The Path to Discovery

To keep current clients and attract new ones, conduct Discovery Meetings.

By John Bowen, founder and CEO of CEG Worldwide

Keeping your clients loyal and attracting new ones can be challenging in any environment. But in the current market, it’s an especially nerve-racking proposition for many advisors. Fortunately, there are a number of steps you can take right now to retain your existing clients and gain plenty of new ones too.

Keeping your clients loyal and attracting new ones can be challenging in any environment. But in the current market, it’s an especially nerve-racking proposition for many advisors. Fortunately, there are a number of steps you can take right now to retain your existing clients and gain plenty of new ones too.

One of the most powerful tools for making that happen is the discovery meeting—a process for accurately uncovering a client’s or prospect’s full range of needs, concerns and values, in order to build a comprehensive plan. Conducting discovery meetings is something you should do regardless of the state of the financial world. But right now, they can be vital to keeping your business healthy.

Why Now?

One reason: The recent economic and market turmoil may have caused some of your clients to rethink their goals, their needs and their values in life. There’s a good chance that you don’t fully understand some of your clients’ entire financial situations as they look today, even if you knew them well in the past. Without such knowledge, you can’t do a great job for your clients.

Conversely, many clients’ goals and needs have not changed at all despite the intense volatility. By reviewing their situations in the context of a discovery meeting, these clients will come to see that nothing fundamentally new or different has occurred in their lives —they’re still the same people with the same values, needs and goals. That insight can calm the most nervous of investors and stop them from making rash decisions that hurt their own financial well-being (and your revenue stream).

In short, a great discovery meeting helps investors identify what they truly care about and tells them that you would like to help oversee their entire financial lives, not just put together an investment portfolio. These meetings are providing powerful benefits to some of the top advisors that we coach. Near the end of last year, for example, one advisor was confronted by an important client who was prepared to fire him. The advisor made a deal with the client to go through a discovery meeting to discuss the client’s concerns. If the client still wanted to fire him after that, he was free to do so. In the end, the client chose to stick with his advisor.

Discovery meetings are also helpful for converting prospects into clients. In my last column, I pointed out that in one survey, 81% of clients said they intend to switch advisors. When you get in front of these investors and conduct an interview that helps them identify what is most important in their lives, you differentiate yourself from all the advisors out there who make recommendations based on cursory reviews of their clients’ situations. One advisor we work with recently won a multimillion-dollar account largely on the strength of his initial discovery interview with an affluent client.

The Right Profile

To generate such results, your discovery interviews must allow you to fully understand clients’ and prospects’ lives. That means going far beyond asset management or estate planning issues, into the realm of their most important values, relationships and lifelong dreams.

Nearly all financial advisors use some type of fact-finding process when meeting with clients or prospects. But their questions usually focus on assets and net worth, doing little to uncover who the clients really are on a deeper level. In contrast, a great discovery meeting addresses numerous categories to ensure that you delve into all key areas.

Your job during each discovery meeting is to create a comprehensive client profile. To do that, ask the prospect or client a series of thought-provoking questions in each of seven categories (goals, relationships, assets, advisors, process, interests and values) and write down the answers. It’s important to remember that this isn’t the time for you to talk about how great you are or your perspective on current events; it’s a chance to listen to the person sitting across from you, so that you can do address his or her greatest needs.

  • Goals. Effective goal-related questions you may ask clients are: What do they want to do for their children, parents or the world at large? What do they want to achieve with their money? What are their top accomplishments-and what would they like them to be?
  • Relationships. These questions should identify which relationships are most important to clients-from family members to co-workers to people in their communities and religious circles.
  • Assets. Questions about assets should cover basics like sources of income, how clients save and invest and their investment holdings and tax situation-as well as how these basics might change in the coming years.
  • Advisors. These questions should get clients talking about other financial services professionals they work with—lawyers, life insurance agents, other advisors or planners —and how they feel about those relationships. This information can give you a fuller picture of their finances and help you uncover opportunities to gather additional assets.
  • Process. Process questions should identify how active a role clients like to take in managing their wealth and how they prefer to be contacted by advisors.
  • Interests. Interests might range from hobbies and weekend pursuits to favorite causes and charities.
The Value of Values

The most important of the seven categories is values. In fact, a values-focused conversation is one of the most important talks you can have with prospects or clients. Values are one of the core motivations for everything we do in our lives. They have a profound impact on every important decision we make, from what we choose to do for a living to whom we marry to how we spend our free time —in short, who we are as people.

For example, most parents would tell you that they value their children above almost everything else in the world. Financially, one of the things many of these parents want to do is build a college fund for their children’s education. The reason why they want to do that, the primary motivator underlying that goal, is a fundamental value-love for their children.

As important as values are, most people have a difficult time articulating them. Most of us act definitively on our values, but we haven’t thought deeply about exactly what those values are. So when you ask your clients to identify their core values, you not only uncover exactly where your focus should be in assisting those clients, you also help them to clarify their overall direction and what they want to achieve in life. This can help create a powerful advisor-client bond, as you’re helping them think through some of the most important issues they face.

Starting a values-based discussion is relatively easy. Simply ask what is important to the client or prospect about money. Let’s say the answer is security. You’d then ask what is important to him or her about security. If the client responds, "Knowing that I can take care of my family," you follow up with, "What is important to you about taking care of your family?" Keep going with this line of questioning until you think you have heard the final answer. Then ask if there is anything more important to the person than the last value he or she mentioned. If the client says "Yes," then ask, what it is and keep going. Once the client answers "No," you will have likely uncovered his or her single most important value.

You might need some perseverance to get to this point, however. Values are not something that most people have ever discussed with their advisors, and it can take a while to hone in on what really matters. Start off by getting them to talk about basic issues like security and financial freedom. Then drill down to their values and feelings about others —including family, friends and community. Finally, encourage them to explore issues of higher self. You can encourage your client to go deeper by simply saying, "I think we might not be done." You will usually know that the conversation is nearly over when they move into abstract or even esoteric territory (including their faith, what they see as their destiny and their deeper reasons for being).

Your goal is to reach a point where the person is talking about something that deeply inspires him or her. Once there, you will have something of tremendous value —a comprehensive map of the person sitting across from you that you can use to design a wealth management plan that addresses every key aspect of his or her life.

Your ability to add value in this way sets you apart in any environment. Given the uncertain state of the world today, it gives you an even bigger competitive advantage —one that can help you vault over your competitors and emerge from the current downturn in better shape than ever before.

Source: CEG Worldwide.

Reprinted from: Financial Planning

About the Author

CEG Worldwide’s founder and CEO, John Bowen has long been known as a leader in the area of adding value to financial services firms. Bowen started his career as an independent broker-dealer representative and then became a fee-based financial advisor. He was ultimately named the CEO of Reinhardt Werba Bowen (RWB), a money management firm that helped other financial advisors raise billions of dollars in assets. In 1998, Bowen became CEO of Assante Capital Management upon the acquisition of RWB by Assante. He left Assante to start CEG Worldwide in 2001, in order to help advisors realize substantial success through the use of CEG Worldwide’s business development systems.

He is the author of many books, including Breaking Through: Building a World-Class Wealth Management Business and The Prudent Investor’s Guide to Beating the Market.