Financial Advisor Prospecting and Marketing in a Bear Market

By Amy Parvaneh, founder and CEO of Select Advisors

with Change Management Coach, Anne Sandberg

When society and the world around us seems to be falling apart, it can be tough to make smart decisions about our personal futures. In the last three years, it feels as though every possible calamity has befallen the people of the world. The Covid pandemic which began in 2020 still plagues us. An unparalleled confluence of geopolitical and national issues have more recently merged to create even more uncertainty amongst investors, employers, and individuals alike: Bear markets, “The Great Employee Resignation,” [see Pew Research] and Russia’s invasion of Ukraine are all impacting our current state of elevated apprehension and uncertainty.

For financial advisors and wealth managers, assisting clients in making the smartest financial decisions in times like these can be an all-encompassing and quite exhausting process. Many executives may find themselves hand-holding terrified clients, which means they don’t have the time or energy to even begin thinking about their business’s growth.  [See Kitces.com article on helping clients deal with market anxiety]

In such an environment, we’ve heard a recurring theme from advisors that they are too depleted to discuss their pipeline or prospect list, given that they’d been way too stretched helping describe the latest ball to drop in the news [see article on discussing inflation with clients], the ups and downs of the markets, and the headline news that keeps clients concerned. And even if they wanted to, they seem to have no time [see our video called “Time Blocking is a Waste of Time!] given that they are constantly either on the phone with clients, in client meetings, or monitoring the market uncertainty.

In fact, studies back up this major crisis in the wealth management sector: A recent report from Benefits Pro shared the following:

The pandemic has thrown other stressors into the mix of other stressors that come with being in the financial industry, including isolation during remote work, loneliness and difficulty drawing a line between personal and work time, according to the American Psychiatric Association. An APA survey found that employers were generally more accommodating of mental health challenges among employees during the pandemic, but employees across all industries remain reluctant to talk openly about mental health at work and are concerned about retaliation if they seek help or take time off due to mental health concerns.

For those working in the financial sector, pandemic-related stressors were multiplied. Many experts highlighted the connection between money and mental health during the pandemic. This tasked financial services professionals with tending to their own mental health while also helping their clients manage their mental health challenges related to financial disruptions.

According to Aon’s Global Wellbeing Survey, employee burnout and poor mental health as a result of remote working cultures and a growing climate of economic uncertainty is one of the primary risks faced by the financial services sector today.

The study found the top wellbeing risks impacting financial sector company performance in the wake of the pandemic were stress (67 percent), burnout (46 percent) and anxiety (37 percent). The study pointed to increasing workloads and long working hours as contributing factors. However, the study noted financial services professionals were already operating in a highly pressurized environment even before the pandemic.

In its report, Aon said the pandemic represents a line in the sand delineating a pivotal moment in the evolution of business operations and working practices. While businesses have been laser-focused on building business resiliency during the pandemic, they may have missed the opportunity to build resiliency among their employees.

But what about the opportunity?

But…isn’t this the time you, the advisor, have been looking forward to for the last decade?  As you may recall, just a year ago, investors were IN LOVE with their advisors [this was literally a term I heard from end investors, verbatim. See our video about this topic]. 

How could they not have been?  These investors witnessed their portfolios constantly go up, and everything seemed happy.  Who cares if the advisor never called them?  They just looked at their statement quarterly and assumed the advisor was the catalyst behind it all.

In fact, that was one of the main reasons advisors couldn’t get meetings with new prospects and they had to go chase “Money in Motion”, or new wealth created with no pre-existing experience with a financial advisor. Anyone who was already “working with someone” typically didn’t want to go out of their way and make a change. And if they did, it had to be truly bad.

Remember when THIS title was the headline?

Now?  Anyone who’s been in wealth management for over 10 years could assure you this:

THE best time to prospect is during a period of market uncertainty!! 

This is a time when investors are OPEN to new conversations about the markets, new processes, new platform to bash their existing advisor who “lost” them so much by not calling them. 

Believe it or not, uncertain times such as the ones in which we are living are positively rife for opportunities to make big, bold changes to grow your practice. 

If you are in agreement with my statement above, that this is the best time to reach out to old leads, new prospects and people open to a conversation, then you need to mentally recharge you and your team to be prepared to lead with a highly energized and motivated mindset.

If your team is exhausted, depleted and discouraged, the energy will be felt by the recipient of your “pitch” and you will lose any such opportunity to start a conversation.

One of the many ways Select Advisors Institute helps financial firms to navigate the murky waters of uncertainty is through Change Management Coaching. Such a training style allows time for our clients to focus both on their own mental health and well-being, while actively growing their firm and learning strategies for assuaging current clients’ fears. 

Learning and developing active change management skills will help you communicate with and reassure your clients.   It will also help your team be able to recharge and communicate with new prospects in a healthy way. 

How do you start building Change Management Coaching as a leader within your Team, RIA and client base?

Consider the following five change management tips:

1) Explain that risk is different from uncertainty.

While risk is quantifiable, uncertainty evokes fear. There is no way to measure uncertainty; this can cause us to feel afraid, since we cannot protect ourselves from the unknown. Attempting to understand both the situation and our fears about it are best practices in maintaining a calm, clear head, which is necessary for making the most informed decisions. 

2) Let the client’s emotions surface: listen and carefully observe.

Carefully listen to what your clients are saying. Be mindful about trends or themes you hear; this will help to build empathy and understanding of their subjective position. Resist the urge to jump in and problem solve; sometimes, talking out the problem is the first step to resolving it and your client might really just need a sympathetic ear.

3) Look for triggers to past experiences.

Sometimes, a past traumatic or stressful experience results in the inability to think clearly about one’s present or future. Current stresses may trigger emotions related to previous experiences, which can lead to rash action in the moment. Knowing a client’s specific triggers will help to comprehend their stress responses and offer solutions tailored to their particular circumstances. 

4) Resist judging, pontificating, and taking over. 

Every personal experience is entirely subjective; without the benefit of having experienced what your clients have experienced, you may not understand where they are coming from. Always attempt to keep an open mind when listening to others’ fears, and challenge your own need to talk when you should be listening. 

5) Be a reliable source of information.

You are the expert: Your clients rely on you to provide the most accurate and reliable information about their finances. When times are uncertain, clients will often seek more regular communication. Create and adopt a communication strategy to keep your clients abreast of the market and economic conditions. You may consider offering special services like educational workshops, weekly updates, newsletters, or others. Make sure your clients know that you are present and willing to help in any way you feel comfortable.

So: Will you look at this time as a threat or opportunity for your business?

Are you energized and excited enough to re-start networking and prospecting, given all the anxiety and uncertainty around you? If you’re not, the recipient can feel it.

When uncertainty strikes, remember: You do have options.

Many people will make rash decisions based on fear. When we cannot reliably determine what the future holds, fear can drive our responses; this is a means of taking control when we feel control slipping through our fingers. But choosing fear is not the only option. In times of uncertainty, those who make bold choices centered in calculated opportunities are those who often achieve more in the long run. 

Select Advisors Institute can help you feel more confident in having tough discussions with scared clients who are ready to entirely pull out of the market. Our coaching sessions are the ideal way for you to be the best possible advisor in these wildly uncertain times. Instead of freezing and not taking action in any direction, invest in yourself, and you will be able to help more people invest in themselves.

Schedule an introductory meeting with Select Advisors today. 

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