Remember the old joke about the devil showing a guy around Hell? There were great parties, swimming pools, and sumptuous food. The guy liked what he saw, lived a bad life and went to Hell when he died. Upon arrival the devil brought him into a world of fire and brimstone. He asked: "What happened to the place you originally showed me?" The devil replied: "Then you were a prospect, now you are a client."
It's tempting to give current clients attention when they call, when you need their signatures on a legal document, or when you try to mine them for referrals. But if that's all you do, you'll start to lose them.
Why do clients leave? Lets consider several myths about clients:
Myth #1: They know what I'm doing for them. No they don't. They pay fees, and in return they get certain services, such as tax returns. They don't know about the work you do for them in the background or the classes you attend to keep current on tax regulations.
What to do: Call periodically to touch base. Mention tax law changes, even highlighting ones that don't apply to them. This shows you're on the ball.
Myth #2: They would tell me if they were unhappy. No they won't. Most people avoid confrontation. Your job puts you in an awkward position: You tell them they must part with money immediately, for example. They might be resentful. Maybe they meet another CPA who spins a tale of how they would approach things differently, saving them money.
What to do: Solicit feedback. When Ed Koch was New York City's mayor he became famous for asking: "How am I doing?" You might periodically remind them your job is to help them to legally minimize the taxes they are required to pay, for example, and help them keep current to avoid penalties. Are they satisfied with the relationship?
Myth #3: They understand what I'm talking about. Not always. Tax law is incredibly confusing. In 2013 the U.S. tax code covered 73,954 pages, according to Wolters Kluwer CCH Standard Tax Reporter. Most people are afraid to say they don't understand something because they think they will appear stupid.
What to do: Assume they know nothing, even if they are professionals in their field. Use expressions like: "You are probably aware…" before introducing a concept.
Myth #4: They have a reasonable understanding of the system. A variety of expectations may sound rational to them. For example, they might think they can omit reporting something and get away with it, because "no one checks" or "everyone does it." Maybe they heard cocktail party conversation about how they can really, really minimize taxes. People believe what they want to believe.
What to do: In simple terms, explain the rules as if it's a game: "You are required to do (A) by (B). If you don't, here are the consequences. They will allow (X) but not (Y)…"
Myth #5: They are leaving, there's nothing I can do. There is something. Individual clients don't put out Requests for Proposals (RFPs) or announce they are considering other providers. They just say: "I'm leaving." Or simply depart without saying a word.
What to do: Face-to-face meetings carry a lot of weight. There's precedent: It's likely they are familiar with exit interviews. You might discover that they feel they aren't getting the level of attention they want. Explain what you do in the background on their behalf. Explain your respect for their time. You want to learn from this experience: How could you have made the relationship better? Suggest they remain with a trial or probationary period.
Myth #6: They will come back. Maybe, maybe not. Egos and vanity play a role. You are convinced they will suddenly treasure the great relationship they left and come back. They might discover the grass isn't greener on the other side. Actually, it's all the same grass. Their ego will keep them in place even if they are unhappy.
What to do: Call former clients after a few months. "I realize you had your reasons for leaving. You were a very important client. I'm calling to confirm that everything worked out the way you wanted." By meeting them halfway she has created a climate where they can say: "Actually, I've been meaning to call you…"
We make assumptions about clients. Often they are wrong. Everyone wants to be an important client. The personal touch makes a big difference.
About the author:
Bryce Sanders is president of Perceptive Business Solutions Inc. in New Hope, Pennsylvania. He provides HNW client acquisition training for the financial services industry. His book "Captivating the Wealthy Investor" can be found on Amazon.com.