There are significant hurdles that must be overcome for busy executives to carve out the mental and emotional space to engage a new financial advisor. Fortunately, there’s a strategy that can help you stimulate more of these high-quality engagements.
Other Industries Have the Same Problem
The direct-mail marketing industry has been grappling with this problem for decades and can offer insight into how to get a busy professional interested. There’s a reason you repeatedly receive the same mail advertising over weeks or months—the same tiny percentage of people respond each time a piece is sent.
This is why: response rates remain largely the same even after the first, second and third mailings. Marketers have learned that many people need several exposures to the same message before the offer breaks through to their conscious awareness. The advertisers repeat the same offer to the same group, and each time, a few more people “wake up,” recognize the value of the offer and respond.
As a financial advisor, the implications of this are significant: you need to repeat a similar message many times in order to get a C-suite executive to wake up and pay attention to what you have to offer.
Behavioral Finance to the Rescue
Researchers have looked at why busy people pay attention to a few select issues and ignore many others: they’ve labeled the behavior narrow framing.
When we use narrow framing, our brains edit out of awareness all information except the most immediately important stimuli. This hardwired response is designed to protect us from danger: if there is the possibility of harm or too much complexity, the brain takes over and focuses on a smaller, more manageable set of information.
For example, if you’re on a hike and encounter a snake, your brain automatically zooms in on the danger and ignores everything else. This allows you to respond to what’s most important at that moment. In the same way, if you’re driving your car and a warning light starts flashing, you may zoom in and focus so tightly on the warning indicator that you may miss something on the road.
What Does This Have to Do with Plan Participants?
As executives climb the ranks and arrive at the C-suite, their workload becomes complicated. At the same time, their financial success tends to create complex potential hazards in their personal financial lives. Most C-level plan participants are overloaded with challenges, dangers and distractions that make it difficult for them to shift their attention to the next stage of their life even when they are months or weeks away from retirement!
This is an important insight for advisors who want to work with C-level plan participants: at the very time when working with a financial advisor is most important for their long-term financial well-being, most C-level executives find it difficult to allocate the mental and emotional energy to engage with an advisor.
At the AllianceBernstein Advisor Institute, we recommend that you take a lesson from the direct-mail marketing professionals: start sending short, useful resources to the C-level plan participants you work with to educate them about the key issues they face as they transition to retirement.
- Develop a series of short articles or checklists of issues that need to be addressed before the transition to retirement.
- Set an age trigger for when to send each checklist or article.
- Assume that most of these messages won’t break through, so be patient, but also assume that eventually a helpful message will get through.
Once you understand the complex lifestyles that C-level executives face and how their brains protect them, you can develop a messaging process that focuses their attention on preparing for the next stage of their lives.
Ask your AB Regional Manager for a copy of the AB Advisor Institute’s Wealth-Management Checklist or Preretirement Checklist.