High satisfaction levels increase client retention over the long-term, growing their investments with you and referring business to your practice, Sherise Mercer explains.
It is clear that highly satisfied clients drive better business performance. When we recently conducted research among financial advice and accounting firms into client satisfaction, we found the average percentage share of a client’s business increases with their level of satisfaction.
While we often may look to new clients to grow our business, the research suggests improving the experience of existing clients and building greater satisfaction among them is more likely to improve retention rates and lead to new business referrals.
This means for any advice business, large or small, focusing on the most important aspects of the client experience can have a considerable impact on building and sustaining your business.
In this year’s research, we looked at 27 separate service attributes, dividing the client experience into four ‘dimensions’ to make looking at the client experience more manageable
for advisers.
These key dimensions are: people, process, personalisation and perception of value.
Clients look to staff
The people dimension of our research looks at how clients view a firm’s staff expertise and the quality of their dealings with clients.
The research revealed that clients will only work with advisers that they like and respect, and who inspire confidence and trust.
Highly satisfied clients are then more likely to speak with their friends and family about you and your practice, with 90 per cent of clients highly satisfied with their advisers likely or highly likely to refer them to others.
This figure compared with only 18 per cent of moderately satisfied clients and one per cent of less satisfied clients, showing client satisfaction significantly influences referrals, which is important for business growth.
Overall client satisfaction is reflected by a firm’s knowledge and communication, as well as attention to detail.
This means that to build confidence and a strong relationship with a client, you and your team not only need to demonstrate skills and expertise, but be able to communicate effectively.
There are a number of initiatives you can use to instil confidence in the client relationship, such as personally introducing clients to all practice staff members they are likely to deal with at the outset, and by ensuring every interaction ends with a clear set of expectations around next steps, roles and responsibilities.
Reviewing your firm’s processes
Our research found that satisfaction levels are also influenced by a firm’s processes, from a client’s first meeting with an adviser, through to ongoing interactions.
A large part of making a client feel valued is setting expectations with them around timeframes and then delivering on those expectations.
In any service industry, clients are looking for value for money. Frequent, clear and efficient communication is fundamental to ensuring clients understand this value, as is high quality reporting.
Attention to detail from the main advice contact point within a practice makes a big difference to client satisfaction levels; however it is also essential for clients to receive high quality support from other staff regardless of seniority or role. This highlights the importance of setting clear expectations with clients on timelines and service delivery upfront, then consistently delivering to them.
Personalisation key to client satisfaction
Clients identified in our research that the personalisation attributes are collectively the most important driver of overall satisfaction among the four dimensions.
Effective client personalisation is more than just tailored service and reviewing the client’s needs.
It is about being proactive between formal reviews and having regular contact with clients to discuss any new information about their financial affairs.
This involves demonstrating initiative in managing a client’s affairs beyond their expectations, as well as tailoring your practice’s advice and communications for the distinct needs of the client’s financial lifecycle.
Proactively managing a client’s affairs and really understanding their needs is crucial to providing the best possible experience, and we know the client is taking notice of this.
It is all about anticipating issues, being solutions-focused and managing their day-to-day concerns, whether it is a question they may have about an insurance claim or helping them to lodge a form. Clients will take comfort in the fact that you are taking care of these matters for them.
Perception of value for money is crucial
In any service industry, clients are looking for value for money. Frequent, clear and efficient communication is fundamental to ensuring clients understand this value, as is high quality reporting.
In an industry often based largely on intangible services, it can be hard to demonstrate value to clients as the service provided is usually over a longer period of time.
However, regular communication can help to demonstrate the tangible value that advisers provide.
The research actually found that one in four surveyed clients would like to hear from their advisers more often.
Keeping clients informed can be either frequent communication over the phone or providing clients with something to take away from a meeting, such as a portfolio report.
When you get communication right, clients gain a feeling of confidence in both you and their financial situation.
Regular communication not only ensures clients are kept informed and up-to-date, it will also help to demonstrate value and increase the confidence they have in their adviser and the practice.
We frequently speak with our clients who reiterate the importance of quality communication, placing a high priority on being kept informed.
So what does this mean?
One of the biggest findings from the research highlighted that a key focus for advisory firms continues to be on the client’s overall experience, not just their financial outcomes.
While this focus might not be new, it does underscore the importance of providing an exceptional client experience to improve satisfaction levels and successfully build your business. Importantly, it emphasises the significance of continuing to provide efficient service, proactive portfolio management and tailored communication and advice.
It means great service, but also demonstrating competence, diligence and strong value to your client.
At the end of the day, satisfied clients bring greater potential for referrals and longer term, higher value relationships.
Directing your focus to the four dimensions that strongly influence client satisfaction will help you to drive better business outcomes and maximise the benefits of the advice relationship for your practice and your clients.
Sherise Mercer is a division director with Macquarie Wealth Management.
