Track 1: Next-level client communication that goes beyond automated emails

In this panel discussion, we will explore ways for financial advisors to engage with clients to build deep, long-term relationships. We'll discuss best practices for personalizing client interactions to boost satisfaction and lead to referrals. The discussion will also cover the importance of developing a communication plan.

Transcript :

Nathan Place (00:07):

All right, so I think we'll just get started. Thank you everyone for being here, and welcome to our panel. The topic is Next Level Client Communication that goes Beyond Automated Emails. I'm Nathan Place, Retirement Reporter for Financial Planning, and our panelists are Mollie Colavita, who is the Head of Practice Management at JP Morgan and Marguerita Cheng, a Certified Financial Planner and the CEO of Blue Ocean Global Wealth. So ladies and gentlemen, let's welcome our panelist, Mollie and Marguerita. Thank you. Alright, great. So I'll just dive right in here. Let's start by sort of defining the problem. So automated emails are right there in the title of this panel. What's wrong with something like an automated email for communicating with clients? Why is that not a good way to communicate? And either one of you can start.

Mollie Colavita (01:02):

I'll start. Okay. I mean, the first thing I would say is that we're all busy. I mean, if you think about your own lives, how often do you check your own email? It's just flooded. So I think in general it gets drowned out very easily and it makes it hard for you to really kind of customize and tailor the message. So it's it an important component, but I don't think that it is necessarily the most effective way to get your message across, just in light of how busy people are and how hard it's to keep track of all the things coming through.

Nathan Place (01:39):

Marguerita, is there anything you'd like to add to that?

Marguerita Cheng (01:41):

I definitely agree with it. It is hard to stand out. I mean, you want what you're saying to clients to know that it is, how does it affect them? What is timely? What is relevant? So I think a better word, it is efficient, but it's probably not the most effective way to communicate.

Nathan Place (01:58):

Right.

Mollie Colavita (01:59):

And there may be areas where it is, it does make sense. I mean, automated email isn't necessarily a bad thing. I think many firms, JP Morgan, one of them, we do have periodicals that we distribute through email advisors do. It's a good way to leverage your time, and I think people do value seeing things consistently. So if you've got a really great piece that is predictably sent out and it's got really rich content, you do see open rates are healthy. But in terms of personalizing the message, I think email, there are other forms of communication that might be more effective.

Nathan Place (02:35):

Yeah, absolutely. So what should advisors do instead? What's a better way of communicating with clients in order to build those deeper, more long-term relationships?

Mollie Colavita (02:45):

We're going to start with you this time because actually doing the work.

Nathan Place (02:47):

Okay.

Marguerita Cheng (02:48):

Well, I would say one of the most important things I do is I ask clients, I even do it as part of my onboarding. What is your preferred method of contact? Is it email? Is it voicemail? I think that's really important. How do you prefer to be contacted? And it can differ. And I think this is really important, particularly when you're working with spouses and partners. Do you want both people to be included or do you only want one? It really take the time to ask the questions. People will never be angry.

Nathan Place (03:22):

Yeah.

Mollie Colavita (03:23):

I would just pick up on that. I do think asking people their preferences is important. Sometimes they don't know or they don't know how to answer that question. So one of the things I've seen advisors do effectively is to say, my team has an operating rhythm. It looks like this. And it's the use of email for content. That's stuff you might want to read over the weekend. They sort of paint the picture for how they engage other clients and then ask the client to, you know, just simply ask them, does this make sense for you? What would you want to tailor? What would you want to augment? That way you're kind of leading them in a path that kind of fits with your operating model, but gives you the opportunity to get their perspective on what makes most sense for them so you can tailor that to their needs.

Nathan Place (04:12):

Right. Yeah, absolutely. And do you guys have any, maybe horror stories is too strong a term, but any negative examples of when a communication with a client didn't go well because it wasn't quite the right mode of communication or style?

Mollie Colavita (04:30):

I mean, horror stories. Can you say, I've got necessarily a horror story, but I, I'll give you examples. I mean, I've spent my whole life supporting advisors. My dad was a financial advisor, my sister's a financial advisor. I have worked in this business for 30 years and most of that time has been spent coaching and leading advisors. And so I've had the benefit of seeing them you in action. And I think we're really touching on this notion of communication and making sure that your message is getting conveyed the way you want it to. One of the things I remember an advisor saying years ago is if you've got two ears and one mouth, so the better prepared you are with open-ended questions to get the client to communicate and talk more so than the advisor, which is really hard to do because most advisors feel compelled to use the time they have to impart their knowledge and perspective and updates on what's happening in the market and what's happening within their portfolio or within their plan. But I think to the extent that you come with open-ended questions and give the client the opportunity to do most of the talking, you then do a better job of then tailoring your message using all forms of communication, both digital and human communication.

