As selling becomes less transactional and more consultative, customer relationships become more valuable than features and benefits. According to Financial Advisor, Michael Merlin, when you’re managing relationships, the best way to add value is to have values.
Michael is a Managing Director with the Atlanta-based Hansberger & Merlin at Morgan Stanley,. Michael joined Morgan Stanley in 1998, just a year out of Northwestern University where he earned a bachelor’s degree in economics. In 2009, he became an Advisor in Morgan Stanley’s Family Office, a practice that provides customized services to high net-worth individuals. “Our goal is for our clients and their future generations to enjoy their wealth without worry,” says Michael. “Our consultative approach means we seek to understand your vision, your preferences and your unique circumstances before we formulate the wealth strategy that helps meet your needs.” And he’s got the track record to show it: In 2012 and 2013, Michael was listed among Barron’s top 1,000 advisors in America. He was also recently named one of America’s top advisors under 40 in On Wall Street magazine.*
In a far-ranging conversation, Michael spoke not only about sales, but also about some of the personal values and best practices from outside of sales that can have a powerful, long-term influence on the art and science of selling.
1. Be well rounded
“Be well versed and well read on a myriad of topics,” Michael says, noting that he brings home reams of reading material every weekend – not just about his industry, but his clients’ industries. Had he known what he was going to do in his career, he says he’d have been more of a generalist in college. “I’d have studied more philosophy and psychology, not just finance.” After all, since relationship managers deal with people from multiple industries, they should be well read enough to know how those industries work so they can ask intelligent questions. Being in money management means you need to know how the world works, not just investing. He says, “I’ll be reading something that wasn’t for investment purposes, an interview in The Economist, for example, and it will tip me off to a trend or an opportunity.”
2. Have an opinion, even if it doesn’t square with the client’s opinion
“Clients respect you when you have an opinion,” says Michael. “And that opinion doesn’t have to be the same as theirs.” While it may be tempting to appease a client by conveniently aligning your point of view with his or hers, in the long run you will be better off if you express the way you actually feel. “We had a new prospect come in, he was really excited, but then he changed his mind and said he was not coming back,” Michael recalls. It turned out that the client didn’t like some of Michael’s advice. Michael called him and explained, “At an earlier point in my career, I wouldn’t have told you this, but it’s what you should do. It’s the best advice.” The prospect listened – and he became a client of the firm, because he respected Michael for standing by his point of view. Opinions aren’t written in stone, of course. They may change from time to time for the right reasons, such as when new information arises, but not to win a client’s favor.
3. Get involved in your community
“Have a value proposition outside of the business context,” Michael advises. “Have good values and show them. People care about that. Regardless of what you are selling, sales is about relationships, not just transactions. Community involvement helps make you a well-rounded individual – and that’s always good for sales. Michael served as the Southeast Regional Board Chair of the Anti-Defamation League in 2012 and 2013. He also sits on the Board of Directors of several non-profit organizations, including The Atlanta Symphony Orchestra.
4. Learn from failure
“My first year in the business was 1998,” says Michael. After experiencing the final year and a half of the markets going up, they stalled. “Then I had a 10 year period that was the worst in 167 years!” The most valuable thing to Michael is the deep relationships he has with his clients – and, ironically, he says he could not have developed such relationships had he gotten into the business at any other time. “After 9/11, then the first recession, then the financial crisis, if your relationships weren’t strong, you could not survive.” Compounding the financial challenges, Michael’s partner retired in 2008. And yet, he says, the team retained the vast majority of its clients. Michael learned two valuable lessons: To focus on the relationships and to concentrate even more on customization and transparency on the advisory and money management side. Even for the highest net worth individuals, investing does not have to be complicated. The ownership of a great business is the best way to grow and retain wealth.
Good values add real value
As our conversation drew to a close, Michael was reminded of the first client he ever pitched – a young man who had been referred by another client. “He explained that he had a small amount of money – a couple hundred thousand.” But Michael took the meeting seriously, spending about two hours answering the young man’s questions. “He called the next day and told me that I’d passed the test. He actually had a couple million dollars, and he’d wanted to be sure I was the right guy.” The client liked that Michael had taken his time and treated him like the high net-worth client he actually was. “It doesn’t matter what you are selling,” he says. “This is the level of integrity that people notice and respect.” Bottom line: Good values are good for sales.
On Wall Street’s Top 40 Under 40 asks brokerage firms to nominate their top young brokers. Of those nominated, On Wall Street bases its rankings on quantitative and qualitative criteria. FAs are ranked by their annual trailing-12 month production (as of Sept 30, 2014), The rating is not indicative of the advisor’s future performance. Neither Morgan Stanley Smith Barney LLC nor its financial advisors pay a fee to On Wall Street in exchange for the rating. Source: Barron’s “Top 1,200 Advisors,” February 23, 2015, as identified by Barron’s magazine, using quantitative and qualitative criteria and selected from a pool of over 4,000 nominations. Advisors in the Top 1,200 Financial Advisors have a minimum of seven years of financial services experience. Qualitative factors include, but are not limited to, compliance record and philanthropic work. Investment performance is not a criterion. The rating may not be representative of any one client’s experience and is not indicative of the financial advisor’s future performance. Neither Morgan Stanley Smith Barney LLC nor its Financial Advisors or Private Wealth Advisors pays a fee to Barron’s in exchange for the rating. Barron’s is a registered trademark of Dow Jones & Company, L.P. All rights reserved.