The information sources that persuade clients

In last Monday's article, I made the case that today's investors want more frequent, shorter contact. That means advisors should schedule regular short telephone meetings with their most important clients - say once a quarter for top clients.

But for many investors that's still not enough - some are looking to have that contact supplemented on a regular basis with a relevant article speaking to important market developments

Notice that we're talking article, not articles - in a less is more world, many clients are looking for advisors to screen down the content they receive.

And we're talking about relevant - something that speaks to what's happening today, not generic content that could be sent anytime.

We're also talking regular frequency - many investors are looking for monthly updates between personal communication with their advisor.

Even if you deliver on all that - one relevant article each month, there's one final factor for your communication to be well received - and that's for it to come from a credible source.

The role of third party sources  

We all recognize that we live in an age of scepticism - when it comes to advice from central bankers, doctors or financial advisors, to name just three examples, compared to past periods consumers are much less prone to accept what they're told without question.

That means that we need to borrow credibility wherever we can. Every advisor recognizes that the right article can be a powerful force in reinforcing your advice - that's why articles featuring bullish pronouncements from Warren Buffett ricochet around the internet at warp speed.

The reason for this isn't the content of the articles, but rather the source - it's because of the credibility of anything that Buffett says. In fact, a strong case can be made that Warren Buffett has assumed the role that news anchor Walter Cronkite occupied in the 1960s as "the most trusted man in America."

The credibility hierarchy for information sources

Accepting that the sources of information that we send clients can be as important as the content has significant implications. In fact research with investors demonstrates a clear hierarchy in terms of the credibility that clients ascribe to different information sources, with four tiers of credibility.

Tier One credibility sources are the leading financial and business publications - examples would be the Wall Street Journal, the Economist, Financial Times, Forbes, Fortune and Bloomberg Business Week. Even though it's not a financial publication for many investors the New York Times would be in this category.

Tier Two credibility sources are general news publications - Time, Newsweek, US News and World Report. Even though not specialized on financial issues, especially for older investors, these bring considerable name recognition and credibility.

The third tier are local newspapers; this would also include Canadian news publications such as Macleans. Fairly or not, many investors take the view that they look to their advisors for content that they would have difficulty accessing on their own.

The bottom tier of credibility are publications from product suppliers and internal firm publications. Unfortunately, today's investors are quick to see ulterior motives - many are sceptical about anything that comes from product suppliers or the firms their advisors work for. The sole exception would be those cases where firms employ an economist or market strategist who has built visibility and expert credentials in the broad media.

The bottom line is crystal clear - the same article will have a dramatically different impact depending on its source. An email link to an article in Fortune or Forbes will resonate in a fundamentally different way than if that link is to the same article in the local paper.

As you think about how you communicate going forward, keep those four elements in mind - in future, successful communication will be defined by more frequent, shorter, relevant and credible contact.