It may be less than you think, but you can build that trust and earn more assets by understanding their emotions.
There’s a clear relationship between how much clients trust their financial advisors and how much money they’re willing to give them to manage. If you can increase trust, you’re much more likely to grow wallet share with your clients.
But how can advisors build trust? First, it’s important to recognize that trust exists on a spectrum. While some clients are very skeptical of financial advisors, others are inherently trusting.
Second, and more important, is that a client’s level of trust is driven by their emotions, beliefs and past experiences. To effectively build trust, advisors need to understand each client’s emotional makeup.
FlexShares’ new behavioral research looked into the factors that drive clients’ wallet-share decisions. We found that clients can be sorted into five distinct personas, each with a different level of trust based on that persona’s characteristics. By understanding these personas, advisors can develop the right techniques to build stronger, more trusting relationships.
Our research found that clients fall into one of five personas: Protectors, Competitors, Collectors, Verifiers and Simplifiers. Besides encompassing different traits, these personas also occupy different places on the trust spectrum:
Understanding the traits and characteristics that affect trust for each persona helps you adjust how you work with them. Consider these approaches:
As you can see, each persona requires a slightly different approach to address their needs. But as you solve their biggest problems and address their emotional makeup, you’re building a level of trust that can lead to gaining a greater share of their wallets. Read our new white paper to learn more about each persona. Then contact FlexShares to learn additional strategies that can help you build stronger relationships.