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Five Steps to Effective Client Communication in Difficult Times

Issue 8 - July / August 2009

Develop a master communications plan that lays out how often and what you will communicate to clients—in both good times and bad.

In today’s volatile markets, you may find yourself avoiding difficult client conversations. After all, it is never pleasant dealing with clients whose portfolios may have precipitously declined in value. However, investors continue to cite frequent communication as one of the key attributes they prize most in an investment professional, particularly during unsettled times. In fact, by continuing to reach out, you will go a long way toward strengthening your relationships—and maybe even uncover new opportunities to expand them.

Five Steps for Effective Client Communications

  1. Contact all of your clients. Your first reaction might be to approach only your top clients. However, in a tough environment, all of your clients need reassurance and the comfort that comes from knowing you are on their side. If you work on a team, you might divide your “a,” “b” and “c” clients among team members to maximize your client retention efforts. You may even consider calling your top clients and sending others a letter suggesting they contact you to set up an appointment for a client review. Regardless of how or to whom, be sure to respond promptly, in other words, within two to four business days, to each reply.
  2. Tailor your communication to the client. Not everyone likes to receive information in the same way: one client may prefer a phone call, while another prefers e-mail. Be sure to use the method that the individual chooses. In addition, prepare for your conversation by reviewing the complete client relationship, including their stated financial goals, concerns, time horizon, risk profile and more.
  3. Increase the frequency of your contacts. Evaluate the average number of times each year you communicate or interact with your clients. This includes phone calls, e-mails, events and face-to- face meetings. Whatever the answer, take that number and make the effort to significantly increase it. Develop a master communications plan that lays out how often and what you will communicate to clients—in both good times and bad.
  4. Use your own words. Clients crave authenticity and sincerity from their investment professionals. For that reason, when sending communications, it is important to include your own original content rather than leveraging existing content from industry websites or publications. It may take a little longer to write, but express yourself using your own words and style.
  5. Prepare to receive criticism. Given current market conditions, it is likely that some clients will be upset, even angry, when you contact them. As a result, it is best to anticipate their reaction and plan ahead as to how you will respond. For client conversations and meetings, you may wish to address any bad news early on, allowing the client to express their views without interrupting.

Remember: Your clients need to know that you are willing to listen, calmly discuss their concerns and provide solutions for the future. By allowing them to talk, you will form a bond that is likely to outlast any market downturn and put you—and keep you—in good stead when the economy improves.

For Professional Use Only.

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