Putting Empathy on the Map

Cropped Map

by George Ray

As we get closer to Christmas, we’re naturally thinking about what we’re going to give the people who are on our Christmas list.  We typically go through a process that attempts to help us by asking ourselves “What would my brother like for Christmas?” or “What would my 12-year old nephew want?” To accomplish this (and to come up with the perfect gift), we practice ‘empathy’.  Merriam Webster defines empathy as ‘the action of understanding, being aware of, being sensitive to, and vicariously experiencing the feelings, thoughts, and experience of another of either the past or present without having the feelings, thoughts, and experience fully communicated in an objectively explicit manner’. In other words, when we ask those questions, we try to place ourselves in the mindset of the person who will be receiving our gift.  By doing so, we hope to give them something that they will value, appreciate, or enjoy.

Empathy is an important concept when it comes to your business. As you think about your goals and objectives for the new year, now may be the perfect time to practice empathy with regards to your clients, and prospects.  The idea is to project yourself into your clients’ experience with you, your firm, and staff in order to gain a deeper level of understanding of your client — by placing yourself ‘in their shoes’.

To accomplish this you can use something called an Empathy Map that was developed by David Gray and his visual thinking company, XPLANE. The map is described in his book Gamestorming – A Playbook for Innovators, Rulebreakers, and Changemakers. Its use for businesses is also discussed in Business Model Generation by Alex Osterwalder and Yves Pigneur where it’s referred to as a ‘really simple customer profiler’. Osterwalder says that ‘it allows you to devise a stronger business model, because a customer profile guides the design of better value propositions, more convenient ways to reach customers, and more appropriate Customer Relationships. Ultimately it allows you to better understand what a customer is truly willing to pay for.’

Your use of the Empathy Map should include a visual representation of your ideal customer in the center. Around the customer are six areas that will help you to brainstorm the needs of your customer by ‘empathizing’ with them about their needs and desires. The map helps to get the process out of your head (where it usually stays when thinking about buying Christmas gifts for your family) and onto paper (where it will do you and your staff a lot more good). To help you, I’ve created a map that you can print and use for this exercise.  Empathy Map TBoFA 121113. (You’ll also find other examples by doing an online search.)Empathy Map TBoFA 121113

It’s wise to start with some basic demographic characteristics such as income, marital status, education, portfolio size, etc.  Much of this information can be found with a little digging through your CRM, financial planning software, and asset management reports. After pulling together a basic ‘objective’ profile of your typical client, the true value comes from ‘getting inside his head’ (developing a ‘subjective’ profile).  You’ll then want to ask the six following questions (which can be recorded in each of the six areas on the map):

1.    What does my client see? His environment. What does it look like? Who is around him? Who are his friends? What types of offers is he exposed to?
2.    What does my client say and do? Imagine what he could be telling others. What is his attitude? Are there conflicts between what he says and what he does?
3.    What does my client hear? What does his spouse say? His friends? Who really influences him? Which media channels are influential?
4.    What does my client think and feel? What goes on in his mind? What is really important to him? What are his emotions? What moves him? What keeps him up at night? What are his dreams and aspirations?
5.    What is my client’s pain? Biggest frustrations. What obstacles stand between him and what he wants to achieve? What risks might he fear taking?
6.    What does my client gain? What does he truly want to achieve? How does he measure success? What are strategies that he might use to achieve his objectives?

The goal of producing an Empathy Map is to create a customer viewpoint for continuously questioning your business model assumptions.  Understanding your customers’ needs and desires will enable you to better determine if you have the right Value Proposition for your business. It will help you determine if your customer will be willing to pay you for this value. And, it may help you determine how to better reach new customers who have the needs and mindset that match your Value Proposition. The point is to truly understand and empathize with their situation so you can design and provide a better product or service — as well as create deeper relationships with your clients.

So, what does your client want for Christmas? The same thing we’re all are interested in — your empathy.

Position Yourself for Success

chess positioning

by George Ray

Have you ever had an opportunity to introduce yourself to a potential client (maybe the big one that you’ve been waiting for years to land)  — and blown it?

I’ve talked previously about the importance of having a value proposition that resonates with your customer segments. But before you even have the chance to explain all the value that you could offer this potential client in your new relationship, you must position yourself to have a meaningful conversation with him.  Your positioning statement (the modern version of the old elevator speech) is essential.  Without one, you may never get to the point of being able to show your value.

In workshops that I’ve conducted with advisers on this subject, its unfortunate how many advisers believe that they have a great positioning statement, but don’t.  In reality, most are poorly formed and/or poorly executed. I even had one adviser, during a role play, begin by asking how much money I make.  When I told him that he doesn’t have the right to ask that question to someone he’d just met, he was flummoxed. (I’ve always wanted to use that word in a blog post.)

Poor positioning statements are filled with jargon like “I’m a fiduciary” (What’s that? Sounds boring. I’ve got to go now.) or contain irrelevant information like “I have a Series 7 and Series 63”.  (Who cares? Can you help me figure out how much I need to retire?). Poor positioning statements are dangerous – they can kill the start of almost any conversation.

I’ve heard lots of excuses reasons that an adviser can’t (or won’t) build a solid positioning statement. They say ‘George, you just can’t condense how great I am and all that I do into 30 seconds.’  (I say watch any Apple commercial on TV.  They know how to do it.) I’ve also heard ‘I don’t want to sound canned or phony with a rehearsed elevator speech.” (When well-rehearsed, you will sound natural.  Think about actors in a play.  They know their lines and how best to deliver them BECAUSE they are well-rehearsed.) Another version of this is ‘I may need different versions depending upon who I’m talking to, so I just play it by ear.’ (The best jazz musicians can ‘play it by ear’ because they have mastered the melody, chords, and rhythm of a song.  That allows them to easily improvise. You need to master your basic positioning statement before you’re good enough to start improving.)

