Unlocking Real Value Blog

What Clients Want

Our last blog talked about the disconnect between clients and financial services professionals when it comes to the importance of ethics. Client views were obtained as part of a survey sponsored by the CFA Institute and entitled “The CFA Institute & Edelman Investor Trust Survey.”

The survey also asked respondents which of the following factors was the most important to them in selecting an investment manager (while the question in the survey related to investment managers specifically, but I would argue that the results are relevant to advisors and other industry participants as well):

  • Trusted to act in my best interest – 35%
  • Ability to achieve high returns – 17%
  • Commitment to ethical conduct – 17%
  • Recommended by someone I trust – 15%
  • Compliance with industry best practices – 8%
  • Amount/structure of fees – 7%

By more than 2 to 1, more respondents felt that the most important thing to them in picking an investment partner is that they feel that they can be trusted to act in their best interest. Returns were less important, and fees were at the bottom of the list.

These statistics reinforce the notion that trust is the most important thing in our industry (if you add the 17% who mentioned ethics, those two issues represent the most important thing to more than half of the respondents). Investment managers and others who fail to establish trust first – before they talk about what they do and how much they charge – are putting themselves behind with, on average, one out of every two prospects they will speak with.

This issue resonates with clients as well. While establishing trust and demonstrating ethical behavior is the key to getting clients, industry participants must reinforce this trust as the relationship matures in order to keep the client.

This issue reminds me of the old lesson that the best salespeople speak the least – they listen more than talk. I think the same goes here. The best advisors, consultants and money managers will allow their clients and prospects to talk – tell them what is important to them, what worries them, etc. – and only then will they talk. Listen and you shall prevail.


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