On any given day, in the media or at any industry conference /gathering, it’s a fairly good bet that technology (AI anyone?) will be figuring prominently.  And yes, the ever-evolving world of tech is vitally important to allow businesses to operate efficiently and profitably. However, with all the noise around tech it’s important not to forget what the business of advice is all about – helping people

However, it seems to us that in recent times, the customary focus on Client Relationships is in danger of being relegated to the back burner as practices strive to balance their business priorities. We see fewer practices seeking client feedback (26% of firms actively seek feedback, down from 32% a few years ago) while communication touch points have further reduced in terms of frequency and relevance. (Future Ready IX Report: Insights into the Australian Advisory Profession, Jan 2022)

5 ways to cultivating client relationships

1.The personal stuff. While practices collect and retain all the standard hygiene policy and product information, less than 10% keep a record of key relationship building data such as wedding anniversaries, children’s and grandchildren’s birthdays, charitable and community interests, sporting preferences and favourite teams on their core client management system. Sounds ‘corny’ perhaps but it isn’t to the client. Needless to say, once collected, this data should be updated regularly. Out of date info is very often more damaging to a relationship than no info.

2.Engaging communication. Countless studies have proven over the years that clients value proactive, relevant and personalised communications. And yet, only 27% of firms report that they contact their best clients ten or more times per year. This is down from the 33% recorded in 2019. (Future Ready IX Report: Insights into the Australian Advisory Profession, Jan 2022)

Variety in the ‘how’ can be important too. Clients value a proactive “reach out” and “how are you going” call, especially in times of uncertainty and challenge.

3. Feedback. A quiet client isn’t necessarily a happy client. While too few practices actively seek their clients’ feedback, those who do make the effort are invariably rewarded with insightful comments and suggestions. Note the average response rate to our CATScan survey is around 35% – clients are happy to provide their feedback. They just have to be asked! (Business Health Pty Ltd, CATScan client survey database, 2024.)

 As the adage goes – clients don’t care how much you know, until they know how much you care.

4. Range of services. Know your client, their times are changing. It’s important for the practice to not only recognise that these changes are in play, but to adapt their offer/range of services accordingly. Unfortunately, over the past few years we’ve noted a decline in client satisfaction with the ‘Range of Services’ offered by their adviser. (Business Health Pty Ltd, CATScan client survey database, 2024.)

5. The review/progress to plan meeting. In our view the review process is the adviser’s ‘moment of truth’ to prove their value. It’s also a catalyst for bringing the previously mentioned four points to the fore.

Finally, supportive of a renewed focus on Relationship, we noted with interest that in the recently released 2024 Kitces Report ‘How Financial Planners Actually Market Their Services’ that there had been a greater use of in-person marketing tactics by US advisers this year – no doubt reinforcing the value of relationship marketing.

Technology can help but it won’t replace the need for cultivated relationships.

Terry Bell

Partner, Business Health Pty Ltd.