeting from a “menu” of different topics, including taxes, insurance, estate issues, financial planning, updates to goals and family changes, and a portfolio discussion.
BEGIN WITH A REVIEW
At Russell Investments, Kevin Bishopp, director of adviser growth strategies, recommends that advisers begin with a review of the clients' key goals and show them where they are with regard to their planning and objectives.
“Demonstrate to your clients that you really understand what's important to them,” Mr. Bishopp said. Then move to any other planning topics such as college savings or estate planning. Don't save these items until the end, because they are too important and the client needs to be able to think and make decisions, Mr. Bishopp said.
Next, the adviser should review economic performance and, finally, discuss any specifics about investments or portfolios.
“Most financial advisers say they start quarterly reviews with the account statement or performance report,” Mr. Bishopp said. “Doing that, clients don't have a way to contextualize whether those results mean they are or they are not going to meet their goals.”
Advisers also have to think carefully about how to integrate technology into their presentations.
Peter D'Arruda, president of Capital Financial Advisory Group LLC, doesn't want to intimidate cllients, so he uses a large white board to draw things out and write down main concepts. He then takes a photo of the board and e-mails or prints it out for clients.
“I don't like to bombard them with technology,” he said.
Mr. Sclafani agrees that advisers have to consider different approaches with each client.
Using iPads to illustrate concepts and results might not work with some older people who find them hard to see or who may have negative attitudes about technology. At the same time, when meeting with a chief executive of a technology-based firm, “you better have the best technology available,” Mr. Sclafani said.