In an increasingly competitive landscape, most financial advisors have succeeded by providing quality service that retains their existing clients, with the average financial advisor retention rate at 94%.
Yet the challenge is that while offering great service may keep clients on board, it’s incredibly difficult to use “great service” as a differentiator. In fact, according to one recent study, 72% of all advisors differentiate on client service. And by definition, when the majority of advisors differentiate on the same point, it’s not differentiating anymore!
In addition, differentiating on service is also difficult because there’s no clear and consistent definition of what “great service” even is. Especially since what is great service to one client may not be to another. What constitutes “great” is truly in the eye of the beholder.
Which means at a minimum, for advisors who do want to differentiate on great service, it’s necessary to truly articulate what “great” really means (and for whom). For instance, advisors might craft a “Client Service Standards” document that explicitly states what “great service” really means, at least from the advisory firm’s perspective in trying to serve its ideal clients. Of course, then it’s also crucial to affirm that what the advisor thinks is great service is really perceived that way by the clients themselves. And if you commit to it, be certain you’re really ready to deliver it, too!