How Strong Are Your Client Relationships?

In the current issue of his "The Trusted Financial Advisor" e-newsletter, Bill Bachrach makes a great point about measuring the strength of your relationships with clients. He writes:

Ask most Financial Professionals if they have good Client relationships, and they say, "Yes, of course." Ask them how they define a good client relationship, and it gets a little fuzzy. Sometimes we describe our Client relationships more by how they feel than by tangible evidence. "We have rapport." "I like them and they like me." "We have been doing business for many years so we must have a good relationship." "They own three products I recommended." Much like a good golf shot is more effectively measured by where the ball lands than by how the shot feels, great Client relationships are better judged by proof than by feelings. If you have ever hit a golf shot that felt really good, but the ball didn't go where you wanted it to go, then you know what I mean.

Bachrach goes on to identify five criteria you can use to determine in a more scientific way just how strong your client relationships really are.  I have reframed these as questions to ask yourself.

1. Do you know where all the money is? Bachrach suggests that if you're still discovering assets months or years into the relationship, the client is sending a message that you need to hear.
2. Does the client do what you advise with little, if any, explanation, and no need to "sell" your advice? When clients listen to you, it's not because they're ignorant or lazy, Bachrach explains: it's because they trust you.
3. Is the client influenced more by you than by other outside sources? Again, Bachrach points out, this is a matter of trust. If CNBC holds more sway over your client's opinion than you do, something's wrong.
4. Does the client understand that you don't control market conditions, interest rates, world economics, etc.? As Bachrach points out, no one enjoys bear markets, but great clients don't blame you for them.
5. Are you getting referrals from the client? If your relationship is strong, you should certainly be getting at least a few unsolicited referrals—and if you're positioning your requests in the right way, you should DEFINITELY be getting introductions and referrals when you ask for them.

Here are some helpful articles about measuring and encouraging client loyalty (free registration required):

Raving Fans: 7 Examples of Intense Client Loyalty
You know you've got loyal clients when they call you on your birthday. Or invite you to sail around the Bahamas. Here are seven stories of true client commitment—and tips for strengthening your clients' devotion.

Ask Your Clients, 'How Am I Doing?'
If you're not sure what your clients think of you, ask them. Here's a step-by-step approach to using a client advisory council to elicit the most useful feedback from your top clients.

How to Turn New Clients Into Loyal, Referring Fans in 90 Days
Are you guilty of neglecting clients once you've won their business? It's tragic how many advisors drop the service ball in the first 90 days. If you don't have a system in place to contact your new clients eight to 10 times in the first three months, you're missing a huge opportunity to build loyalty and earn referrals.

Cement New Client Relationships With a 45-Day Review
A well-trained client is an enjoyable client, so be sure your intake process includes scheduling a 45-day review meeting. Remember, new clients often feel anxious and uncertain with a new advisor. Use this meeting to allay doubt, reinforce value, and hook your client for life.

15 Ways to Inspire Total Client Devotion
You work hard to land new clients. But how do you move them along from the fleeting glow of opening that first account to a deeper loyalty that inspires passion, friendship, and enthusiasm? The answer comes from the faithful employment of three ancient ideas.