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You have wanted to penetrate the HNW circles in your local community for some time. Your perseverance has paid off. You are now inside, getting invited to exclusive parties, attending charity galas and invited to join private clubs. I’'s tempting to pull up the drawbridge and focus exclusively on cultivating your newfound friends. Curiously, they are all older than you. You need to make time to add young people to your social circle, even if they don’t all have the potential to be clients.
Ten Reasons Why You Want Younger Friends
This strategy isn’t exclusively my own idea. I’ve seen HNW individuals employ the same strategy with great success. Here’s the logic behind why they, I and you should cultivate the younger generation:
1. You learn about their buying habits. This was a primary reason a property developer we know got to know younger people socially. Where do they spend their money? What types of stores do they frequent? He built outdoor shopping malls and learned the types of stores that will (or won’t) attract younger shoppers to his locations.
2. You learn how they choose to communicate. We all reach a comfort level with technology. I relied on the phone when I was an advisor, gradually adding e-mail and LinkedIn over the years. Many younger people ignore phones completely. E-mail too. They may prefer different social media channels. If you want to attract potential clients, you need to know how and where to get their attention.
3. You are reintroduced to entertainment. There’s a reason why our local supermarket chooses songs from the 70’s and 80’s as their background music. Their primary audience relates to those tunes! If you see TV ads for the Grammys or Country Music Awards, you might think “I don’t know these artists.” Having a circle of younger friends keeps you current on starts in the music world.
4. You learn where they get their information. You have heard many people use their Smartphone has their primary portal to the world. They aren’t watching the 6:00 PM news on TV or reading the print version of the newspaper. Publications like the New York Times have had great success in penetrating the digital world with a hybrid model of free and paid access to online content. You learn how to reach your audience.
5. Young people without money may have parents with money. Your friends might be the conduit to people who really need advice but would not reach out of take your call without an introduction. If your friend is really impressed by your knowledge, they may provide a great endorsement: “Mom and dad, you really need to talk with this guy. He knows what he is talking about.”
6. You learn what they value. It has been generalized younger people don’t cook or entertain at home. Some homes are being designed without dining rooms. That’s interesting to know but probably won’t lead to business. They may have an interest in sustainable investing and the future of AI. You may learn what gets their attention.
7. You learn how they make decisions. The Economist recently ran both an editorial and an article about the role of social media influencers and the effect on traditional advertising. Influencers matter more to younger consumers than traditional ad campaigns. You already know they prefer evaluations from users of the product, not advertising. User generated content fills sites like Trip Advisor. You also know people or firms have tried to “game the system” which requires constant vigilance on the part of these sites. Bottom line, they respect referrals.
8. You learn their attitude towards money. If you are a Baby Boomer, you have parents or grandparents with memories of The Great Depression. This hard wired their attitudes. They never seem to throw anything away! Their refrigerators have lots of leftovers. People who grew up in the past 20 or 30 years have largely lived in a time of abundance. I was amazed to learn about the concept of “fashion furniture.” You buy furniture, use it for under five years, then toss it out and redecorate. You repeat the process over and over They often feel money will always be available when then need it.
9. Social responsibility. They place a high value on doing the right thing. Although “fashion furniture” exists, they often feel we shouldn’t live in a disposable society. We should preserve the planet and the environment for our children. This can influence their investing preferences.
10. Lots of stuff should be free. Younger people often feel “If it’s available for free on the Internet, it should be free everywhere else too.” This becomes an issue when paying for investment advice. They may not realize “free advice is biased advice.” They may not understand “free shipping” isn’t really free, it is calculated into the cost of the product.
There might be a temptation to say, “You need to think the way I think.” It’s important to understand their values. It allows to put yourself in their shoes, understand them better and speak their language. You can start to swing them over to your way of thinking once you get some buy in.
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