One of the most puzzling things that can happen to a financial adviser happens during the first appointment when the adviser seems to be building rapport, then suddenly the conversation takes a turn and there’s an awkward disconnect.
James T., a veteran financial adviser client of mine with 10 years of experience, explained that he was recently in a meeting with a prospect who was in a high tax bracket and he had a large sum of money to invest but didn’t want to pay taxes on the money as it grew.
James felt that he knew just the right investment vehicle to recommend and said, “It sounds like to me you need a variable annuity.” Unfortunately, what James did not know is that the prospect had a disdain for annuities, didn’t fully understand them and felt that the internal fees were way too expensive. As a result, the prospect responded, “No I don’t.” After that it was quite apparent that he didn’t want to hear anything else that James had to say.
Understanding the Reconnection Strategy
Oftentimes, advisers can say something that may cause a prospect to disengage. When this happens, most advisers try and stress their point or find another way to reconnect. Unfortunately, neither are effective. I suggest to my clients to use what I call the Adviser Solution Reconnection Strategy.
The following is an example of the Reconnection Strategy:
1.) Disconnect: When an adviser asks a question or makes a statement that creates resistance in the prospect, it creates a disconnection in any rapport. The challenge is that it’s virtually impossible to know what any prospect may feel about a product or service.
Adviser: “One of the things that I do for my clients is to make sure they have the right life insurance coverage so that we minimize financial risk to the family should anything happen. Can you see why that is important?”
Prospect: “We don’t need more life insurance, we’ve got enough coverage to pay for the burial expenses.”
2.) Explain: When the adviser realizes that something has gone awry, it is important to explain why he/she asked the question or made the statement that they did in the first place so that the prospect can understand the adviser’s rationale.
Adviser: “The reason I ask that question is because burial expenses are sadly just the beginning of the expenses, not the end.”
3.) Story: Telling a story helps to take the pressure off the prospect seeming wrong or having to defend their position.
Adviser: “It reminds me of a client I had who said he just wanted enough to cover the cost of the burial. Unfortunately, that’s all he got and later that year he had a heart attack and passed away. After about a year his wife had to downsize because she couldn’t pay the mortgage on her own. They moved and the kids went to a new school.”
4.) Reconnect: Once the story is shared, it is vital to ask if the prospect can relate to the story.
Adviser: “Can you see how that affected the family?”
Prospect: “Yes, I see how that impacted them.”
Adviser: “How would it financially impact your wife and kids if something similar occurred?”
Prospect: “They would probably have to do the same thing. I guess we should consider taking a look at some more life insurance.”
Why the Reconnection Strategy Works
The reason why the Reconnection Strategy works is because it’s not about the adviser defending their position but rather about explaining the challenges others have faced in scenarios that may be commonplace. By helping the prospect realize that at some point down the road they too may have that same challenge, the reconnection is made as the prospect now understands the adviser has the expertise and knowledge of situations that take place that should be safeguarded ahead of time.
If this blog resonates with you and you would like to have a free consultation with me to see if professional coaching is a fit for you, email Melissa Denham, Advisor Solutions’ director of client servicing at firstname.lastname@example.org.
Daniel C. Finley is the president and co-founder of Advisor Solutions, a business consulting and coaching service dedicated to helping advisers build a better business.