Bob Veres Book Excerpt: The New Profession

Jun 15, 2017

veresToday, I am excited to share an excerpt from Bob Veres’ new book, The New Profession. Bob has had an amazing career as an editor and journalist, but mostly as an observer and commentator on our business, in a career that has spanned more than 30 years. I first met Bob in the mid to late 90s, and I’ve followed his career ever since. His ability to keep up to date with the profession and identify future trends keeps him busy as a sought after speaker and editor.

This excerpt details the great marketing opportunity that advisors have, as the profession evolves from sales to advice – which is what clients truly want. Bob’s book is truly a must read for any advisor who plans to be in business beyond the next 2-3 years. Please enjoy this excerpt from Chapter 2 of The New Profession, entitled Professional Marketing. You can order a copy of his book from 

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Some years ago, a financial planning firm asked if I would come into their offices and help them figure out why their marketing efforts weren’t working as well as they’d hoped. I sat in on one of their initial prospect meetings, and everything looked normal. The principals were dressed like investment bankers. They began the meeting by selling their impressive credentials as professionals and experts.

Then, with that preamble out of the way, they smoothly turned their attention to the prospects’ portfolio, evaluating the different account statements in detail, and outlining their own investment processes.

Later, in a focus group meeting, I asked some of the firm’s clients about the effectiveness of this initial meeting, and there were audible groans around the room. One participant told me that if the point of the preamble had been to impress her, it had worked perfectly. She was so impressed that her first thought was: “These people know so much more than I do about finances that they’re going to laugh when they see what a mess I’ve made of things.”

Her second thought was: “These people are so smart, they could steal all my money and I would never know what happened.”

Others nodded, offered similar perspectives, and then the conversation turned to the principals’ habit of looking at account statements before anything else. First, I was told, the account statements had nothing to do with why they had come to see this financial planning firm in the first place. And second, the chore of meticulously going through the numbers, and financially undressing in front of strangers, was painful. One participant compared it unfavorably to having a root canal procedure.

I asked: Did you get value from the relationship? Every person in the room answered in the affirmative. There had, in fact, been a lot of value over the years.

I asked: Would you recommend the firm to your friends and neighbors? People shook their heads. Probably not. Why not?

Because (people said in various ways) I would never put my friends and neighbors through this painful front-end experience. I don’t know if my friends and neighbors need their portfolios re-examined. And by the way, would it hurt if the planners wore a cardigan sweater occasionally, instead of these expensive suits that are so intimidating and make them seem so much less human and accessible?

Counterproductive marketing

The point: a lot of what planners think is helping them market their services may actually be counterproductive. To make matters worse, most of the marketing presentations you hear at industry gatherings are delivered by gurus who are paid seven figures a year to bring up the sales numbers of brokerage (aka “sales”) reps. Their techniques tend to have an element of slyness about them, with a heavy focus on products and overcoming (often valid) objections—and zero focus on a lot of perfectly reasonable outreach strategies that are available to a real professional.

Of course, the emerging profession has not been shy about creating its own obstacles, including the idea that you’re somehow violating professional ethics if you market your services. This is a weird reaction to the broker-dealer world’s oft-repeated phrase that “everybody sells,” and therefore, there’s no distinction between a sales rep and a professional planner. (As we’ve seen earlier, there IS a difference: professionals sell advice, not products.)

Others think that acting as a fiduciary means that any marketing you do is self-serving and therefore in violation of fiduciary principles. (This is clearly a misinterpretation.)

A perfect storm

The profession today is right in the middle of a perfect storm of business development challenges. Our best business developers will be retiring over the next 10 years, and one reason they’re hanging on into their 70s is because their younger generation successors seem (to them) to have no business development skills.

Meanwhile, the key referral sources that helped many professional planners build their practices are also retiring.

At the same time, most longstanding clients are moving ever-closer to death, and the profession has tenuous relationships with their spouses and heirs. Many of the heirs will choose to leave, rather than continue a relationship that they were never fully a part of.

And diminishing portfolios of clients are not being replenished by Gen X/Millennial relationships.

That’s a pretty bleak picture, right? Yet as the storm swirls around us, the financial planning profession is poised for the fastest growth in its history. We’re about to enter the most prosperous period that the profession has ever enjoyed.

How will the profession come through the perfect storm in better shape than it entered? For three reasons.

1. The professionals in the planning world will realize that they have far better marketing and “sales” tools at their disposal than their brokerage/wirehouse/independent BD competition.

Over the next few years, they’ll turn away from traditional sales tactics and start making the most of their fiduciary advantages. They will stop intimidating their clients in the name of impressing them, and learn that the best marketing is helping.

2.  Financial planning professionals will address a huge historical blind spot in their marketing efforts, by closing what in some firms is a 20-1 gap between the number of referrals their clients give them and the number of prospects who actually meet with them.

They’ll also raise their “close rate” on prospects who they believe they can help and want to work with.

3.  The emerging profession will finally pass one of its final qualification tests as a true profession by making itself available – profitably – to the vast blue ocean of middle-market consumers. This will make financial planning services accessible to the “other” 90% of the human species, and dramatically expand the number of viable potential clients.

Helping and engaging

Why do so many planners – particularly, young professionals – avoid marketing and business development today? Because they believe that bringing new clients in the door is a distasteful and anti-fiduciary activity.

Why is that? Because everything you read and hear about selling and marketing has an exploitive, sleazy feel to it.

Why is that? Because a very high percentage of the traditional business developers in the financial services profession – that is, brokers – are tasked with creating sly, exploitive pitches that will benefit themselves and their firms far more than the customer. And the marketing consultants and gurus who support this sales model focus their advice on facilitating exploitation, via techniques like overcoming objections, slyly misdirecting the customer, mirroring, reframing conversations and generally making it harder for the customer to say “No” when “No” would actually be the wisest response to this sales pitch.

When it comes to marketing coaches, facilitating sales is where the money is. The money is in helping salespeople do a better job of exploiting consumers.

So the first thing to understand is that if your primary goal is to deliver value to the person sitting across the desk, then the advice of marketing coaches, gurus and sales professionals is completely irrelevant to you.

If you can stop for a moment and make that shift in your mindset, and decide to engage in what I call “fiduciary marketing,” then this chapter will have made a huge impact on the success and prosperity of your professional career.

In fact, I would argue that you have a duty to your community and society at large to market yourself with great energy. A real professional should be willing to help everybody understand that there is a professional option available to them. Professional financial planners who are NOT marketing their services will cost consumers untold billions of dollars in hidden fees, commissions and shoddy investment performance.

You’re not marketing for you (well, not exclusively, anyway) but for consumers, for the people who otherwise would find themselves in the hands of brokers. They’re the beneficiaries of your business-building activities.

Bob Veres is the editor of the Inside Information service for financial planners, and a columnist for Financial Planning magazine.

This excerpt is being reprinted with the permission of Bob Veres. 

The opinions and views expressed herein are those of Bob Veres. SEI bears no responsibility for their accuracy.  Bob Veres is not affiliated with SEI or its subsidiaries

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John Anderson

John Anderson

John Anderson is the creator and lead author of Practically Speaking blog and Managing Director of Practice Management Solutions for the SEI Advisor Network.

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