Advice Is the Hardest Thing in the World to Sell
I’m convinced that the fastest growing industry in the world is cheap advice. From discount houses to DIY websites to blogs like this one, everybody’s got advice for us and most of it’s worth exactly what it costs, little or nothing. That’s because it’s not advice. It’s information and information without a user’s manual is useless.
Listen to the full audio episode or read the transcript below to learn why advice is the hardest thing to sell.
There’s so much information disguised as advice being shoved our way that it’s hard to tell the good from the bad. Real advice gets lost in the shuffle.
Our advice is hard to sell precisely because there is so much information flying around falsely packaged as advice.
A high school student can get a PhD’s worth of investment information from the internet. Would you want to turn your life savings over to a high school student? It’s not a question of getting the information. It’s a question of knowing what to do with the information, of knowing good information from bad.
Too many companies are wrapping their cheap advice in slick and misleading advertising. They do a very good job of convincing the consumer that having the information is enough. Information is not enough.
Information is general data. Knowledge is the practical use of that data. Advice is a recommendation concerning a future action based on that data.
Having information of investing is one thing. Knowing what to do with it is something else entirely.
If you are confronted with a situation that pits you against someone with lesser fees, it’s not a question of you having better information. You don’t.
Discount houses make great information available with the click of a mouse. Rather, it’s a question of you having the knowledge and wisdom necessary to make the right decisions, to act on that information. It’s your ability to give proper advice.
Explain to folks that the challenge is not to pick the best investment. The challenge is to pick the right investment.
And that takes experience.
I have an Advisor friend that keeps a 55-gallon drum full of no-load prospectuses in his office. He’s been around long enough to have collected them, but, yes, you can still request a paper copy. When a prospect tells him that he or she is thinking of buying a no-load fund, he dumps the barrel upside down and dozens, if not hundreds, of prospectuses slide out. He explains that they can read through those and hope they make the right decision or he’ll do it for a very reasonable fee. They only have to make one decision. Do you want an experienced person in your corner?
Another Advisor friend tells his clients about his son locking his keys in his car on a weekend night. It cost him $90 because he made a mistake. It was no big deal. We all make mistakes, right? Well, one simple mistake trying to run your own portfolio could cost you $9000, Mr. Client. Do you want to take that chance?
Your challenge every single day is to sell yourself.
Yes, we are in the advice business. Advice is your inventory. But don’t try to sell your advice. People don’t want your advice. They want what your advice can do for them. Actually, they want what you can do for them. So, as a consumer, I have to make a choice. Do I want free information, no matter how good it might be or do I want you in my corner? It’s up to you to influence that decision.