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Friday, September 19, 2008

How Financial Advisors use Mob Psychology to Get Clients

We’ve all heard of “mob” lynchings and “mob” psychology. These terms describe the behavior of crowds because crowd behavior is distinctly different than the additive behavior of the individuals. You can use this difference to get clients. Specifically, the fact that people are followers and a few leaders can influence them, allows you to build your business faster.
Psychologists more informally term mob psychology, “crowd theory.” Here’s how one writer describes it:

Crowds do not respond to information in the same way as individuals. Communication with respect to crowds is primitive compared to that between individuals. One can even postulate an inverse correlation between the intellectual level of communication taking place within a group and the size of the group—the bigger the group the lower the intellectual level of communication…..Crowds have very small attention spans and memories, therefore, constant repetition is necessary in order to pound the message into the collective psyche. Yet another powerful technique used in order to persuade the masses is the coupling of an image to the message. Coupling an image to the message allows further simplification of the message, while simultaneously reinforcing the sentiment underlying the message itself.

There is actually a science, using the above principals, of how to make presentations that insight mob behavior and you can apply this science to get clients. It’s called “platform sales” and you may recognize some of the most able names at this practice—Ron LeGrand, Dan Kennedy, Chet Holmes. These people get a crowd together at a conference and get the attendees so foamed up, they rush to the back of the room, credit cards in hand, to buy tapes and books and manuals by the hundreds. In your case, you don’t want to sell tapes and books, you want to get clients, you want the attendees to set an appointment to meet with you individually and eventually give you their money.

Now before I continue, there is at least one reader that must be addressed that feels getting a crowd “foamed up” is a bad thing and has no place in proper business procedures. Let's address that. Franklin Roosevelt needed to get Americans foamed up at the start of World War II which is why you now have the freedom to read this or whatever you choose to read. So the knowledge of crowd theory can be used, like anything, for positive or negative purposes. In this context, this education is offered to financial advisors who have the intention of getting clients AND serving as many people as possible and want every available tool to do so.

In our writer’s description above, he mentions four issues which have direct impact for financial advisors who want to get clients:

1. The larger the group, the less individual thinking occurs. In other words, you get more people acting as followers in a seminar of 50 people than in a seminar with 8 attendees. I have personally noticed that like many natural phenomena, there are diminishing returns. Once the crowd gets beyond 70 people, you begin to lose influence as additional attendees are physically further and further away from you and less influenced and the ability to get clients diminishes.

2. Constant repetition. Take a lesson from infomercial producers. In a thirty-minute show, they say the same things four times. In fact, it’s actually 7 minutes of tape that gets replayed four times in various orders. The lesson for you? If you want to get clients, don’t give so much information when you give a talk as people get overloaded. Pick three “themes” and repeat them.

3. Use images. That does not mean PowerPoint necessarily, but it means that you should have something that will burn a picture in the crowd’s mind. This could be a magic trick, you playing a humorous song on your guitar that you composed about insurance companies, a cartoon, etc.

4. Use sentiment. People buy emotionally and justify rationally. So why are your presentations so darn rational and logical? Logic does not move people to action, emotions do. If you want to get clients, fill your presentations with emotional reasons to act (love of family, fear of being destitute, physical discomfort in the Medicaid ward, the joy of taking the grandkids on the Disney Cruise, etc).

Seminars of course, allow you to influence people as a group rather than one to one. Not only do seminars allow you to make a presentation to many people simultaneously and thereby gain time efficiency, when most attendees laugh at a joke, so do the others (even if they don’t get it). And when followers see others nod in agreement with your point, they also agree. And most importantly, when they see others set an appointment at the seminar, they do also. Therefore, you gain an advantage working with groups that you cannot gain when communicating with individuals.

Group presentations can take several forms

The public seminar is the most common for financial advisors and the most lucrative way to get clients. People receive an invitation and attend because they have interest. With a full room, crowd theory takes hold to your advantage. By having an appointment-setting process where every attendee can observe the others making an appointment, your appointment ratio can often double because of the herd psychology of crowds.

Similar to the public seminar, is the private seminar—where the group is already gathered and affiliated—e.g. Rotary meeting, church group meeting, etc. While crowd psychology will operate in this venue, remember that the attendees did not choose to hear you speak. They simply attend their group meeting on the 3rd Tuesday each month and today, you happen to be the presenter. So don’t expect the same results in gaining clients like you obtain at a public seminar where attendees come specifically for your talk.

What about a more informal setting—like an afternoon tea for eight at a client’s home? You not only gain the momentum of the mob (albeit a small mob), you also gain the tacit (or explicit) endorsement of your host. And we know that referrals, recommendations and testimonials are important because people like to follow others and get comfort in doing so. Referrals are also the easiest way to get clients. So make sure to give your host an introduction to read or speech that is in fact a testimonial or endorsement for you. (The same technique can be used at a public seminar. Have a client introduce you and tell how you changed his life and let him know its okay to get emotional).

Your next step? If you don’t speak to groups, learn to so. Join toastmasters and get a speech coach (call your local National Speakers Association chapter for a recommendation). Pull out your normal presentation and determine how you can incorporate the elements of crowd theory to improve your results and get clients.

Post provided by Javelin Marketing