Client value proposition

Jerry Cobb:
Hi, I'm Jerry Cobb with Schwab Advisor Services. I work with some of the most successful advisory firms in the industry to help them maximize strategic growth opportunities. Now that you've had a chance to start down the path to define your firm's ideal client persona, let's talk about a tool that works in conjunction with that, your Client Value Proposition or CVP. The output of your effort on this topic is foundational to delivering a valuable client experience, which drives growth for your firm and can help you stand out in an increasingly competitive environment. During this video, I'll be referencing the CVP worksheet, which can be found in your advisor workbook. You'll want to have it in front of you so that you can follow along as we go and then complete it afterwards. By the end of this video, I hope you'll understand why having a strong Client Value Proposition is so important and that you'll be on your way to defining your firm's CVP.

Jerry Cobb:
So, let's get started. In a recent survey, 98% of advisors rated being clear on the value their firm provides clients and being able to effectively communicate that value to prospects, as important or critical to their business. A strong CVP helps you drive growth by differentiating your firm from competitors and clearly communicating what makes you the best fit for your ideal client. Now, an important aspect of any CVP is that it should be expressed from the perspective of your ideal client, using words they might use to describe what they value about working with your firm. Notice I said what your client values, not what you think you do best. It may seem like a minor distinction, but it's an important one when it comes to communicating your value. A Client Value Proposition is, in many ways, an explanation in your client's words of why they continue to work with your firm as opposed to a competitor.

Jerry Cobb:
What is it that they value? Why did they choose you? What are the things you do better than any other firm? And what's powerful is when you get to the heart of those answers, because that's what truly differentiates the experience you provide to your clients, and what sets you apart from competitors. And when you meet with prospective clients, you can paint the picture of why they'll look back in a couple of years and be grateful that they made the decision to work with you.

Jerry Cobb:
So, let's dive a little deeper and talk about how you can begin to craft your CVP. A good CVP makes both a rational and an emotional connection with the listener. It speaks to the head as well as the heart. So ideally, you want to identify how your best clients think and how they feel about the value you provide them. So take a look at the worksheet you downloaded. In step one, we're going to ask you to make three lists, Offer Attributes, Client Value, and Value Drivers.

Jerry Cobb:
Let's go through each of these one by one. First, Offer Attributes. These are the various services you offer and the way you deliver those services. These Offer Attributes, connect with your clients' heads, providing the logical and rational reasons that they work with your firm. Now, most of the firms I work with are really good at this part. Their websites are full of Offer Attributes, things like we're fee only, we're a fiduciary or we do financial planning, investment management, tax planning, charitable giving. We help with educational savings. So you begin to form your CVP by listing the services you provide in that first column of the worksheet. You'll also want to add to that column how you deliver those services. Things like regular portfolio meetings or being responsive, returning a client's call within 24 hours, maybe even offering video conferencing. So, that's the first column in step one on our worksheet.

Jerry Cobb:
Now unfortunately, many firms stop here, failing to think about, well, why does my client care that I'm a fiduciary? Or what value does my client get from my financial planning offer? Even though you know why those things are important, your clients may not make the same connection. And that's what we want to capture in the second column, the Client Value. So you need to think through how your ideal client would describe the value they derive from each of these attributes that you listed in the first column. So, let's use a fee only structure as a quick example. Your client might describe that as my advisor doesn't get paid to recommend products, so I know their advice is truly in my best interests. The term "fee only" isn't what's important to them. It's that they know your advice is fair and transparent. So, when you're finished with this video, you'll want to translate your Offer Attributes in the first column to that Client Value language in the second column.

