The Importance of Generational Listening

CoyneJohn E. Coyne, III, Vice Chairman, Brinker Capital

I had the opportunity to speak on a panel at the Nexus Global Youth Summit in New York City last week. More importantly, I had the chance to listen to and speak with a number of those in attendance.

Nexus is a global movement founded in 2011 whose network consists of over 1,000 young philanthropists, social entrepreneurs and influencers. Their unified goal is to increase and improve philanthropy and the social impact of investing. They come from more than 60 countries and represent more than $100 billion in assets. They have the commitment, intelligence, passion and clout to act on it.

I was in awe of the debate and discussion I witnessed among these ambitious, young leaders.  What they shared, how they felt, how they deviated from each other in plan but matched in vigor and passion—it was among the most intelligent discourses I have listened to in some time. The mindset of the social entrepreneurs in attendance turned the ways I have defined this area upside down.

If financial advisors, family offices and wealth managers wish to remain relevant, it is incumbent on us to help facilitate the dialogue within and across generations, understanding that if properly equipped, this rising generation will accomplish things on an unprecedented global scale. And if we, the Baby Boomers and Gen Xers of the world, don’t adapt to the methods of investing and communicating they are evolving towards, we will be left in the dust.

I want to thank Logan Morris at Snowden Capital for including me and congratulate Rachel Cohen Gerrol on this incredible event. I must give a particular shout out to the woman who spoke from Kopali Organic chocolates.  They are delicious, and you have made a convert.

7.30.13_Coyne_NexusSummitFor a more in-depth look into this year’s  Global Youth Summit, please read this event summary published by Forbes, or take a page out of the Generation Y book and check out their Facebook page.

Understanding Behavioral Style in Developing New Business – Part 2 by Bev Flaxington

In Part 1 of this two-part blog on behavioral selling, we discussed how behavior style impacts communication and why it is crucial for the successful advisor, business development representative or client services person to understand this science. Now, in Part 2, we give some sales examples.

If an advisor learns how to identify her or his own behavioral style, and learns all the nuances around it, he or she can learn the styles of buyers and influencers. Then, he or she can adapt their behavioral style to increase the probability of true connection with prospects and for developing long-term relationships – even with people very different from themselves. For business development people, this leads to an increased ability to close more business with new and existing prospects and clients. For client service folks, this means the ability to manage a long-term relationship even when there’s no real “click” of personalities.

In Part 1 we described the four styles – D for Dominance, I for Influencing, S for Steadiness and C for Compliance. Everyone has a “core” style, e.g. one dominant style out of these four; having determined that your prospect or client prominently displays the characteristics of one, your objective is to communicate with him or her accordingly. Here are some characteristics of each and how you’d approach them.

“D” – Interested in new & unique services or products; very “results” focused; makes quick decisions
“I” – Interested in showy and flashy products; focused on the “experience” (is it, or does it allow for, fun!); makes quick decisions
“S” – Interested in traditional products; very trusting and is looking for trust; is slow in decision making
“C” – Interested in proven, time-tested products; needs and seeks information; is very slow in decision making

As an example of communicating based on this knowledge, we’ll take the “I”. We’ll call this client Mr. Jones. He, like other core “I”s, is effusive and upbeat – an extrovert. They have a high need to verbalize ideas and their key emotion is optimism. Their expectations of others are high and their conflict response is to run away. Their stress reliever is interaction and socializing with people. Descriptors for them include inspiring, persuasive and trusting.

To further help you determine what core style you’re dealing with, there are four communication factors that are giveaways for each of the four styles. These factors are 1) Tone of Voice, 2) Pace of Speech and Action, 3) Words Used and 4) Body Language. In our example, how can you tell you’re interacting with a core “I”? Key on the communication factors for instant clues:
• Tone of Voice – it will be energized, enthusiastic, friendly and colorful
• Pace of Speech and Action – s/he will exhibit fast speech and fast action, and be fast toward people
• Words Used – fun, excitement, immediate, now, today, new and unique
• Body Language – you’ll feel the fast pace, the fast movement and orientation toward people.

Now that you’ve identified Mr. Jones as a high “I”, you must calibrate your own natural style for communicating with him. So if you are, say, a high “C” – as many advisors are – you need to make sure that you pick up your pace a bit, smile and nod your head to show that you’re fully engaged with the high “I,” keep the focus on them and ask questions, respond to their small talk and give them as much time as possible to verbalize. For a core “C” (or “S”) advisor, this can be exhausting – but you can relax after the meeting, which will be more successful if you adapt!

