Instances of market turbulence highlight the importance of client engagement and communication for financial professionals. Anxious investors want to put market volatility in perspective, and their needs go beyond talking about investment strategy. While investment advisors cannot influence markets or predict the future, we believe a thoughtful and consistent communications strategy can be an effective way to build stronger relationships during these volatile periods. Here are our views on four elements of an effective outreach plan:
Be empathetic. Listen to concerns and fears. Clients want to feel that they have been heard and that their concerns are understood.
Be strategic. Remind clients of their financial goals and timeframes. Keep the focus on the big picture and the long term, but be sensitive to short-term uncertainty. Evaluate the potential implications of market volatility on the investor’s portfolio; understand how it may impact their overall situation, including their ability to meet short-term financial objectives.
Be proactive. Financial professionals should not wait to be contacted. Reaching out first can reinforce the relationship and illustrate the value of having an advisor. Show that you are doing the utmost to understand current market conditions and analyze what action may be appropriate for your clients.
Be comprehensive. Pacing communications and using a mix of mediums -- from direct phone calls to personalized emails, group communications, or social media updates -- may reinforce the role of the financial professional as a trusted and vital partner for the long term.
An investment advisor’s role is to provide objective advice and guidance to clients investing in complex markets. Often, this effort can mean simply being present and helping guide clients through difficult investment climates. Neither markets nor client emotions can be controlled. But what can be controlled is how the advisor reacts, communicates, and guides clients through periods of volatility. All this may be common sense, but be sure to translate it into common practice.