Nathan Place (05:46):

Yeah. And Marguerita, that reminds me of something you said during our prep call, which was that you often like to let the client set the agenda of the meeting rather than just coming in with your own agenda. Can you explain a little bit why you do that?

Marguerita Cheng (05:59):

Absolutely. So as we're setting the time to meet, I might ask them what topics would you like to make sure we discuss? And then I have things that I have prepared, and then I don't say the word, I don't use the word agenda. I say topics of discussion and then I rank them. You can do this in person, you do it via Zoom and it, there's a little bit of gamification. If you have a couple, you ask them to prioritize and then you get buy-in from what they want to talk about first. So the reason why this is so important, if I, let's just say I talked about college because college was before retirement and you were upset with the report card your kid brought home, that probably doesn't make sense. So it's really important for me to know what you want to talk about. And this is so well received because your husband said to me their goals were different, the priorities from the wife and the husband. The wife said she was most concerned about survivor income, which is life insurance. The husband was most concerned about retirement. So I said, because your ranking up priorities is different, where would you like to begin? And the husband said, you know what, I'm going to go with what my wife wants to talk about first. And the wife was like, honey, that's the best answer. That's awesome. And you know what? At the end of the meeting, the husband and wife were so thankful that we discussed it. He even sent me an email and said, you know what? I was really worried. I put on a lot of weight and I didn't think I could get insurance. He did get insurance. He's able to get 20 year fixed term standard. It wasn't preferred, but it was standard. And I just say that it's really important to just get the feedback from both because that is an example of me, the advisor, I can be prepared to talk about whatever they want, but it's important that I get their input.

Nathan Place (07:46):

Right. And to use a word that was in the description of this panel, how do you personalize your communications or customize it, I think is the word you prefer to use Margarita, everyone is different, obviously. How do you customize your communication style from client to client?

Marguerita Cheng (08:07):

You want me to go first?

Nathan Place (08:08):

Sure. Yeah, go ahead.

Marguerita Cheng (08:09):

Okay. Well, sure. So it could be something really small. Even when you are sending out these mass emails, make sure you take the time to put in the proper fields. Also, if you are using, I use Riskalyze now, nitrogen. Instead of having it be automated, I take the time to customize a little bit. It takes 30 extra seconds. And then with a Loom video, if I feel like someone may be having difficulty navigating the client portal, I will create a loom video. I will address them. I'll turn the camera on. This has been extremely well received. It takes, okay, if I need a couple takes, it might take as much as three minutes, but if I get it right the first time, it could be a minute. And so these little details really make difference.

Nathan Place (08:56):

Can you explain that Loom program a little bit?

Marguerita Cheng (08:57):

Sure. So Loom is an application that you can use and you can actually try it out for free. If you want to do the paid version, you can take advantage of the paid version. But if you only have, I think 25 videos, you can try it for free and you can turn your camera on if you want to. You don't have to, but you basically are sharing your keyboard. And so if you feel like maybe technology or you want to, even if they're great at technology, it's great to record a little video to welcome them. Hi Carolina, welcome to the client portal. I'm so excited to be working with you. This is just an extra step and it really makes them feel special. You can come see me if you want to know more about loom, but it's not a commercial for Loom, but I just want you to know that there are easy tools that you can use.

Nathan Place (09:47):

Right? It's an example. Yes, of course. All Mollie, I'll give you a chance to talk now. Is there anything else you'd like to add in terms of customizing?

Mollie Colavita (09:53):

Well, okay, so I do think it goes back to asking clients for their preference. And there is this notion of filtering that a lot of advisors wind up doing because you're trying to think for the client and you, you know them so well that you'll tend to sort of do the curation based on assumptions as opposed to asking the questions. So I'm just going to always start with, have the conversation. Don't be afraid to ask the questions. I think you're going to get more information from them than you might realize. And then leverage all of the ways in which we are communicating. I mean, we've learned that webinars work really well and some people prefer Zoom, believe it or not. There are ways to make that You can basically meet clients where they are in today's world, and so take advantage of that and leverage all the tools that are made available to you. When we were preparing for this session, we were talking about also leveraging the time you have when you are in person, because that happens with less frequency than it did prior to the pandemic. And you do pick up a lot of cues from body language and eye contact and paying attention to how people respond to what you're sharing. And that also can just help you think differently about how you're engaging the client. We were talking earlier about meetings where you've got both spouses as an example, don't make assumptions in terms of who the decision maker is, because you never know right upfront.

