Credibility & Relevance

The Circle of Relevance -
How you can prove your credibility!

Credibility depends on relevance.  You must prove that you're relevant to that client.  Relevance means that you understand the client’s situation and can provide valuable insight on topics of immediate concern to that specific person.  This is a point of wisdom, and it’s what rookies often do not have because their experience is limited. 

In other words.  You could be the world's foremost expert on asset allocation or stock options or anything else. But, if your area of expertise is not vitally important to that individual prospect right now, it is simply irrelevant.  Making a presentation without the Relevance Factor is in effect proving that you are irrelevant.  In real life, this is what so many producers bump into when they try to make a sale based on the product, rather than the problem the product was designed to solve.

The simple process to demonstrate YOUR relevance.

The graphic below shows the Circle of Relevance. Look below and see how it works.

 The Circle of Relevance.

The inner-most circle is your product.  We use variable annuities as the example here, but it could just as easily be LTC, life insurance, 401(k) or any other product.  If a variable annuity is your product, chances are slim that you will find consumers proactively looking to talk with you about them.  But, chances are pretty good that you can find people wanting to talk about  the middle circle - income solutions.  For Boomers, that's a big topic. It is a point of relevance to them, where variable annuities probably is not.

Next, look at the outer-most circle.  Virtually ever person in America has some kind of a financial problem.  From having too much cash to needing a tax-effective retirement distribution plan - every financial need falls into the "Financial Solutions" category.

Where do most producers make their presentation?  Right in the fat middle of the product.  They go for the throat.  They try to engage the prospect in a conversation about the product, rather than the next level up.  Look at the difference between these questions:

1.  Have you heard about the new generation of variable annuities?  (That's "hammer mentality.")

2.  Has your financial advisor talked to you about income solutions?  (That's a connection question.)

If you are an advisor, and want to show yourself as relevant, your job is to learn how to use the Circle of Relevance. For the client, it's not about the product - it's about the problem and the result the product brings.  And, in order to make it work, you must understand which problem he has and which result he wants. 

If you’re a wholesaler, your job is similar. You need to show that you understand your prospect’s situation - his business model, clients, corporate mandates.  Show that you are able to offer insights - then introduce relevant solutions.  Again, you need to know which problem he faces and which result he wants.   

Quick Story.  During a recent coaching call with a Canadian securities firm, I was helping a group of advisors demonstrate their relevance.  They were role playing by interviewing each other. It was very painful. These guys meant well, but had absolutely no idea of how inept they sounded to the person on the other end of the line. As bad as they were, they were very similar to most advisors and wholesalers we've met. They made the same mistakes:

Here is the biggest mistake. See if you recognize anyone:

Mistake #1. Diving into detail. This is without a doubt the biggest mistake that financial advisors make. It sounds like this, “Hello, might I interest you in a tech stock that has shown great promise for growth through market fluctuation?”  or  "Hello, how would you like to capitalize on stock market gains, while protecting against downturns?"  Those approaches are very obviously based on what that person wants to sell.  They have zero to do with the client. 

What can you do better?  Decide in advance what the goal of the call is.  I know, it sounds remedial, but most people do not do that.  So, they get nothing. 

Your Reward.  The ideas and insights in this issue of Inner Circle come from our work in the area of Professional Credibility.  This is a topic we have been exploring and working with since 1991.  Our most effective training and coaching focuses on building credibility for financial professionals.  We will soon be hosting our first teleseminar on this topic.  If you would like to gain access to it (FREE), just answer the following questions.  (Everyone else will pay $89.)  Send your answers to me at: (michael@aboutpeople.com).  Be sure to include your contact information.  Here are the questions:

1. What are your top 3 business concerns:

2. What are the top 3 things you want to accomplish:

3. Where do credibility and likeability fit into your solutions:

-  Michael Lovas

 

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