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The news is littered with headlines talking up the volatility in the markets as coronavirus fears have sapped the market of its bullishness over the last two weeks. We've seen the market swing upwards on alternating days with downward spirals in between. It's enough to make investors jittery and make even the most long-term minded investors double-check their portfolio allocation strategy. No one knows to what depths this virus will drive the major market indices, but one thing is known: financial advisers can make or break their client relationships by how they respond in times like these. Assert your role deftly and you can have clients for life - and they'll tell their friends about you! - or, fumble the situation by underestimating the impact or the level of client concern and you'll see your client base head for the exits looking for something better.
In the big picture, volatility should be seen as a long-term marketing opportunity for RIA firms.
Let me explain. Most people hire their adviser because they have a life goal in mind. Maybe they want to save and invest enough to eventually retire. Or, they want to create enough financial flexibility to buy a dream home or take a vacation of a lifetime. But there is SOMETHING that drives them to hire an adviser -- the desire to make the most of their finances. It comes with the inherent belief that WITH the adviser, their likelihood of achieving that goal goes up. The actual benefit can be broken up into three parts, generally speaking: (1) Identifying the goals and creating a plan to achieve them, (2) executing the financial tasks to work toward that goal and lastly, but perhaps most importantly, (3) serving as a coach/guide/sounding board when life's questions come up or unforeseen events shake the client's confidence in the plan and the execution of it.
It's number three on this list that can be a catalyst for marketing. It isn't about sending a message or email to your client that says "Hey, the markets are down 18% but good news - you're only down 7%!" An approach like that quickly reduces the adviser value to what he or she does with a client's portfolio. Rather, a conversation or touch point that might go something like, "Hi Tracy, I know you were talking about selling some of your holdings to pay for your daughter's wedding this spring. We're all watching the market volatility and I think there's a different approach we should consider..." or "Hey Jim, I remember our last chat about you putting in for retirement this summer. I checked in on your situation and it looks like you can keep that timing if we adjust one or two things."
Zeroing in on the personal side of the client relationship during the difficult times makes you all the more referable. There's inevitably a friend, a family member or colleague of your client that isn't getting the help they need. Your firm can step into that void simply by making a great client experience the leading edge of your marketing effort.
Now, on the proactive marketing side, RIA firms need to identify strategies to project their thought leadership, their credibility and how attune they are to their clients' financial life goals. Take a look at a recent video post on United Capital's Twitter feed. Kara Murphy, the firm's chief investment officer, addresses the market conditions from an empathetic and thoughtful perspective. The aim here was to assure their clients that they are paying attention and to inject some perspective to avoid fearful overreactions.
Mariann Montagne, portfolio manager at Gradient Investments, took to CNBC's airwaves to inject her own voice of reason. In this instance, instead of laying low, the proactive "we're on top of it" approach can make all the difference in the world for uneasy investors. Not to mention, for many seeing their adviser on TV is enough to get them talking positively!
Here at Gregory FCA, we've been working with wealth management industry firms for close to 20 years. During that time, we've seen robust markets and total busts. In every environment, there are firms that win and firms that lose. It's our job to help our clients take advantage of the opportunities that can present themselves with disruption.
Don't hesitate to reach out to our team if you'd like to do more to improve your marketing communications, cultivate your media profile and turn today's turmoil into tomorrow's launch pad.
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