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Why Do Clients Forgive a Bad Quarter but Remember a Bad Phone Call?
Performance matters. Experiences linger.
The D on the Report Card
I grew up with hand-written paper report cards. Perhaps you did as well.
Let’s say this was your report card all those years ago.
Language: A
Math: A
Science: A
History: B
Social studies: D
What did Mom and Dad notice?
Of course!
But why? Why didn’t we hear, “Three A’s. Great job.”
Because the human tendency is to give disproportionate attention to what’s wrong.
Ten times in a row, your airplane lands on time. On the eleventh flight, you sit on the runway for two hours.
Which flight do you remember?
The technical name for this is negativity bias, and your clients are not immune.
You can do ten things right. You return calls promptly. You call your clients on their birthdays. You provide sound advice.
Those things are the A’s and the B’s on your report card.
Then comes the D.
A Terrific Advisor Having a Tough Morning
Here’s a hypothetical case.
The market is getting pummeled and an Advisor, Linda, spends the entire morning on the phone, call after call after call.
A client finally gets Linda on the phone, and the client is nervous.
Linda is a bit impatient. She’s been on the phone since 7:00 AM. Perhaps the impatience shows through a bit.
Linda knows the client is fine.
She explains to her that they’ve gone over this before. Linda has explained that corrections are normal and the client is well diversified.
Linda didn’t say anything wrong.
The information was correct.
But the problem is not the information.
The problem is the experience.
Being technically right doesn’t guarantee that the conversation went right.
It may very well be that the client wasn’t necessarily calling to find out whether corrections are normal. She probably already knew that.
She wasn’t asking, “Is my portfolio diversified?”
She may really have been asking, “Am I going to be okay?”
Six months later, she will not remember if her account was down 6.7% or 8.4%.
But she may remember:
“I was scared, and Linda made me feel kind of stupid for being scared.”
Why will she remember?
Because market declines aren’t personal.
Impatience is.
A client may forgive a bad quarter more easily than a bad phone call.
And here comes the report card.
Investment advice: A
Responsiveness: A
Knowledge: A
Service: B
Made me feel unimportant when I was frightened: D
Linda may think she is doing a very good job that morning.
She’s taking calls. She’s giving sound advice. She’s keeping her clients invested.
She’s a terrific Advisor having a tough morning.
Linda is trying to keep everyone calm. She’s addressed this same issue with this particular client before. And by 11:30, her patience is wearing thin.
Linda has no idea that she just got a D.
The Grade We Never See
Just like teachers, clients have a report card.
Unfortunately, we don’t get to see it.
And just like when you were a kid, how many A’s does it take to offset one D?
The A’s and B’s on your report card are seen by your clients as your basic value. They have come to expect these things.
You return calls promptly?
You are expected to.
You call your clients on their birthdays?
Nice.
You provide sound advice?
You better.
After years of good service, good service becomes invisible.
Not because your clients are ungrateful.
You have simply changed their expectations with your consistency.
When one thing goes wrong in the client’s mind, it’s visible.
Nobody notices if the lights are left on all day.
They notice when the lights are turned off.
And sometimes we respond to the words while missing the need underneath them.
Linda’s client is not going to tell her that she got a D.
She isn’t going to say, “Your response was factually accurate, but I found your lack of empathy disappointing.”
She’ll probably say, “Okay. Thanks.”
And hang up.
In this example and situations like it, you may think, Problem solved, and move on to the next call.
Your client may think, I’ll never call her when I’m scared again.
She isn’t merely evaluating what you know.
She’s remembering what it felt like to need you.
Maybe that’s worth remembering the next time the phone rings on a difficult day.