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Empathy Can Be A Differentiator for Advisors

Clients don’t want to be sold to, they want to be understood.

The last few years have been stressful for everyone. A global pandemic, political turmoil, rampaging inflation, rapidly rising interest rates, market volatility, dire predictions about impending recessions — you’d have to be made of stone to get through all of this without at least a touch of anxiety.

The job of a financial advisor is to manage client portfolios through good times and bad. Winning and keeping your clients’ business is hard enough as it is, but assuaging concerns when the market flounders and the economic outlook darkens is exponentially harder. Rationality goes out the window, as some clients may push to liquidate their positions in knee-jerk attempts to stem the losses.

You can’t stop your clients from having emotions. Even the most grounded people can start thinking and acting irrationally when they perceive their life savings to be at risk. Trust is key — a 2019 report by Edelman found that 81% of consumers say they must feel like they can trust the businesses they engage with, even with the most cursory purchases. The good news is stressful times like these are the perfect opportunity to build trust and establish the kind of long-lasting bonds that will keep your clients in your book for years to come.

One Word: Empathy

When the market drops, inflation balloons, and many economic indicators signal an imminent recession, the last thing on the typical client’s mind is investing more money. They’re scared. They (irrationally) feel like you’re not doing what you’ve promised for them and their nest eggs. 

They don’t want to be sold to, they want to be understood.

Ask yourself this when you’re writing your next marketing email, blog, or social media post: are you advertising for your clients or at your clients?

Put yourself in your clients’ shoes. What would you want to hear from your financial advisor while your portfolio was losing value and the news kept repeating that it was going to get worse? Chances are you’d be exasperated if all they gave you were platitudes about how the market always bounces back, or if they were mostly concerned with convincing you to give them more of your money, right?

Obviously, you can’t tell your clients exactly what they want to hear — you can’t control the markets or give them free money — but you can reassure them that yes, fear is a completely normal reaction in times like these and no, they aren’t alone in feeling that way. Remind them that you’re in this together — that your portfolio is suffering, too. They need to feel that you’re just as concerned about their well-being as you are about keeping their business.

What’s in It for You

For some people, helping others is reward enough. Others go to business school.

Empathy has real benefits for the resilience and longevity of your practice. Keep in mind, it’s never been easier to self-manage a portfolio or open an account with a robo-advisor. Unless you’ve managed to develop a proprietary investing strategy that never fails to beat the market by double-digits, you need a differentiating factor if you want to continue growing your firm. But don’t worry, that “secret weapon” is not expensive or hard to find. In fact, you already have it.


A robo-advisor can’t talk clients down from a ledge when their portfolio is hurting. E*Trade isn’t going to send Christmas cards or take clients out to lunch to discuss their next moves. Your expertise is a big part of why your clients trust you, but there are plenty of talented financial advisors out there. Your clients do business with you because they trust you.

You don’t need to be buddy-buddy with your clients to keep them in your book indefinitely. All you need is to make sure they know you’re a human being who wants to see them succeed.

Rethink Your Next Marketing Campaign

Financial advisors have a lot to gain from employing empathy in their messaging. A little humanity goes a long way in helping clients calm down when the market takes a dive. Remember, you’re the biggest asset you have in the battle against robo-advisors and self-driven investment platforms. So, try to think of what your clients want and need to hear before you send out your next marketing emails. 

In times like these, clients don’t want a sales pitch, they want to be understood.

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