Why Do Clients Come Back?
The reason surely isn’t the investment returns you bust your can to produce. It isn’t your spiffy college education, your crazy wow-factor master’s degree, or your prestigious alma mater. It isn’t your over-the-top, no-holds-barred, insanely expensive annual client appreciation event. It isn’t your penetrating insight into the financial markets or your utterly remarkable financial planning expertise. It isn’t your crack administrative staff. It’s not even your extensive list of licenses, professional designations, or other industry credentials (Sorry, I know you’re proud of all those.). Public speaking skills? Office location? Cool business card logo? Nope, nope, nope! (drum roll, please) It’s the relationships you’ve built.
Eating at Fred’s
I have been dining at Fred’s Italian Corner for 25 years. I live in the Houston suburbs, and Fred’s is 40 minutes one-way across town through the busiest 3 miles of Texas interstate, deep in the famed Houston Medical Center. My family eats there once or twice a week. I first started eating at Fred’s in the 1990s when my cousin, Eddie, had leukemia and needed regular blood transfusions at nearby M. D. Anderson Cancer Center. I’d donate some blood, then stop in at Fred’s for a hot plate of steaming Sicilian spaghetti and meatballs. I grew to love Fred, the slender, quirky, Sicilian owner of Armenian extract, who’d sit behind the register, taking orders with his skinny, and ridiculously tall chef’s hat, chatting up the customers and barking orders over his shoulder to his kitchen staff, who, in his opinion, were imbeciles, and never seemed to get anything right. He always had a big smile and wanted to know what was going on with you. After 10 years, he died of cancer. I was stressed. Not only had a lost a friend, but I feared for the restaurant’s future. The place had become my own personal kitchen. Everything was just so, and nothing ever changed.
His son, Andy, took over for a while, but I was worried it would fail. I resented his son’s presumption to take over “my” restaurant. Andy knew I was uneasy about his taking over, but he persevered. He’d come by our table and make small talk every time we came in. I got to where I’d call down to the restaurant on the way there, and he’d take the family’s whole order over the phone. When we arrived, our table was ready and the food was promptly delivered. When Andy was thinking up a new dish for the menu (he liked to tinker with the sauces and this annoyed me beyond reason), he would whip one up for us on the house, and then ask for our honest opinions. He eventually won us over.
One day, we came into the restaurant and saw some new faces behind the counter. Andy explained that he had decided to sell the business, and to foreigners at that! I was miffed. Not only were they not Sicilians, or even Italians, they were Iranians. The first thing they did was install a TV in the restaurant. Can you believe that? I was disgusted. For several months I was leery and very stand-offish with the new owners, not giving them the time of day. I would ask for my favorite (pre-ownership change) waitress and just ignore the new owners. But, they kept coming to the table, visit after visit, always smiling goofily and lavishing upon my family a gross amount of warm, personal attention (A gross amount, I tell you!). They kept piling on, first one family member, and then another. We got to know all their names, and they finally pierced my armor. I call the old man “Papa” now. His son, Amir, recognizes my voice when I call ahead with my order, and he doesn’t even ask if it’s me. He just says “Hey, buddy! What would you like tonight?” To tell you the truth, the food isn’t even that good anymore. But, where else can I go and feel like I am in my own kitchen and among my own friends, EVERY SINGLE TIME?
The Morals of the Story
It should be obvious from my experiences at Fred’s over the years that building good relationships is essential to building good businesses. But, I’d like to draw out two additional morals from these experiences. The success of both Andy and Amir in working hard at winning my friendship ensured that I’d be a longtime customer of the restaurant, even through ownership changes, a decline in the food quality, and a host of other things got under my skin.
Moral #1: If you decide to pass along some of your B and C clients to an associate advisor, the associate advisor’s top priority will be to focus on building a quality personal relationship with each client before trying to do any significant business. This is the best way to ensure the relationship stays in the house, so to speak. People usually hate change. A change in advisor can be devastating for a client. The only thing the new advisor should be in a hurry about is making friends.
Moral #2: Relationships trump everything else. Great relationships will endure poor service, long lobby wait times, and lousy investment performance because they are rooted in love. We all need this reminder: “Love is patient, love is kind and is not jealous; love does not brag and is not arrogant, does not act unbecomingly; it does not seek its own, is not provoked, does not take into account a wrong suffered, does not rejoice in unrighteousness, but rejoices with the truth; bears all things, believes all things, hopes all things, endures all things. Love never fails.” – 1 Corinthians 13:4-8 Build great relationships on the foundation of love and they will endure the test of time.