Becoming a trusted advisor for high net-worth (HNW) clients requires more than just financial expertise. Well-developed soft skills are critical to building trust and nurturing relationships in this market, as is providing superior service.
“Performance is very important. But more than that, the full service [is what] advisors are forgetting about,” says Sadiq Adatia, chief investment officer with Sun Life Global Investments (Canada) Inc. in Toronto. “How successful a relationship [will be] really depends on making sure that you’re accessible to your clients, that you have all the right services that they would need and that you are being proactive and touching base with them.”
First and foremost, building strong relationships with your HNW clients requires trust. For example, Mark Therriault, a financial advisor and certified financial planner with Nicola Wealth Management Ltd. in Vancouver, works with clients who are business owners and HNW professionals. For Therriault, earning his clients’ trust means understanding much more about them than their financial goals and risk tolerance.
“I tend to have relationships with my clients beyond their financial picture,” he says. “I really want to try to understand what’s important to them financially, but also, for example, the things that keep them up at night or understanding their family dynamics – their children.”
At the beginning of every meeting with a client, Therriault typically spends 20 to 30 minutes catching up with the client and finding out what’s new in his or her life before delving into financial matters.
Taking this approach is key to making your clients feel comfortable about sharing all aspects of their finances, an important prerequisite to providing effective advice, says Adatia. He notes that many HNW clients have assets spread throughout a variety of businesses, trusts and accounts. Getting a full overview of all assets is crucial.
“With only half the information, you’re going to be able to do only so much,” says Adatia. “If you have the full picture, you can do a lot more for any client.”
Staying in regular contact with your clients is vital to your relationships. That means responding to clients’ phone calls and emails within 24 hours and getting in touch with them proactively during periods of market volatility or other events that may trigger clients’ concerns.
How that contact is made is important. Although emails and newsletters can provide a convenient method for communication, meeting your clients face to face should be the top priority, says Jordan Rosenberg, manager of business development with MacNicol & Associates Asset Management Inc. in Toronto: “Clients want to feel that personal touch. It’s still about that face-to-face relationship.”
As HNW clients typically have comprehensive financial needs, meeting with them at least twice a year is important. In some cases, sitting down with these clients as often as once a month may be necessary.
Rosenberg recommends implementing a routine of meeting with your clients four times per 18-month period. Offer a different focus for each meeting, such as investments, estate planning, insurance, and a final meeting during which the client can give feedback and raise other concerns.
Having reliable staff members is critical to providing an appropriate level of service to your HNW clients, Rosenberg says. Although many advisors are reluctant to spend money to hire staff, he says, it’s a necessary investment.
“I’ve never met an advisor team that is overstaffed, but I’ve met hundreds that are understaffed,” Rosenberg says. “You just can’t do it on your own or with limited staff. If you want to grow your book and add new clients, you need to invest in it.”
Showing appreciation is another important component of maintaining strong relationships with your HNW clients. But how do you show appreciation to a client who has it all? Many advisors struggle to come up with the appropriate gestures to make their clients feel special.
Although gift giving was popular in the past, advisors should be cautious about trying to impress clients with lavish presents, Rosenberg says: “Gifts can be perceived negatively.” Thus, it’s better to differentiate yourself with good service or expertise, he notes, rather than objects.
However, Therriault says, he occasionally sends clients a bottle of wine or a restaurant gift card to mark a milestone, such as reaching a certain level of assets. “It lets them know that we’re paying attention,” he says.
In general, however, Therriault prefers to show appreciation by providing clients with opportunities to attend exclusive events and learn from distinguished experts. “We try and add value to [our clients’] situations,” he says.
Recent client events hosted by Nicola included high-profile speakers such as Craig Kielburger, co-founder of Toronto-based charity WE, and businessman and philanthropist Frank Giustra. Nicola also invites clients to attend annual galas in support of Imagine1Day International Organization, hosted at the Vancouver home of its co-founder, former Lululemon Athletica Inc. owner and philanthropist Chip Wilson.
Events that revolve around charitable giving tend to resonate with HNW clients, Rosenberg says. For example, he says, one advisor hosts an annual event in which he asks clients for ideas on how to spend $1,000 to make a positive impact in their community. The advisor chooses 10 clients, who are provided with the funds to implement their ideas. Clients then gather at an event during which they vote on the initiative that should receive an additional $2,500.
“Clients really appreciate that [program],” Rosenberg says.
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