In 2012, the Corporate Executive Board performed a study to determine just how much buyer behaviour was affected by digital media. As it turns out, 60% of the sales cycle is completed before a buyer makes first contact with a sales person. What’s happening in that 60%?
Any good buying decision must first start with research. The proliferation of digital media has made content so readily accessible that it’s now possible to do most of your due diligence online without the need to speak to someone to make a buying decision. So, why should you care as an advisor? Well, have you ever walked into a meeting with a client and been put on the spot because your client read something online, pertinent to your business, and spent time trying to correct the conclusion they came to by reading that article? Buyers are becoming more knowledgeable and it’s re-shaping the role of sales and marketing professionals. Understanding the buyer journey can help you adapt to these changes.
So, just what is the Buyer Journey? A buyer journey consists of the mental stages a buyer experiences before making the purchase of a product or a service. In the financial or insurance advice space, this could be a mutual fund, a specific investment strategy, life insurance premium amounts and so on. There are 3 key stages: Awareness, Consideration and Decision. Let’s take a look at each one:
This stage isn’t about the awareness of your product or service. The title refers to the awareness of a problem that your buyer is experiencing. For example, let’s say you notice your child’s temperature is very high and experiencing severe stomach pain or, perhaps your client is noticing that their RRSPs aren’t growing at market rates. Buyers in this stage are identifying symptoms of a problem. They don’t know specifically what the problem might be but the symptoms are mentally or physically uncomfortable enough such that it compels them to “figure out” just what is happening.
In the consideration phase, the buyer is taking the inputs (i.e. the symptoms) and attempting to identify the problem. In the example above, you might go to a doctor or perhaps read some information online (or offline) and come to the conclusion that your child has the stomach flu. Your client with poor RRSP performance, could take a look at their RRSP portfolio, and identify the fact that one of the funds they’ve invested in is performing poorly and negating the gains of the other investments. A buyer will not move onto the next stage until they’ve gathered enough information and identified the specific problem.
As you might guess, the decision stage is the point at which a buyer gathers information to make a decision to select the best possible strategy or solution to their problem. Basically, they’re comparing different solutions. Having identified that your child has stomach flu, you’re next likely behaviour would be to try to find solutions that help relieve the symptoms of the virus (or, if you haven’t seen a doctor yet, going to see a doctor could also be an option). The most likely scenario with your client would, for example, involve selling that fund and either re-investing their savings it into an existing fund or perhaps investing the savings into a brand new fund or perhaps GIC. Buyers in this stage are collecting alternatives and options that they can choose from to solve their problem and will move onto the final stage which involves the purchase decision.
A good understanding of your buyer’s journey can help you adapt to the changing buyer and help increase the trust you have with clients. Increasing the trust you have with clients creates leads, opportunities and incremental revenue.
What would your buyer’s journey look like? How can you create content to follow that buyer’s journey? Stay tuned for Part 2 which will focus on leveraging the buyer journey to increase your AUM.