Wells Not Fences: Client Retention Through Attraction, Not Restriction

By Amy McIIwain, President, Financial Social Media on Monday, October 31st, 2011

Growing up in rural southern Indiana, I was always impressed with the wisdom of farmers. Even as a kid, I admired their ability to manage through many hardships. After hearing a story from a leader in the global IT industry, my admiration of farmers has increased – and it provides a terrific question we should all financial advisors should be asking in today’s hyper-competitive marketplace.

Following my recent keynote for the annual sales conference of telecommunications giant Telstra in Melbourne, Australia, Paul Geason – their Group Managing Director for Enterprise and Government – related his rural background in Tasmania, and a story about farmers in his country.

In the vast fields of Australia, erecting fencing to keep the cows on your property and protect your investment is both exhausting from a labor perspective and expensive from a financial one. And, no matter how well your fence is constructed, sooner or later, cows will break through it – requiring an intense effort to track them down and bring them back.

However, Geason said, farmers discovered that when they would dig wells on the property enabling the cattle to drink fresh, cool water, the refreshment was so appealing to the cows they wouldn’t wander.

In addition, the deeper and better the well, the colder and more desirable the water became to the livestock – meaning, of course, the odds were enhanced they would never stray.

Geason then drove home the powerful impact of his story. “Many times,” he commented, “I think companies do all they can to fence in their customers. We spend a lot of money to get them into our fields; then, we do all we can to confine them so they don’t get away.”

It’s occasionally (and unfortunately) seen in the efforts of financial advisors, and how they communicate with the client. Often, it’s a plethora of messages about obligations and consequences established in an attempt to ensure that once a client commits to us, they won’t break through our fences.

“Wouldn’t it be preferable,” Geason asked the group, “if we made it so customers really wanted to stay with us, rather than force them to decide our price of departure was unbearable? What’s the long-term advantage of holding a customer hostage?”

“Wouldn’t it be better, if instead of building stronger fences, rather we committed through our communication to dig more and deeper wells?”

In our quest for client connectivity, we often forget that any situation where loyalty is involved requires a reciprocal commitment.

This is the critical reason the terms “client service” and “client experience” should not be used as synonyms. “Client service” means we are friendly and efficient; we are responsive to client’s needs and wants in a timely fashion.

“Client experience,” on the other hand, requires personalization and emotional connectivity. It is the only way to create client loyalty, for none of us will ever be loyal toward something to which we have no feeling. Why would we become loyal to any individual or organization that fails to engage equally with us?

And – as it should be obvious – the only way we can deliver this aspect of the practice is to enhance our communication with our clients.

Farmers have learned something all business people should take to heart: When it comes to livestock — and customersdigging wells is infinitely superior to building fences.

Scott McKain is the author of three #1 Amazon.com business bestsellers -- including "Collapse of Distinction" named by the "Miami Herald," "Huffington Post," and many other major news outlets as one of the "Top Ten Business Books of 2009"; Co-founder & Principal of The Value Added Institute; and Member of the Professional Speakers Hall of Fame. For more, visit Scott’s website at http://ScottMcKain.com, or check out his blog at http://McKainViewpoint.com 

Scott was the guest presenter in a recent ByAllAccounts webinar entitled "Create Distinction: How to Stand Out in a Crowded Financial Advisory Space". To watch the full on-demand webinar replay, CLICK HERE

Check out this video below to watch highlights from the webinar!


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