Boost Client Buy-In With More Effective Communication

Effective communication is essential for getting clients to embrace a financial plan or investment recommendation and can materially impact the success of your practice.

The more convincing and compelling your messaging, the more likely your client will see the value you bring. In a survey by the investment research platform YCharts, 85% of clients said they would consider a financial professional’s frequency and style of communications when deciding whether to retain his or her services.¹ Communications also directly impact the client’s confidence in a financial plan and their willingness to refer their financial professional to family and friends. 

Proactive, personalized communications can also lead to higher levels of client satisfaction, particularly in volatile markets:

• A Dalbar study found that investors who received proactive communications from their financial professionals reported higher satisfaction scores than those who did not.²
• The YCharts survey found that 75% of clients want personalized updates, such as news articles, statistics, or visuals that are relevant to their portfolios.¹
• More than half of clients (51.3%) in a recent survey from the fintech firm SmartAsset said the most common reason they reach out to their financial professional is market volatility.³

At T. Rowe Price, a key pillar of our investment approach is coaching our investment professionals on their communication skills so they can be persuasive when pitching ideas to portfolio managers. The goal is to ensure that the most compelling recommendations make it into fund portfolios. We’ve developed best practices for all of our investment-related communications, including stock upgrade reports and new stock pitches. We also offer guidance on how to convey unwelcome news and prepare for meetings with management teams. 

These best practices can be applied to your client meetings and communications that cover new investment opportunities, portfolio updates, and market perspectives. Here are a few examples of situations that might benefit from our guidance:

• Sharing an investment idea with a client, perhaps after a rollover from their retirement plan
• Influencing an investment committee on modifications to a plan lineup
• Recommending an addition to a model portfolio

There’s an art to making a compelling investment pitch. Here are a few ways to drive home your message:

• Make your case succinctly and summarize the key points behind the recommendation at the beginning of a written document or start of the conversation. 
  • Be direct. 
  • Make headlines count. An assertive headline, such as “Three reasons to own the stock,” shows conviction in your recommendation.
• Drive home the investment thesis in brief, data-rich, boldfaced bullet points based on sound analysis and offer value-added insights. 
  • Context is key. Make sure all data points include relevant comparisons so clients know what the numbers mean.
• Back up your recommendations with supporting analyses that feature the top three to five reasons behind the recommendation. 

Markets don’t always go up, and not all stock or investment recommendations pan out, so it’s crucial that you convey bad news to your clients when you feel it’s appropriate.

• Explain to your client what happened clearly and directly.
• Elaborate on what the unwelcome news means for your client’s financial plan.
• Let your client know what steps, if any, are necessary to protect their portfolios or holdings from fallout.

It’s easy for meetings to get off track, which is why agendas are so important. Here are some other ways to make the best use of everyone’s time:

• Focus on three or four important things you want to address.
• Create a meeting outline for yourself and coworkers that identifies the reason for the meeting, key issues the client is concerned about, and what you want to accomplish.
• At the meeting, follow these best practices:
  • Come prepared.
  • Make introductions.
  • Stay focused on key agenda items.
  • Finish on time.
  • Make sure all client issues are addressed.
  • Recap next steps at the end of the meeting.
• After the meeting, follow up with the client to review steps you are taking to address any concerns they may have and inquire about how you can better serve them going forward.

How you communicate with your clients can make a big impact on the success of your practice. A good idea on its own doesn’t matter if you don’t get agreement on it. Sharpening your communication skills and coaching junior team members can go a long way toward solidifying existing client relationships and laying the groundwork for new ones.