Critics of the financial services industry (often with good reason) frequently remind consumers that financial products are typically “sold” rather than “bought” and implore them not to fall into that trap. The concept here is that financial products are “sold” — pushed upon a consuming public that doesn’t understand them or perhaps even want or need them. Instead, the alleged basis for their continued vibrancy and ongoing sales is that advisors get paid big bucks to sell them.
As I have argued before, it is imperative for consumers to remember the interests of advisors they may be working with and — carefully!— to check their work and analysis. We tend to think of the sales process as about convincing or even pressuring a mark into buying what they don’t want or need. Too often it is that. Far too many advisors do not look out for their clients’ best interests and all of them have an interest in gathering and gaining new clients. But the idea that because people don’t naturally flock to buy something on their own means that it’s dangerous and bad simply doesn’t hold up.
What is good for you and things that have enduring and intrinsic value are sometimes a tough sell. But they are still good and good for you. On the other hand, we often crave what’s bad for us. Parents have a tough time selling healthy food to their kids (and a tough time following their own advice). Local symphonies are struggling to stay afloat while Justin Beiber could support several many times over. And porn is a multi-billion dollar business. Sometimes the stuff we want would be better avoided and the really good stuff needs to be sold. If you don’t believe me, will you believe Steve Jobs?
“A lot of times, people don’t know what they want until you show it to them.”
This doesn’t mean, of course, that businesses should not listen to their customers or that advisors should not listen to their clients. In the financial world, not listening to clients is a huge problem. Too much financial “advice” is about pitching what the salesman wants to sell rather than listening for and to a client’s dreams, aspirations, goals, circumstances and problems and then going about creating a way to get where they want and/or need to go. Sometimes that advice won’t be what the client wants to hear. Sometimes it will include an approach that the client had never considered. Sometimes it will need to be sold.
Ultimately, a financial advisor’s job is to provide clients what they need — not just what they want. There are plenty of “advisors” who will give their clients what they want. Sometimes doing what’s best for them — providing them with what they truly need — takes a great sales job (and that’s not a bad thing at all).