Nathan Place (11:26):

That reminds me of something really interesting you said during our last conversation, which was about assumptions about how you shouldn't make assumptions about what the client knows. Yeah. What we don't know. Yeah. Can you explain a little bit about that.

Mollie Colavita (11:38):

Well, I do. We all know we use a lot of jargon in this business. We use a lot of acronyms. We have have a way of communicating that makes a lot of sense to us, but not necessarily to the client. So taking the time to just speak in plain English, to sort of spell things out in more simplistic terms, but also not to make assumptions about what the client does or doesn't know. So just taking a moment to pause and check in to make sure that you're tracking is an important thing to do. It's not a monologue, it's a dialogue. And although I know oftentimes we come prepared with a lot that we want to convey, balancing that with open-ended questions to make sure that the client is with you and they're following, I think is really important.

Nathan Place (12:22):

And on the other hand, sometimes the client knows more than you think they might know. I mean, wasn't there a client of yours who worked in waste management or something like that?

Mollie Colavita (12:30):

Yeah, I mean, there's a lot of examples of clients whose source of wealth comes from many different industries, and just because it's not the financial services industry doesn't mean that they're not educated and informed. And so again, it's just important I think, to check in and make sure that we're dialing back the jargon and just speaking in terms that are easier to understand.

Nathan Place (12:51):

So what are some of the ways that you guys avoid that kind of jargon or avoid that kind of overly arcane language? And Margarita, I'll give you a chance to start on that one.

Marguerita Cheng (13:03):

So sure. One of the things I did want to share is even terminology that we are familiar with. It's really important that we're a mindful language we used. So I am based in Maryland that is right outside of our nation's capital. And you think about the terms conservative and moderate aggressive. I didn't do anything wrong or bad. I was helping a client, they're on the younger side with 401 K enrollment, and the wife saw the labels moderate. She said, she's like, honey, wait, I thought I was progressive. And he's like, no, this is about the asset allocation for your portfolio. So just taking the time to really explain things to people. One of the things that I really do is I spend a lot of time talking about risk, not just investment risk, but the other types of risk because investment risk, market risk is what people think about most, but there's also inflation risk, which is basically loss of purchasing power, longevity risk, which is that. And just making sure that clients understand that we have different types of investments to address different types of risk. And if somebody says, you know what, Marguerita, I just need you to break this down to me, I will break it down to them on their level. If someone needs more detail, I can do that. I mean, I studied East Asian language and literature and finance, so if you are like, I need to know how to calculate the standard deviation, I can show you on your financial calculator how to do that. But I think it's really important to just ask open ended questions. What do you know about X? Or don't say, do you know about? What do you know? And they'll tell you. And that's where I'm very much an introvert. We're asking a lot of open-ended questions has really served me well. So what has your experience been? Oh, it's great, or it was horrible. And then they'll start talking. So that is how you can deliver more customized approach to your client.

Mollie Colavita (15:02):

I mean, one thing I would add to that, I don't know how many of you work on teams or even if you're a sole practitioner, I think practice is something that doesn't often take place, but is a really good exercise. So I have seen best practicing teams and advisors spend time just speaking out loud what it is you're trying to convey, because the way the words sound when you actually speak them is different than the way they show up on paper. So just giving yourself a chance to talk it through and practice in real time before the meeting, I think is also something that's been helpful to many teams.

Nathan Place (15:38):

Is that a practice that the practice of practice is, is that something that you do before some of your meetings with clients Marguerita?

Marguerita Cheng (15:45):

Absolutely. I also work on the flow, not just practicing what I'm going to say, but maybe where I feel like we might need a break because it does a lot of information and just remember, clients truly are doing the best they can. It's important when people bring me information, I think about what I'm good at and I think about what I'm not good at. And clients come to us because they want help. Sometimes it's hard for them to be able to explain what they want. Sometimes it's easy for them to say what they don't want. And so I think that has been really helpful as well.

Nathan Place (16:22):

Yeah, absolutely. And I'm sure you're both very familiar with behavioral finance and the whole psychological dimension of financial advice. What do you think psychologically is the most important thing to communicate when you're speaking with a client? Just on an emotional level?

Mollie Colavita (16:41):

It really depends. It really depends on the client. I mean, that takes time, I think, to build that relationship over. I mean, that's one of the things that makes this profession so interesting, I think, is the relationships that you build with clients and getting to know them over time and getting to understand what their goals are and what their aspirations are. And that sort of, I think, tends to lend lead you down a path to build a bond that enables you to tap into that more. So I think it does take time though.

Nathan Place (17:11):

Right, Yeah, that's another thing I wanted to ask you guys about. How do you think client relationships most commonly evolve over time? What changes as you get to know them for longer and longer? Maybe I'll let you answer that one for Marguerita.

