We hope that this series of insight pieces drawn from the most recent analysis of Business Health’s CATScan* Client Satisfaction Survey data will help you to deliver the experience your clients are looking for and expect from you, their adviser.
The CATScan dataset now contains feedback from over 60,000 clients of Australian advisers. Unique and undeniable findings – premised on the fact that a quiet client isn’t necessarily a happy, engaged or satisfied client.
(*unless specifically stated otherwise, all stats and figures presented in this article have been derived from Business Health’s various data and research bases).
Retention rates for Australian advice firms have been consistently strong (90%+), practice profitability is steady and solid at around 30% and clients are happy to refer their adviser (87%). The vibe is a good one - “I know how my clients are feeling” (subtext - they’d tell me if they’re not happy), so why go to the additional bother (and cost) of seeking any additional feedback?
While these stats paint a positive picture, they can, in our experience, also unwittingly mislead by creating a false sense of security. Perhaps the most striking example is new clients, who should surely be satisfied as they’ve just appointed their adviser? Unfortunately not. Our CATScan analysis clearly shows that new clients are less satisfied with their adviser’s performance across all nine of the key service delivery areas covered.
Retained clients are only retained until they are not. The fact that they haven’t left doesn't necessarily reflect their level of satisfaction or indicate a high level of engagement per se.
Unexpected or unforeseen ‘stuff’ can sometimes intervene and create a moment for a client to pause and reconsider – a friend’s unexpected health issue, negative industry media, poor product performance or regulatory changes for example. There will always be ‘things’ happening in their lives and it would be highly presumptuous (not to mention dangerous) to assume the client relationship without seeking its validation through feedback from the client themselves.
In a somewhat damning finding, just one in four Australian practices (26%) sought feedback from their clients over the past 24 months.
In a professional service industry like ours which is predicated on trust and relationship, why wouldn’t you seek feedback from your clients? If clients today are accustomed to receiving personalised and exceptional ‘experiences’ from their other service professionals, then surely they’ll expect a similar experience from their financial adviser?Sometimes you have to listen very carefully to ‘hear’ what is not being said.
The drivers of dissatisfaction for 'quiet' clients
As the following table clearly informs, the three core drivers of client dissatisfaction (as measured by their willingness to refer and intention to remain with their adviser) are Reviews, Communication and Range of services.
CATScan KPI | Referrals | | Retention | |
|---|
| Would refer | Would not refer | Staying | Going |
Reviews | 4.15 | 2.54 | 4.10 | 2.52 |
Communication | 4.26 | 2.75 | 4.21 | 2.71 |
Range | 4.26 | 3.11 | 4.22 | 3.05 |
We’ll be drilling down a little further into each of these areas in future Advisely articles (spoiler alert) but here is a brief overview:
- Reviews – the adviser’s ‘moment of truth’, offering the perfect opportunity to present what’s been done, assess how clients feel about it and determine consequential strategies and actions. It’s perhaps the only situation where the adviser has complete control; they have power over everything from the timing to the content, participants, delivery platform, what's communicated and how. And yet……?
- Communication - unfortunately, whatever we’re saying and however we’re delivering it, it isn’t resonating with the client. This is not to say that it’s not being delivered in a compliant manner (because they are) nor are they being prepared in a lax way (because they’re not). The effort is there, so why is it that clients aren’t rating it highly?No doubt the nature of ‘advice’ and the vagaries that surround it play a part; it’s a complicated and complex business we’re in. But it can’t be an excuse.
- Range of services – the clientele of most practices is clearly greying; their needs are clearly shifting from accumulation and protection to being now concerned with the quality of their retirement, longevity and health. And unless their adviser can help them in these areas they’ll look elsewhere - aged care, gifting and estate planning for example.
How satisfied and engaged are your clients?
The quiet client isn’t necessarily a happy client. The practices that understand what their clients value, and act on what they hear, are better placed to retain trust, strengthen relationships and spot problems before they become reasons to leave.
Terry Bell, Owner, Business Health
