The volatility that the market brought this past summer has everybody a bit nervous. Whether it's the pit in my stomach while reviewing my 401(k) and profit-sharing accounts or my brokers' non-stop ringing phone lines; the feelings are the same.
If the market doesn't sleep, neither do those that have a vested interest. My team took some time out to see what the pros are telling and doing for their 'Nervous Nellie' clientele. From managers to million dollar producers, we scoured Wall Street to Main Street to be told repeatedly that constant communication and perspective can help see your clients through the difficult times and into the good.
You and your sales assistant are the front line communicators to your clientele, but when times gets tough it could be time to call in the big guns. You know, you aren't in this alone. Chances are your manager and your company itself reaches out to larger clients on a regular basis.
A friend of mine who is a branch manager near Philadelphia suggests that you "communicate with your clients and have your company do so also." His wirehouse went above and beyond to contact their clients during the August downturn.
The firm not only had daily conference calls to its advisors, but the clients as well. The communications helped to calm the clients down a bit and made them almost feel like they were part of the investment team. After all, the manager said, the clients had some of the smartest minds in the business telling them their thoughts.
On the flip side, with so much downside going on with people's investment portfolios, make sure you don't have to keep apologizing for your company. I recently got a call from a $3 million producer. His team has been at the same wirehouse for most of their careers. One of his largest clients had called him over the weekend. Between the mix-ups in his multi-million-dollar accounts and just the lack of overall vision and repeated bad news about his employer, this producer decided he finally had enough.
I have to agree with him. In the end, it's his clients and the shareholders that bare the brunt of everybody else's mistakes. "I used to be the poster boy for this company," this producer told me. "If there was ever a company event, I was the one that was up there speaking on the stage about how wonderful this place is. I can only justify how poorly things are going on for so long."
Another manager, (who I will call Terry), claims information was the key and if the advisors don't follow up by supplying their clients with the necessary items they need to know, the result is: defecting clients. Terry's firm made great use of information for clients. He told me that: "Our chief strategists held several live calls that clients could dial into. And we had the replays available afterwards. We got a lot of mileage out of that. We also had a ton of items available for FA use and many white papers and strategist commentary day-to-day, sometimes multiple times during the day. Our pre-market, mid-day and after-market firm strategy calls with our advisory services group focused most, if not all, of their discussions on the current state of the market and how to address volatility with their clients. It could seem like information overload. But all the tools were made available for us to use."
As far as using your manager's expertise to help out, Terry told me: "This is one area where I feel that my value proposition really holds true as a manager. I am not a producing manager, and that is very much by choice. Management today isn't just about revenue like it was years ago. It's a whole lot of leadership, guidance and in many ways, we do the same hand-holding of our financial advisors that our advisors do with their clients. With me being solely dedicated to the financial advisors in my complex, it allows me to be available for them to help them do what they need to do, day-to-day." For Terry, it means removing something from an advisor's plate so he or she can work with clients, generate revenue and deepen relationships.
During volatile times, Terry sees himself as "the information maven and the connector." And in calmer times, he is a source of leadership and guidance. Currently, he spends a couple of hours each day now dealing with office clients.
The common theme among successful brokers is making sure they not only pick up the phone (don't hide!) but that they put the issues of the day, week or month into perspective for their clients.
Contact with clients is critical. Don't wait for them to call you. Stay on top and call them. Arrange a face-to-face meeting to go over what they are currently invested in and remind them at the meeting why are invested in it in the first place.
One thing that I'm guilty of—when times are good—I don't always engage in the quarterly meetings that I probably should. Clients' needs change all the time; mine included.
As a financial advisor you should be fully aware of client's financial picture and any modifications that have happened. This way, there can be a seamless transition into a new product or strategy that may be more suitable for today and not three years ago.
Ultimately with so much turmoil going around, remember that both your firm and manager must be there to help you with clients. Be sure to utilize all the tools that your investment strategists give you. If you don't have the time, have your sales assistant call the clients to let them know when the conference calls are and schedule a time for a debriefing.
Be calm and be the voice of reason. If you find you are the only one out there that's guiding your clients' ships, maybe it's time to find another firm that will help you navigate through Wall Street and Washington's 'perfect storm'.
Carri Degenhardt-Burke runs Degenhardt Consulting in Jersey City, N.J.
For further information, call 201-395-0222 or, go online at www.degenhardtconsulting.com.