Marketing Insights from the Trenches

In contrast to their high level of investment and financial planning expertise, I’ve never met an advisor who was trained in how to convert a prospect into a client. Each advisor has their own idiosyncratic method for engaging with prospects. Few can provide any support for their approach.

The requirements for holding yourself out to the public as a financial advisor are quite low. There is no minimum educational requirement. You just have to pass a three-hour examination administered by FINRA.

The requirements to offer training advice to advisors is even lower. None exist.

You don’t need a minimal education or even to pass an exam. You aren’t required to have evidence supporting your training methods.

Consequently, there are many “experts” on social media and elsewhere expressing diverse opinions on how to deal with client issues, what to say in certain circumstances and how to deepen relationships with prospects and clients.

It reminds me of this insightful quote from legendary engineer W. Edwards Deming: “Without data, you’re just another person with an opinion.”

Of course, we’re all entitled to our opinions. But if we are asking to be retained to train advisors, our opinion should be supported by solid, peer-reviewed evidence.

3. Underestimating naïve realism

A lot of advice proffered to advisors is the product of naïve realism, but it’s not identified as such.

Naïve realism is the tendency to believe our perception of the world reflects unbiased reality.

Rarely is this true. Our perception is heavily influenced by our own biases.

Here’s a good example of how naïve realism can lead you astray.

It’s common for “experts” to explain how certain life strategies have worked well for them and assume they must be right for others.

If an expert has found great personal satisfaction by taking meaningful risks (like helicopter skiing or bungee jumping), all that means is those choices were right for that person. When the consultant recommends these experiences to others, the premise is flawed.

What works for the consultant may not be right for you.

Experts’ opinions, offered without data, fit into the category of naïve realism.

Before you engage a marketing consultant, ask these questions:

1. What is the evidence underlying your strategy?

2. Can you show me testimonials from advisors who have had a positive experience with you?

Dan trains executives and employees in the lessons based on the research in his latest book, Ask: How to Relate to Anyone. His online course, Ask: Increase Your Sales. Deepen Your Relationships, is currently available.

Read more articles by Dan Solin