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As a financial advisor, you are always in sell mode. To acquire clients, you must convince them to change their wealth management strategy and pick you. To keep them, you need to move them to your advised action and then value your services over alternatives. While many of your clients are attracted to financial results, it is likely you’ve experienced situations where your advice wasn’t followed, even when it was the perfect prescription for the situation. You likely scratched your head, wondering, Why didn’t he get it?
The answer comes from social psychology research: Your mind’s neural network must be predisposed to respond favorably to your influence attempts. If your mental pump isn’t “primed,” then even the most persuasive arguments won’t be accepted and acted on. In other words, the situation is as important to a person’s decision-making as the logic of what’s being presented.
Of all the sales professionals I’ve interviewed for my books, Dan Veitkus may be one of the most well-rounded in his talents. He’s been a top performer in the highly competitive software industry and today he sells executive search services to Fortune 500 companies. By well-rounded, I mean that he has both emotional and technical intelligence. “When you move people to action,” he told me, “you do it in a particular situation, which must be emotionally designed for acceptance and change.” He realized early in his career that you have to set the table for the sale, and not rely on product or pitch alone to win the day. He was conscious of where and when his meetings took place, how his clients were feeling that day and what he could do to “lift their spirits to action.”
To create something valuable, you need to think through each stage of its creation, tackling every obstacle along the way.
Time and Place
The context in which you deliver advice is just as important as the content of your message. National events or personal tragedies can distract your clients or, worse, put them in a mental state of confusion. If you’ve ever tried giving long-term financial advice to someone after a major dip in the stock market, you’ve witnessed firsthand the impact of timing on decision-making. On the flip side, if you can time your meetings to positive milestones such as someone getting back from their summer vacation or celebrating the holidays, you’ve likely seen a bump in willingness to listen, believe and act.
Where your conversations take place also determines your ability to influence. If you meet at a crowded and noisy restaurant, you and your client have to overcome numerous distractions to focus on any topic and come to agreement. If your office is dark, cluttered or in a noisy, open workspace setting, you aren’t putting your client in in an environment that’s conducive to learning. If your consultation happens by mobile phone while both of you are out and about, getting any point across is hit or miss.
When your client’s mood is negative, his or her ability to make the right financial decisions suffers dramatically. One study1 at the University of Miami found that when people have a negative mood state, it interferes with their brain’s working memory, causing lapses in critical thinking. This jibes with a study I participated in with HeartMath Research Institute2 where we found that mood states trigger chemical flow in our body. Negative moods triggered a release of the stress hormone cortisol, which inhibits our ability to leverage our brain’s capacity. Positive moods spurred production of DHEA, an enzyme that’s known to enhance our clarity.
The mood state can also influence how your client thinks about investment risk. Researchers at the University of Leeds in the UK found3 that when people are in a negative mood state, they are more likely to take a long-shot gamble in order to reverse their mood. The same research also revealed that when people are in a positive mood state, they are more likely to choose low-risk options in order to maintain or enhance their mood.
Steve Jobs believed that “design is the constant act of problem solving.” In his view, if you want to unleash magic, you must be willing to pay attention to the smallest details. To create something valuable, you need to think through each stage of its creation, tackling every obstacle along the way. Like a designer, think through the emotional experience that your client goes through as he or she considers your advice. Be as holistic as possible: step back from the facts and figures and consider the surrounding environment. By putting yourself in their shoes, you’ll discover new ways to improve your ability to help them help themselves financially.
1The Impact of Negative Mood on Cognitive Control, Joshua Rooks, University of Miami, Florida
2Cardiac coherence, self-regulation, autonomic stability, and psychosocial well-being, Rollin McCraty, Maria Zaya, Institute of HeartMath, Boulder Creek, CA. http://journal.frontiersin.org/article/10.3389/fpsyg.2014.01090/full
3Effects of negative mood states on risk in everyday decision making G. Robert J. Hockey, A. John Maule, Peter J. Clough, Larissa Bdzola, University of Leeds, UK. http://bit.ly/2l8G00S
The views and opinions expressed herein are those of the author, who is not affiliated with Hartford Funds. The information contained herein should not be construed as investment advice or a recommendation of any product or service nor should it be relied upon to, replace the advice of an investor’s own professional legal, tax and financial advisors. Hartford Funds Distributors, LLC.