Financial advisors in client consulting: better assessing and communicating customer expectations

“In recent years, many people jumped head first into things like user experience, customer experience or the Amazon principle”, Said mentioned. “We must, however, never lose sight of what customers are most interested in: achieving their financial goals.” User experience in the advisory environment is expected to be good, but when customers do not reach their financial goals in the end, dissatisfaction with the advisor will be high after all. The study shows that there are frequently different priorities of advisor and client.

Clients rate skills and knowledge, good communication and good reputation/positive reviews as an advisor’s most valuable attributes. “This is probably something that many financial advisors would not have expected”, Said highlighted. “Too often in the past, an advisor’s value was measured only by the performance they achieved for their client.” It is becoming ever more apparent, however, that, in addition to mere performance, advisors with comprehensive knowledge are particularly highly valued. “Advisors will be able to score points with sound skills, especially in complex situations like the pandemic”, Said added.

It is interesting that some elements of their work that advisors take for granted are valued much more highly by clients, and should therefore be emphasised more in communication. “The topic of taxes is first and foremost among them”, explained Said. “Advisors will regularly include the tax consequences of investments in their planning. While clients value this service very highly, advisors rarely think it’s high on investors’ minds.” Even though this topic in particular is reserved for specialised professional groups, advisors can use it to their advantage if they demonstrate to their clients that they have the tax consequences in mind and are offering a competent network when it comes to details.

Conversely, advisors consider controlling client emotions to be an essential part of their job, while clients consider this to be a negligible factor. “Some educational effort is needed here – and advisors should tackle this courageously”, recommended Said. If clients do not see controlling their own emotions as crucial, it is up to advisors to change this perception. “Financial science shows that a key part of investment success comes not from selecting the right products or from skilful timing, but from the ability to follow through on a strategy that has been identified as correct.”

In times of crises, this has already been proven time and again – most recently in the major downturn in the face of the pandemic: portfolios of advisory clients recorded better performance than those of unadvised clients. According to Said, “sometimes it’s all about addressing fears and convincing clients that the decision they have made is the right one”. Then clients are better able to sustain phases of loss. “Long-term and prudent action instead of timing is the key success factor that advisors will only achieve with their clients through intensive communication.”

Good communication is shown above all by the ability to present complex issues in simple terms. The objective is therefore to centre on the actual performance of the advisory service and to put the achievement of the clients’ long-term financial goals above maximising returns in the short term. “The topic of reputation or positive reviews, which is also highly valued by clients, is probably not yet many advisors’ radar”, Said pointed out. “This is where the Amazon principle comes into play yet again, according to which clients like to be guided by rankings.” Ideally advisors should work on their web presence, as the internet is already the number one research tool for many age groups.

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