Marguerita Cheng (17:26):

Sure. I mean, I think what's really important is I never take the client relationship for granted. I mean, my children have the benefit of growing up in this business. So when I started in the business, my son was six months old, my oldest daughter was three, and my youngest wasn't even born yet. So I think I never take anything for granted. I'm not even that old, but I'm on the third generation, so maybe the grandparents hired me and I'm not with the grandchild. So I think it's important to never take anything for granted, to let people know how much you value and appreciate them. And I personally think for me, this is just me, what has served me so well is being empathetic, being diligent. I'll type of what I've read this five times and it kind of doesn't make sense. If you don't mind, can we follow up with HR? They're like, sure. And they follow up with HR. You know what HR, local HR says, this doesn't make sense either. We need talk to corporate HR. So I think what served me well, and I think is just being transparent, honest, of course that goes without saying, but if something doesn't make sense, it's say, I read this five times, it doesn't make sense. Would it be okay if we did X? Clients will always love you. They will appreciate that because that time I told you where it didn't make sense, the fact that we sent them to corporate HR, it was actually a difference of $500 a month in the pension. That person has been retired for 12 years, and the clients even said, I really appreciate that you had those extra set of eyes and ears. So I would say it's important to be detail oriented, be patient, and also be empathetic because clients are experiencing a lot and you don't know what they're experiencing. Some people will tell you, some people may not.

Nathan Place (19:21):

Right. What are some of the big challenges that clients are dealing with these days, particularly in this kind of strange economy? We find ourselves in the early 2020?

Marguerita Cheng (19:32):

You want to go just, you work with a lot of teams.

Mollie Colavita (19:35):

I think certainly there's been a lot of market volatility introduces uncertainty. And so I think that has prompted more conversation over the past couple of years than, well, I shouldn't even say past couple of years. Life is always changing. There's always something new. I mean, the fact that you're taking a planning based approach to the work that you do is so smart because it gives you a chance to check in and understand what's changed since the last time we spoke. What are you experiencing in terms of normal life events? And there's plenty going on around us to spark some discussion around what's the impact of this on my portfolio, on my planning goals, et cetera. So I can't say that there's one specific thing that's uniquely present at the moment.

Nathan Place (20:29):

It's a mix of factors.

Mollie Colavita (20:30):

Yeah, exactly. Yeah. Absolutely.

Marguerita Cheng (20:35):

I would say mean it's not anyone thing, but if you were to look at people who are just entering the workforce as well as our retirees, I think they want to make sure that they're taking a proactive approach. What else should I be doing? Is there anything I can be doing? And of course, like income, volatility and inflation, whether you are Gen Z or retirement, but it's not any one thing. But these are top of mind. So just being proactive and being there for clients and allowing them the opportunity. I think about younger clients, student loan payments are going to be kicking in, so being proactive. I know you don't have to make loan payments now, but talk to your loan service because the last time you made payments was three years ago. Just to make sure that the payment plan you had is the one that's right for you. And then there's, for retirees, there've been a lot of changes with requirement and distributions, for example, some people may not be aware of all these changes, so it is just don't take anything for granted and just make sure that you are, it's good to start with automated emails, but it doesn't have to end there.

Nathan Place (21:45):

Yeah, absolutely. And you also mentioned the importance of taking an interest or making it clear that you take an interest in your client. You're just telling us a really compelling story about one of your clients with regard to that before panel. Could you tell us a little bit about that?

Marguerita Cheng (22:00):

Absolutely. This was really profound for me. The daughter was my client, Gen X. I'm Gen X, and she started working with me, and I knew her parents had a financial advisor, and I wasn't going to solicit the business because they had a financial advisor. But the father approached me, he said, my daughter speaks so highly of you, and I love how you've helped her. I realized that I'm getting a little bit older. My wife is getting a little bit older, and I just want to make sure there's somebody that is in my wife's corner for that day when I'm not here. That was 10 years ago. They are still alive. They're 80 and 82 respectively. And the wife would come to the meeting with a notebook, and the husband was not being respectful. He was appraiser. He's like, Janice, I'm really proud of you for coming to these meetings, taking notes. That's just really incredible, but you're taking such an interest in your personal finances. She said this to me, and remember, this was a 10 years ago. This is before the pandemic. It was really profound, and the takeaway is it's never too early, it's never too late. She said, I am taking an interest in personal finance because Marguerita ta has taken an interest in me.

Nathan Place (23:18):

Wow. All right. Well, I think that's a great note to end on. So I'd like to thank our panelists, Mollie Colavita and Marguerita Cheng. Thank you so much for your time. Pleasure. Thank you let's have a round applause, panelists. Thanks.