Low-key client events make sense now

We have advocated client appreciation events for years.

We have advocated client appreciation events for years. We have provided contacts, planning timelines, themes and menu ideas to put the most unique and exciting client appreciation event at financial advisers’ fingertips, leaving nothing but the invitations to be printed.

We talked about how much clients would enjoy a gourmet picnic in the summer or a seated holiday dinner. We talked about how easy and efficient it would be to gather more assets and referrals.

Throw it out the window.

In this market, the last thing you should do is plan a lavish client appreciation party. Aside from the cost to you and your practice, it is neither the time nor the place; clients might find it downright crass.

Economic shock is setting in, and improvement doesn’t seem to be around the corner as we all hoped.

The shock is causing clients to undertake lifestyle changes. They are trimming and downsizing, making provisions to weather this storm.

Financial experts who are talk-show guests advocate small changes, dispensing with the small luxuries such as a morning cappuccino or a monthly DVD subscription.

Sadly, clients are in even more dire straits than that. They are trying to sell their homes in a pathetic housing market or facing the possibility that they may not be able to finance college tuition.

They were ready to retire in May and are slowly realizing that they can’t.

Fun and celebration are the furthest things from their minds.

We have a husband-and-wife adviser team who holds their client event annually in the fall.

The theme and venue are casual — a barbecue or picnic setting. The unique aspect of their all-day affair is that it is a charity fundraiser.

The first year of the fundraiser, the team attracted almost 300 clients and friends. The second year, the number fell to about 200.

When they asked their clients for feedback about the large annual event, the clients said that they didn’t feel like they had a chance to connect to the couple.

There were so many clients competing for the same two people that the event became ineffective.

This year, to emphasize quality versus quantity, they are planning to host as many small seminar-style events as they can. For clients adjusting to a new lifestyle, donating will lose priority or they will want to donate to their own favorite charity, not the adviser’s.

Most clients will understand that all investors are losing. They will listen to your advice and maintain a level-headed approach to their investments.

But they probably won’t view a three-course meal and wine pairings on your dime (and what they ultimately view as their dime) as a show of appreciation. The key is to reach out to clients in a humble way.

Couching an event in an educational context is appropriate, and holding a small gathering in the morning or afternoon connotes a more serious tone.

This isn’t the time to invite a wholesaler to make sales pitches or ask for referrals. This is the time to invite a local high school guidance counselor to talk about applying for student loans and tuition assistance.

Another option is an organizing expert who can provide tips on easy ways to organize a home office or store important financial documents. Or you can bring in people who can offer guidance on applying for Social Security or Medicare.

A presentation should be be-tween 20 and 30 minutes.

Food and refreshments should be minimal — bagels and coffee or juice for a morning meeting, perhaps a fruit platter or cheese and crackers in the afternoon. Alcohol shouldn’t be available.

If possible, host the gathering in your office, rather than spending money to rent a space.

If you know a client well enough, ask if he or she would be willing to have it at home. It is probably not a good idea to host the event in your home, which would allow clients a more intimate view of your lifestyle.

Also, keep the audience small. Mass gatherings invite people to connect about their losses, and the mood can become bitter rather than constructive.

We call this “M&M” time: modesty and a message. The point is to reach out and face realities with clients.

Falling off the radar isn’t an option. Advisers who fade away over the next few months will probably lose their clients.

Individual meetings are the first course of action. A low-key gathering that educates clients about dealing with major losses may mitigate your own.

Jim Steves is a sales manager at Cadaret Grant Agency Inc., which is a sister company of Cadaret Grant & Co. Inc. Both companies are located in Syracuse, N.Y.

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