In the race to appeal to the most potential clients, many advisors in the financial space are "proving their worth" by increasing their offerings. While the bells and whistles may be exciting, overloading your clients with options may also be costing your advisory firm business.
Decision fatigue, or the emotional strain that comes from making too many decisions, is a real condition.
Columbia University's research project demonstrates this principle, as cited in optimizely.com's article; "When 6 flavors of jam were available, 30% of those who tasted samples made a purchase. When 24 flavors of jam samples were made available to shoppers, only 3% who tasted the jam samples went on to make a purchase."
To avoid unnecessary decision fatigue, thought leaders such as Mark Zuckerberg and Steve Jobs chose to preserve their energy for the most important tasks by wearing the same shirt every day, according to Eugene Kim's businessinsider.com article.
For the companies and employees trying to navigate the retirement landscape, your job as a financial advisor is to help them to create the best-fit vehicle for their investments.
Whether it is navigating your firm's website or an in-person consultation, offerings should be clearly discernable and limited to the most essential. This may not mean reducing your complete offerings package but limiting what you show to clients based upon their individual needs.
During the sales meeting, listening to your client's needs and then offering a few, best-fit options can show them that you are listening and reduce unnecessary decision fatigue.
If you want to offer multiple solutions on your website, let the navigation segment your offerings to bring clients to their best-fit solutions. Optimizely.com's article recommends considering the client journey through your website. Make the path clear and easy to navigate. Utilizing clear call to actions can also help to boost conversions by outlining the next step in the buyer's journey.
Auto-enrollment is a very simple, yet effective example of simplifying the decision-making process with positive results. According to money.com, "Merrill found that plans with auto enrollment had 32% more participants, and those with an auto escalation feature had 46% more participants increasing their contributions."
Are there other "features" that you could "auto-enroll" your clients in?
Marketwatch.com reminds us that the time of day can play as much a role in decision making as anything else; "Now, a new study reveals how this phenomenon [decision fatigue] can affect our financial lives. In it, the authors discovered that participants who engaged in challenging cognitive tasks experienced mental fatigue that ‘enhanced the propensity to make impulsive [economic] choices [and] favor immediate rewards.'"
Have you noticed timing trends in sales? This may be as simple as the time of day that you schedule your meetings or send important emails. If you've had a difficult discussion, it may be best to let your prospect/client recharge before starting again.
These are just a few examples of how your presentation and timing of important information can impact the success of your sales efforts.
According to Aamina Zafar's article in ftadvisor.com which cited research completed by Scottish Widows, a shocking "6.4m people said they did not have time to do important life admin...When asked for the reason why, 19 per cent confessed they were put off financial admin because it was too time-consuming, while 17 per cent claim it is too stressful."
Decision fatigue has been impacting your sales with prospective clients for your entire career. Learning to work within its constraints to increase conversions can improve the efficiency of your sales routine and client relations.