The real problem, which needs to be tackled first, leads us back to the value proposition.  A great positioning statement forces advisers to identify and articulate their value.  You must first have a clear value proposition.  That’s hard.  It takes work. It requires knowing who your customers are and what they want (which could lead us into a discussion on another adviser challenge – creating an ideal client profile.)

So, what’s the solution? Firstly, understand that your positioning statement and value proposition are very different.  The positioning statement has only one purpose — to open up a conversation with someone you’ve just met who at some point likely says ‘So, what do you do?’  How you answer that question will determine whether he will permit you to continue.  You’ve only got about 8 seconds to get his interest (i.e., the attention span of the average adult) and you should probably know that there is a woman in a slinky red dress at the bar that he can see behind you over your shoulder – so you may only have about 4 seconds.

The best way I’ve found to create an effective positioning statement is by combining these three building blocks. If done correctly, you will accomplish your goal of opening a conversation with someone. (After that, it’s up to you where you want to take it.)  To start . .

1. Provide an example of a problem that most of your clients encounter. You can do this (after the ‘So, what do you do?) by starting with “You know how . . . “ and then use an example of a problem that you can solve. For example, ‘you know how people have trouble saving money for retirement’ or ‘you know how people can’t figure out how much they’ll need to send their kids to college’. More common and broader problems can be used when you don’t know much about who you’re talking to, but if you’re at a cocktail party with a roomful of executives from Big Local Company, Inc. then improvise (you well-rehearsed jazzman, you) by saying ‘you know how executives with stock option plans can’t decide when they should exercise their options’. (As the stock option-rich executive shakes his head and says ‘Yes, I certainly do’.)   And, then . .

2. Explain how you solve that problem. You can do this by starting with ‘Well, what I do is . . . ‘ and then tell him exactly what you do to help someone with that problem.  So, let’s carry through our last example — ‘You know how executives with stock option plans can’t decide when they should exercise their options?’ “Why, yes, I certainly do because I have that problem.” ‘Well, what I do is create customized models for my clients that illustrate all of the possible scenarios to give us the best information to make a decision on when to execute those options.’ “Wow. That’s exactly what I need. Are you accepting new clients?” Isn’t that a much better positioning statement? It got you into a meaningful conversation (and he also lost track of the slinky red dress). But you can’t stop there. Next . .

3. Tell him why this is important to him. Don’t just tell him that you can solve the problem. You must finish with emotion. Finish with the feeling that he will get when you have solved the problem for him. Tell him WHY you do what you do.  “I do this BECAUSE making these important decisions on how best to exercise stock options relieves my clients of the stress of having too many of their eggs in one basket, and often we can even find a little extra for them to treat their family to a great vacation”. “Where have you been all my life? Please help me. I want to feel like that too.”

I’ve found that using these three building blocks can be the most effective way to create a positioning statement that will open conversations.  Here, let’s see if it works.  You know how financial advisers often have trouble introducing themselves to new potential clients? Well, what I do is provide them with the building blocks to build an effective positioning statement. Because when I do, they’re able to gain many new clients and build a more successful practice by simply knowing how to effectively answer the question ‘So, what do you do?

Are You a Pain Reliever?

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by George Ray

I was recently stung by a bee in my backyard (one of the most painful places on the body to be stung). I’ve been taking some pain relievers to lessen the discomfort, and it got me thinking about how financial advisers can provide pain relief to their clients.  In fact, I believe that there are two primary ways that we provide value to our clients — by creating gains and relieving pains.

In my last post, we briefly looked at the need for financial advisers to continue to innovate and adapt their business models in order to avoid being disrupted — or wind up like Blockbuster, Kodak, or Blackberry (maybe soon). I’m a big advocate of completing an annual SWOT analysis (and have lead adviser workshops on the subject) so that advisers can examine their current strengths, weaknesses, opportunities, and threats (SWOTs).  This can be one of the most effective ways to build (and update) your business plan for the coming year (if done correctly). And although the SWOT analysis can be effective, I believe that we now have a need (because changes are occurring so rapidly) to actually take a step back even further by re-examining our business models much more frequently.

One of the key business model building blocks is your value propositionIt must describe how your firm’s products and services create value for your clients. If you can’t clearly show a potential or existing client how you can create value for him, you really have no business talking to the client. Most advisers think about creating value by creating gains for the client (and I’m not just talking about investment gains). We often suggest that we provide better service (although we have difficulty defining what that means exactly). We might focus on the array of solutions that we have available. Or how long we’ve been in business. Or how many credentials we have after our names.

But your value proposition isn’t about you.  It should be focused on your clients. And your clients often have pains — financial pains. You can differentiate your business from other advisers by letting clients know that you can be a pain reliever. In fact, here are some questions to ask yourself about the pain relief ability of your value proposition:

  • Can you make your customers feel better by killing frustrations or annoyances that give them a headache?
  • Can you fix an underperforming solution from a competitor by offering better performance, higher quality, or new features?
  • Can you relieve the pain of difficulties and challenges that your customers encounter by making things easier or helping them get things done?
  • Can you help your clients sleep better by diminishing their concerns or eliminating worries about their finances?
  • Can you limit or eliminate the conditions that develop from common mistakes that clients often make?
  • Can you break down barriers that are keeping your client from adopting better solutions?

Take some time to think about your ability to be a pain reliever for your clients. Consider all of the things that you do to help them to improve their financial wellness, and help them avoid getting stung in the backyard.  It really hurts.