By taking the time to listen, observe and ask good questions, advisors can discern the behavior style of prospects and clients – and open whole new relational opportunities in the process. Next time, we’ll discuss some of the questions you can ask to help you determine style.

Understanding Behavioral Style in Developing New Business – Part 1 by Bev Flaxington

Have you ever been taken completely by surprise by a client or prospect? Or have you ever been unable to close a sale because you just couldn’t “get through” to them? Today, investors are being bombarded by so many advisors and business development people – all trying to connect and persuade them to become clients. However, one of the most fundamental ways to connect with prospects is often overlooked by those in a selling role: understanding behavioral styles and adapting one’s communication approach to the people s/he’s trying to persuade.

You may have at one time taken a training course on relationship-building, face-to-face selling skills, or something similar, but the key to understanding the buyer’s perspective necessarily begins with an understanding of behavioral style. This is because behavioral style is the crux of understanding communication style – and true communication is the key to developing great relationships in both your personal and professional life.
So, is it really true that your likelihood of signing new clients could come down to your behavioral style? Research conducted in 1984 and validated again every year since has proven three things: 1) people buy from people with similar behavioral styles to their own, 2) people in a selling type of role tend to gravitate towards people with behavioral styles similar to their own, and 3) if people in a selling or business development type role adapt their behavioral style to that of the prospect, sales increase.

Many advisors, business development and client service personnel have excellent communication skills, but have difficulty in relationships with prospects and clients – and don’t understand why. Something just doesn’t feel right, but they’re not sure how to diagnose the problem or modify their behavior for greater success. Often times, it’s not technique (i.e. the questions asked, presentation or negotiating skills, etc.) but rather a lack of understanding of one’s own behavioral style and motivators, and of knowing that behavioral differences can cause significant communication difficulties that hamstring closing a prospect or an ongoing relationship with clients.
One scientific way to understand behavioral style is through an assessment called DISC (Dominance, Influencing, Steadiness, Compliance). Based upon the work of Carl Jung, the DISC approach was invented by William Moulton Marston, inventor of the lie detector and holder of a Harvard MBA, over 80 years ago. The statistically based profiles show a person’s preferred styles on four scales of behavior – Problems, People, Pace and Procedures:

• Dominance (“D” factor) How one handles problems and challenges
• Influence (“I” factor) How one handles people and influences others
• Steadiness (“S” factor) How one handles work environment, change and pace
• Compliance (“C” factor) How one handles rules and procedures set by others

Depending on our differences in style and approach, we can either get along very easily together (because we’re so much alike!) or we can have significant clashes in our relationship.

A person’s behavioral preferences have everything to do with their communication approach and style. People who operate with very different styles have a difficult time “hearing” one another and communicating effectively. For instance, if I communicate only within my own behavioral comfort zone, I will only be effective with people who are just like me. However, in the corporate environment we are dealing every day with colleagues, prospects, clients and management – all of whom can be very different behaviorally. Not only is communication difficult where there are differences, but often individuals become hostile and conflict-oriented toward one another. Significant time, effort and corporate money is wasted because people are unable to “get along” and work together effectively toward common corporate goals. (Refer to the Brinker blog “Dealing with Difficult Clients” for a complementary discussion of this topic.)

In the next blog, we’ll take a “deeper dive” into behavior style – how you can identify it in your prospects and use this knowledge to improve your selling effectiveness.

