How to sell financial services to women

 I have left my old job. And as I am clearing out the trash (actually and metaphorically and doing some email archaeology) I came across old articles which I would like to put some place because I thought them interesting. And useful.

So here:

If you read “How to give financial advice to women” by Kathleen Burns Kingsbury you will be left with the irrepressible notion that women have finally arrived. For such a book to be written, delving deeply into the psychology of women and how they communicate and how they prefer to be served and sold to, one can only assume that it must finally be worth the trouble.

It is. Kingsbury prefaces the book by making the business case. She is not going to tell male (or female) financial advisors, that they’d better bone up on “attentive listening”, an art in itself, if she doesn’t have the numbers to justify the effort.

Over the next 40 years in the US, she says women are due to inherit 70% of the US$41 trillion in intergenerational wealth transfers, or approximately US$28.7 trillion in assets. And the first thing they will do when they have inherited this wealth, is fire their present advisor. Why? Because most advisors have neither taken the time to know them or to study how best to reach out/relate to them.

Men, she says, are competitive by nature. Show them a bunch of charts to prove how your investment outperforms the index and they’re happy. Whip out the same bunch of charts with a woman at the start, and you may lose her as a client.

Her definition of success is not about winning and losing against the market, but on how well her portfolio performed in conjunction with her long-term life goals and objectives. He wants to win. She wants to survive and thrive.

Recently the Boston Consulting Group surveyed 12,000 women from 21 countries for its Global Inquiry into Women and Consumerism study and discovered women are most dissatisfied with the financial services industry, of all industries, on both a service and product level.

The financial services industry, Kingsbury points out, was created by men to serve the male wealth creator; therefore it is no wonder that women feel left out. They were and still are.

Approximately 80% of financial advisors, 90% of brokers and 84% of financial corporate officers are men. The industry’s best practices, marketing strategies, selling tactics, and investing protocols were and still are developed primarily using a male’s brain which thinks, acts and behaves differently than the female’s brain.

This misconception leads advisors to miss the boat when prospecting and advising women. The traditional transaction business model commonly used in financial services does not meet a woman’s social or neurological need for connection. Instead, a woman wants an ongoing coaching relationship with her financial advisor.

“She wants a professional who understands her first and sells to her second,” Kingsbury emphasizes.

Women are looking for female-friendly advisors to help them receive, build and pass on wealth. These advisors need to be knowledgeable, credentialed and competent. They must possess communication and relationship-building skills specifically designed for working with female clients. In addition, they must understand a woman’s need to build trust slowly, to be emotionally validated by her advisor and to be able to share her story as part of the financial planning process.

Sound like a tall order? Not if you think about what you, as a financial advisor, stand to gain. Or lose. Some fun facts: Women control the majority of personal wealth in the US. They make approximately 80% of family household buying decisions, including those related to banking and financial services. Of affluent women, 88% are moderately or highly involved in the oversight and management of their assets, one in five firms with revenue of US$1 million or more is woman-owned, the economic impact from women-owned businesses is US$2.8 trillion annually.

Kingsbury goes to lengths to spell out the psychology of women, how they think, feel and operate. She even maps out the differences in how the male and female brains work. If you think about it, the discovery of the differences is pretty recent, as late as the 1980s. Before that, male and female brains were thought to operate in the same way. Just like pre-Rousseau, children were considered miniature adults and childhood was not recognised as a separate state.

At the end of each chapter, she provides, little exercises for you to assess how female-friendly your practice is, how you define wealth, how you can use/adapt your present strengths for this market.

She even provides dialogues, a kind of what to do, and what not to do. Some of the conversations may appear tedious, and overly careful and I can imagine men rolling their eyes – no, you don’t whip out a solution when she presents a problem; first you listen, then you affirm her feelings without belittling her or her concerns, and then you both put your heads together and try to figure out a solution. It takes about five times longer than dealing with a man. And she is very detail-oriented. A desk without photographs, for instance, may raise eyebrows because it stays something about you.

When I shared ideas from this book with my colleagues, most of them said women here (in Malaysia) want to be treated the same as men. They want the charts, the “let’s not waste time making small talk but get on with it” attitude, but I wondered, for how much longer.

If men and women relate differently naturally and as women become more economically empowered, they will start asking for services that are skewed towards their natural predilections. And as Kingsbury says, don’t make the mistake of thinking that packaging will do the trick.

What are the rules for navigating the female world? They are many and complicated. But Kingsbury gives you six.

Firstly, women need to tell their story. If you want her as a client, you are going to have to learn to listen, ask curious, open-ended questions. Second, women tend to get personal quickly. Three, women communicate using feeling words. (“She will do most of the talking and emoting; you just need to listen, validate her feelings and show empathy.”) Women define success as being “indispensable”. They love to help and be seen as the go-to person for assistance. Men typically prefer to be independent and define success in terms of doing it alone.

The fifth rule is that women tend to remember details and read body language. Making eye contact, communicating interest through nonverbal communication and paying attention to details are very important in the female culture.  And finally, the last rule is that women are loyal. If you have secured her as a client, she is likely to not only stay with you, but refer you to more friends, family members and colleagues than your male clients.

The second half of the book takes you through actual conversations and exercises. If you don’t think the female market is worth your while, here’s where you would stop reading. But if you are looking to capture this not-so-niche market, you would probably do well to study this book carefully, read it several times, take notes.

Oh yes, and for crying out loud, put some photographs on your desk.