Jerry Cobb:
And then the third and last column of step one, is to create a list of what we call Value Drivers, which capture how your ideal client feels about the value they receive from your Offer Attributes. Now here is where we engage with the heart and identify what it feels like to work with your firm. So let's go back to that "fee only" example. The associated client value was my advisor doesn't get paid to recommend products, so I know their advice is truly in my best interest and then the Value Driver, the way they feel about that, might be something like trust or confidence in you and your firm. You want to keep asking, what is my client getting out of this? And when you get to the Value Drivers, you really start to think in those emotional terms. Words that resonate with people and inspire some sort of feeling. Jargon doesn't necessarily mean anything to your clients, but feeling confident, feeling empowered, feeling safe, those are things that clients want to get from working with an advisor and they're the things they're likely to tell others as well.

Jerry Cobb:
So, when prospective clients hear those things, when they understand from their head and their heart that, that's the value they're going to get, their choice to work with you is much easier. Let's look at one more example to bring the purpose of step one to life. An advisor I worked with was very proud of the cashflow analysis he did for his clients, and he listed it as one of his Offer Attributes in column one. Now, none of his clients would use that phrase "Cash Flow Analysis" to describe why they valued working with him. No one says, "I like working with my advisor because he does his cashflow analysis." That's jargon. Instead, they're more likely to say something like, "I like working with my advisor because he shows me how to make my money last longer."

Jerry Cobb:
So, I encouraged this advisor to use that statement as the Client Value in the second column. And then the last step, how does this make the client feel? Safe, secure, confident. So we listed those feelings in the third column for Value Drivers. Now this is just one example of how to recast and restate what you do from the point of view of your client and to capture and express what he or she values about your work.

Jerry Cobb:
In addition to the work we've done thus far, a compelling CVP explains through your client's eyes, why working with you is different. So step two of the worksheet asks you to list some of the ways you're different from your competitors. Things like the type of expertise individuals in your firm have, your service model, the solutions that you provide to address different kinds of challenges, even something like community involvement. And as you walk through these different elements, you begin to create a clearer picture of why your clients work with you instead of another advisor.

Jerry Cobb:
Many firms talk about their value by promoting the same products and services using similar promises and taglines. Separating yourself from this sea of sameness by digging into the differentiators that resonate with your ideal client, will be integral to setting you apart. This brings us to the final part of the worksheet.

Jerry Cobb:
Step three is an exercise to help you summarize these elements into a concise paragraph that describes what your clients value about the work you do for them. Now, the key here is to express your value in words that would resonate with your clients and which form a statement that would speak to a potential ideal client in a compelling way. The tendency for many firms at this point, is to talk about individual products and services in isolation instead of comprehensively from their client's perspective and really capturing what they get by working with the firm.

Jerry Cobb:
Now before I let you go to get started on drafting your CVP, I want to share a couple of examples, one weak and one strong. You can also review both these examples in your workbook. Here's the first. "Our firm delivers a personal proactive wealth management service tailored to the specific needs of each individual." Now that statement is probably true, but it's typical stuff. It's devoid of emotion and it doesn't really leave clients with a specific idea of what to expect if they do business with this firm. Now contrast that statement with the value proposition like this one. "We provide customized wealth management including charitable giving expertise that helps simplify our client's complex financial lives. We understand affluent women who have been divorced or been widowed and help them regain financial independence. Many of our clients haven't managed their finances for quite a while, so we provide guidance, education, and expertise. Our clients feel informed, confident, and reassured as they enter the next phase of their lives."

Jerry Cobb:
This second example is much stronger, not simply because it's longer, but because it speaks to a real person. There's a good chance we can all see someone we might recognize in this second example. Instead of trumpeting what the firm values about itself, it conveys an understanding of what the firm's ideal client values and it makes an emotional connection. I hope the steps we've discussed today cemented with these examples, bring to life how you can grow your firm by differentiating yourself from your competitors and effectively communicating what makes you the best fit for your ideal client.

Jerry Cobb:
This extreme focus on your ideal client and what they value about working with your firm really sets the foundation for growth by helping you stand out in an increasingly competitive environment. Now it's time to get to work and begin defining in your CVP. Good luck and thanks for watching.