Not Who You Think by Michael Zebrowski, Chief Operating Officer, eMoney Advisor

When asked to identify their most formidable competition, most advisors point to the advisor with the fancy office, lots of back-office support, fully integrated technology, and the book-of-business torn from the society pages. While such advisors do pose a threat, they probably are not enticing your clients so much as the computers those clients have on their desks.
The digital era has transformed the investment landscape, including the way in which clients manage their financial lives. More and more comfortable with online services for education and information, clients are intrigued by how well technology can help them organize their financial worlds, and they are migrating to direct-investment platforms, such as Fidelity Brokerage Services, LLC, The Vanguard Group, Inc., Charles Schwab & Co, and TD Ameritrade, Inc.
This trend is probably more pronounced than one might imagine:
• According to Cerulli Associates, Inc., direct-investment platforms grew from $2.6 trillion in 2008 to slightly under $3.7 trillion in 2010. This increase represents a two-year growth rate of 19%.1
• In contrast, the growth rate for the traditional channel, over the same period, was only 14%. Cerulli ranks direct-investment platforms as the second biggest distribution channel after the wire houses.2
• This direct platform growth happened organically and did so in spite of a lackluster market. In 2000 eTrade and TD Ameritrade had combined assets in the $53 billion range. In 2011 they accounted for nearly $426 billion in assets.3
Growth Drivers
There are a number of factors driving the growth of personal financial management platforms, including investments made in some key areas:
• Advertising and Marketing. With nearly $1 billion a year spent on advertising and marketing combined, self-directed investment platforms have become media darlings.4 No matter what information your clients seek on the Internet, they are likely to come across an ad or sponsored material from a personal financial management provider. The same goes for watching television, reading magazines or books, or driving on the highway. Direct-investment platform ads are everywhere. With so many dollars fed by personal financial management providers into both new and old media channels, no wonder anti-advisor headlines such as “Financial Advisors Are Biased, Study Finds”5 are on the rise.
• Education. Successful personal financial management sites have incorporated “research amenities” and robust client educational materials. When a consumer enters a certain section of the website, educational content appears. Users do not have to search for more information. It is just a click away.
• Technology. Personal financial management sites are focused solely on the consumer. Made as simple as possible, they are straightforward, intuitive, and interesting. They make trading easy and inexpensive.
• Client Service. While the sophistication of the support is debatable, one point is irrefutable: “help” is waiting in the wings 24/7. Many of the top self-service investment platforms have made enormous investments in call-center infrastructure to ensure that financial professionals are available at all times to answer customer inquiries.
The increase in personal financial management systems is a trend to watch. Clients, however, will always need financial advice. Their desire to work with a knowledgeable professional, someone who can help remove obstacles and keep them on the path to fulfilling their goals, will endure. As life gets more complicated, the need to work with a trusted financial professional will only increase.
The content above is from Michael Zebrowski of eMoney Advisor has not been produced by Brinker Capital, nor does Brinker Capital make any claims or warranties to its accuracy. Views expressed are those of Michael Zebrowski of eMoney Advisor and do not necessarily reflect those of Brinker Capital.

SOURCES:
1 Osterland, Andrew. “Advisers blind to threat of direct investing, study shows.” Investment News.
February 21, 2012.
2 Ibid.
3 Pew Research, 2010.
4 The Nielsen Company, 2009.
5 Berlin, Loren. Huffington Post. March 27, 2012.

What’s Your Headline? by Beverly Flaxington @BevFlaxington

Gaining exposure through publicity, social media and PR can be very fruitful for financial advisors. In too many cases, an investor does not know how to go about finding an advisor to talk with about their investments – so they may read about someone, or see a financial expert speaking, and decide to contact them. A robust PR and publicity strategy can be a great complement to other business-building efforts.
What’s the best way for an advisor to start a campaign, or infuse an existing campaign with new energy? First, it is important to determine your budget, and decide what exactly you want to do. It is awareness building? Is it positioning yourself as the obvious expert? Is it placing yourself where potential new partners and other industry professionals will see you?
Like any marketing or business-building strategy, it is critical to know – before you do anything – what you are trying accomplish, what forums are best for what you need, and what budget you can allocate to your efforts.
The next most important thing is to understand your positioning. What do you have to say to the media? What’s your publicity platform? What’s the headline you can use that will grab the attention of the people you are targeting and reel them in to learn more about you?
There are many things an advisor can do to get broader exposure. Be sure, before you commit to anything, that you get approval from your compliance department.
Some areas to think about if you want to embark on a broader publicity campaign could be:
Identify opportunities in your local area for press. Could you write a column for a local paper (online or in print)? Could you be interviewed on the local cable station?
Find timely information in the national press and make a comment about it – this can be done on your own blog, or by writing in to a columnist or sending out a press release.
Find opportunistic places for advertising. Broad-based advertising seldom works, but running an ad in the symphony brochure, or at a local play, or for some other event can get your message to a targeted audience.
If you have the time and can do your own radio show, there are many options on Blogtalk Radio and others to have your own show. Or, if you’d prefer not to have to manage your own show, find radio stations you can contact and pitch your ideas about why you’d be a great guest.
Be sure you have an updated LinkedIn profile. Periodically post new information to keep it fresh and interesting.
Consider having a Facebook page for your business. Post interesting information about local activities, or market news.
Scan the Internet for people who are writing and blogging about topics you care about. Post comments and link back to your firm if possible.
There are many ways to get your message out there more broadly. Remember to establish what you are hoping to accomplish, how much time and money you can spend, and what you’d like to see as a result. Then pick the tactics that work best for you.
Remember, though, your headline matters. Stay consistent with your messaging and reinforce your platform points and positioning every chance you get! Repetition matters a great deal in marketing.

Second Opinions on Investment Performance By Sue Bergin

There was a day when you could sense when someone was looking over your shoulder. Technology, however, has made those days a thing of the past.

