Engaging with Upset Clients
Every financial advisor has had to deal with upset clients at some point in their career. How you do it is even more important to the outcome than actual the solution to the issue. Here are several key points to remember as you prepare to speak to the client.
First, understand that the client will be in the grip of emotions that can range from unhappiness to anger. It is imperative that your approach is one of calm politeness, devoid of defensiveness. Speak slowly and softly. Second, let them vent and don’t interrupt until they have had their say. Pay attention to their vocal tone and, if you are meeting in person, their body language. Be sure to empathize with them as a way to validate their feelings. Acknowledging how they feel is critical. Respond by saying “I can see why you’re upset or frustrated about this.” You may follow that with “I see your point” or “I’d feel the same way “ (if indeed that is true).
Then, propose a way to deal with the issue or solve the problem. It’s always better if you can offer them several options and ask for their input: “There are several ways we can move forward. Which seems best to you?” Importantly, though, never make promises you can’t keep. That will only exacerbate the problem. Finally, thank them for sharing their feedback with you and giving you the opportunity to respond and hopefully rectify.
At times, you may have to be the bearer of bad news. It may range from an order not being filled or one being entered incorrectly to a check sent late and to dealing with severe, perhaps unexpected market downturns. On occasion, it may even be about issues not related to their portfolio. Whatever the reason, sound confident about what you are saying. Some problems are more easily solved than others, such as entering an incorrect number of shares or the wrong ETF or stock. For sudden market downturns, say you understand it is not what they expected or a development they wanted to hear, but then discuss how markets often react to such downturns, the time it may take for the market to regain lost ground and the reason they have to maintain their current asset allocation, unless, of course, they say their risk tolerance has changed.
The most important thing is to contact them as soon as you can following a significant downturn. When clients don’t hear in a reasonable time, their emotions intensify, especially fear, and now the problem is lack of timely communication in addition to the market concern. If you did not originally manage expectations as well as you should have, admit that and say you will do a better job of making sure they understand and then showing them how you intend to do that.
Finally, if a client becomes abusive, yelling or using profane language, calmly say to them that you cannot help them when they are yelling or cursing and ask them to take time to calm down and then call back. No one needs to be subject to such disrespect. If a situation requires it, escalate the issue to your branch manager, market executive or division manager; and, if the issue calls for it, notify Legal. If a client has been abusive to a staff member, the team leader should call the client immediately and remind them that such behavior is unacceptable. One advisor used to end such conversations with this statement: “I love my career and my clients because it’s all based on trust and respect. Do you think we have that?” You may find that to be a magical question. If not, or if these situations arise more than once, it may be evidence that you need to tell the client to find another advisor. If they can’t respect you, they will not respect what you have to say.
Mistakes happen. No business can run without ever having any errors. But research shows that the ability to handle client complaints effectively and in a timely manner actually results in increased client satisfaction and loyalty and promotes better client lifetime value. It’s well worth your time and effort to sharpen your active listening skills and other key relational skills, such as calmness, empathy and considerateness and especially patience. Most clients will remember more about how you handled their complaint or concern than about how it was resolved.
About the author
Robert B. Seaberg, Ph. D., Visiting Faculty, Spanning a career of forty years in financial services, “Dr. Bob,” as he is known in the industry, began as a financial advisor and then moved into strategic marketing directorships. He has spent nearly two decades with Citi Smith Barney and Morgan Stanley as a Managing Director in charge of Wealth Advisory Solutions. He pioneered the use of regional wealth planning centers, helped develop an industry-leading HNW and UHNW training and designation program for select advisors (Family Wealth Advisor) and established the Philanthropy program.