The nuance of communication and relationships has a major impact on referrals and how people choose their financial advisors. And now, MIT's AgeLab has published research that analyzes a four-year time frame (before and after the crisis) to address these nuances and, even more important, illustrate how they have changed.
Research unveiled by John Diehl, senior vice president at The Hartford, at the Raymond James Financial Institutions Division Management Symposium suggests that the use of specific words has lessons for all FAs. (The director of MIT's AgeLab is Joseph Coughlin, a frequent contributor to Bank Investment Consultant.) MIT researchers scoured the Internet for discussions among people regarding advisors. These peer-to-peer discussions were deemed more relevant than focus groups or surveys, Diehl said in the session entitled "In The Company of Strangers."
One change in that time was the perception of the word "investments." The view essentially went from negative to positive in that time frame. The takeaway, Diehl said, was that FAs who base their value proposition on their ability to manage investments are on the wrong path. Clients expect advisors to be competent in investment management but "expert in me," Diehl said.
Being an expert in them entails, among other things, knowing what comes next in their lives, he said. One finding from MIT in this area is that caring for an elderly parent, or in-law, is a major concern of women age 47 to 57. "When bringing on new customers, how many (advisors) talk about health and location of parents?" he asked rhetorically.