With the increasing number and sophistication of personal financial management software sites and mobile applications, it is getting easier for your clients to get second opinions on the investment advice you provide.

Technology-driven portfolio analysis boasts the ability to provide independent and objective investment evaluation, which is appealing to investors on a few levels. From a client’s perspective, they can get a second opinion on your recommendations at no charge, with no obligation, and relatively little effort. Once data is entered, they have a convenient place to go for aggregated and up-to-date information and continual guidance.

The functionality and sophistication of these personal financial management sites and mobile applications is evolving at warp speed. Take SigFig for an example. SigFig aggregates all investment holdings then makes recommendations based on current holdings. It compares the holdings in a user’s portfolio against other investments in the same category and share class. It then provides suggestions of other, less expensive investments that perform better than the user’s current holdings. It even goes a step further. After reviewing the user’s trading patterns, it evaluates the brokerage fees paid. Even individual advisors are evaluated based on the fees assessed and performance obtained. This functionality has led to all kinds of provocative “Find out if your financial advisor is overcharging you” headlines!

Another media darling is Jemstep, which scored a “Use Jemstep to See if Your Broker is Wasting Your Money” headline. Jemstep’s ranking engine analyzes 80 attributes of more than 20,000 mutual funds and ETFs.
Jemstep helps clients identify their financial goals, provides a ranked list of the “best investment options” for that client, and tracks aggregated investment performance.

These services and dozens of others are gaining in popularity. They are free or come at a modest fee, and they have seized the attention of both venture capitalists and the media. Your tech savvy clients are likely to be aware of them, and very well may be relying on them for a second opinion of your performance.

Mapping Your Social Network by Matt Oechsli @MattOeschsli

by: Matt Oechsli

If you’re serious about targeting today’s affluent investor, it’s time to get social. We’ve become addicted to our digital toys (iPads, BlackBerrys, etc.), and social media is elbowing onto center stage. Our research tells us today’s affluent want to know their advisor on a social level in addition to their professional role.

Because the human species is such a social animal, you wouldn’t think this would be an issue for advisors. Yet many advisors are behind the curve when it comes to socializing with affluent clients, referral alliance partners, and prospects. Our research shows that investors clearly are more likely to introduce someone they know to their advisor if the investors have both a business and personal relationship with the advisor, as opposed to a relationship that was exclusively business.

Our research also shows that elite advisors intuitively recognize the importance of social media technology, and they’re early adopters. It’s the essence of both relationship management and relationship marketing. Today’s reality is that advisors who have both a business and a personal relationship with their affluent clients have more centers-of-influence penetration.

This data reinforces what we’ve learned from our rainmaker research—social prospecting in affluent circles today is what cold calling was some 25 years ago; it’s what public seminars were about some 15 years ago. And yet, at a recent workshop we sponsored on best practices of elite advisors, it was obvious that socializing in affluent circles made some advisors uncomfortable. Among the questions: “When do you talk about business? What social activities should you engage in?Do you mean that we’re supposed to mix business with pleasure?”

Socializing is directly linked to word-of-mouth-influence (WOMI), and advisors need to understand the importance of WOMI in affluent decision-making. It’s the high-octane fuel that activates the process; relationship management (affluent clients) and relationship marketing (penetrating affluent COIs) are inextricably linked in stimulating positive WOMI. This is a gift. Why? Because advisors can now schmooze with their top clients, meet their friends in a non-threatening environment, develop rapport, build personal relationships, and transition their clients’ friends into new clients. Knowing “who knows whom” is what mapping your affluent client’s social networks is all about.

Social network analysis

A quick glimpse into the budding field of social network analysis highlights the innate power of WOMI. Social network analysis, the study of social relationships between individuals and groups, goes back to the ancient Greeks. Modern theories arrived in the early 1900s, and today scientists study its implications in everything from relationships within high schools to the spread of disease.

We find this fascinating. Think about your web of contacts for a moment and ask yourself four questions:

1) If you were to chart your relationships with your top 25 clients, how many have both a business and personal relationship?

2) If you were to chart your social contacts, how many total connections could you list? How many have the means to conduct business with you?

3) If you were to chart your referral alliance partner relationships, how many connections could you list?

4) What type of branding is being broadcast through your social network?

Connected, a book by Drs. Nicholas Christakis and James Fowler, shares an example of how social networks play a role in marketing. They tell a story of two piano teachers in Arizona who grew their respective business only through WOMI; they never advertised or promoted their services. At the end of the year, they analyzed their clientele and discovered that 38 percent of their new business came by WOMI from people that hadn’t personally used their services. Their reputation was communicated through friends of friends of their clients—three degrees of separation.

Whether you have 25 or 125 affluent clients, imagine the power of WOMI within your business. Essentially, social prospecting is simply socializing with your affluent clients and prospects in venues that you enjoy, but with strategic intent. The idea is not to discuss business. However, whenever a business conversation surfaces, the social prospecting drill is as follows: listen; if asked, answer questions briefly; gently table that topic for another time; exchange cell phone numbers; set a time and place to discuss business; and continue socializing.

Elite advisors have turned mapping their affluent clients’ social network into an art form. If you allow yourself to get social, you can, too.

Financial Services Dipped In Chocolate

The UPS delivery person rings the doorbell.  I mentally inventory recent online purchases and realize with delight that it’s something unexpected.

Before I even get to the return address label, large letters grab my attention:

PERISHABLE:  ONCE OPENED, CONTENTS MAY DISAPPEAR IMMEDIATELY.

Oh good, something yummy.

Then more lettering beckons me.

INSTRUCTIONS:  CLOSE AND LOCK DOOR.  HIDE BEHIND LARGE PIECE OF FURNITURE. QUIETLY OPEN BOX.  SAVOR AND ENJOY!

I am so glad that the kids aren’t home!  I eagerly tear open to find a package of succulent chocolate covered strawberries, which I ate before even reading the gift giver’s note.

How Chocolate-Soaked Fruit Relates to Financial Services

Because Shari’s Berries delivered a memorable customer experience, it is now my top gift choice—no matter what the occasion.

Shari’s Berries is an excellent example of how packaging can convert a gift-recipient into a lifelong customer.

Packaging is anything that your client sees, feels, reads or handles.  In the financial service realm, packaging can refer to your:

–                     Office environment

–                     Website

–                     Social media presence

–                     Staff interactions

–                     On-hold messaging

–                     Marketing materials

–                     Communications

–                     Presentations

–                     Educational materials

–                     Client appreciation gifts and events

Whether the impact is more subconscious than conscious, packaging makes a difference in defining your clients’ experience.  It is one of those things that is difficult to measure, but packs a punch.  One might even go as far as to say that your packaging differentiates you from the advisor down the street even more than your expertise.

When it comes to the delivery of your services, think about your packaging. Are your written materials crisp and clean?  Do you refrain from using investment jargon?  Is your website readable and engaging?  Do you respect clients’ time as much as your own?  Are you using their preferred communication modes, (e.g., texts, e-mails, or phone calls)? Are your social media messages relevant and helpful?

The key is to take action that will evoke favorable emotions.  If you want your clients to feel secure, make sure your reception area is calm and inviting.  Guests are expected, welcomed, and greeted with green tea perhaps.  You are well prepared for meetings, anticipate their questions, and provide take-away’s that reinforce your message and reflect well on you.

Packaging can be a point of differentiation in a crowded market.  If done well, it can

Springboard Collaborative’s Alejandro Gac-Artigas works with Brinker Capital on a Video about his Initiative with written Commentary by John Coyne

Every once in a while you meet a young person who is so bright, energetic and dedicated to his or her calling that you want to do everything you can to help them succeed.

That’s how I felt about Alejandro.

I first met Alejandro Gac-Artigas through my relationships with Teach for America. I just knew that he would grow to be a great educator.

Brinker Capital provided financial support to help Alejandro earn his master’s in education from the University of Pennsylvania. We felt that it was an investment in not only Alejandro, but also the thousands of lives we knew he had the potential to impact.

It was a good investment. Alejandro has made us very proud.

After Alejandro’s first year teaching, he noticed something that caused him great concern. His returning students’ reading skills were about 20% behind where they had left off at the end of the prior year. When he shared his observation with other teachers, they put a name to it. They called it, “the summer slide.”

The Summer Slide

With limited access to books or computers and fewer high-quality educational interactions with their parents, elementary-aged students in low-income communities regress academically over the summer. Through his research, Alejandro discovered that summer reading losses amount to a two-year wedge between low- and higher-income peers by eighth grade.

The Springboard Collaborative

Determined to make sure his students didn’t fall behind, Alejandro founded the Springboard Collaborative. Springboard Collaborative combines targeted student instruction with parent training in an incentivized system that closes the literacy gap. He piloted a summer enrichment program in 2010. It was a tremendous success. The Teach for America organization was so impressed with Alejandro’s efforts, it named him, Social Entrepreneur of the Year.

We’re delighted to support Alejandro’s efforts to expand Springboard Collaborative in an effort to equalize the educational opportunities afforded to all young people.

Website: springboardcollaborative.org

Follow on Twitter @SpringboardPHL