Private client commercial conversations

March 27, 2024|Kim's Blog, Lawyers, Relationship Management, Statistics and trends|

At a recent business conversation skills session, private client and family lawyers asked about the nature of commercial conversations with individual clients (as opposed to business clients). These private clients are often high net worth (or ultra high net worth). So here are some thoughts on private client commercial conversations.

Develop your commercial awareness

As mentioned at the session, a good starting point is to develop your overall level of commercial awareness or commerciality.

This is an excellent introductory guide, written by a former lawyer, for young professionals know about commercial awareness by Christopher Stoakes (kimtasso.com). For more experienced professionals, regular reading of media such as The Economist | Independent journalism is always recommended. The Economist annual guides are also helpful – especially for a global perspective.

Which type of private client?

Private clients are not a homogenous group. They may have business or international assets. They may have significant wealth or large incomes or both. They may have old or new wealth. They may be from any generation or culture. They may be at different stages in their life cycle and from large or small families. Some will have specific interests in regions of the world or different sectors.

So segmenting your private client market is a first step. And then, as with all business development, research and think about what will be really important to them. So you can tailor your conversation accordingly to topics that will be of interest to them. That way your comments will resonate and add value.

Back to basics – importance of segmentation and personas (kimtasso.com)

marketing professional services to high net worth clients (kimtasso.com)

High-Net-Worth Individual (HNWI): Criteria and Example (investopedia.com) June 2023

There are numerous resources to help you focus on the needs of high net worth clients. For example:

How the economy will shape high net worth activity – Morrall – Mortgage Solutions December 2023

Lifestyle Trends and Problems Facing Ultra-High-Net-Worth Individuals | SmartAsset October 2023

New research reveals top concerns of high-net-worth individuals in 2023 – RBC Wealth Management February 2023

World Shaping Wealth: the impact of affluence on the next economy (taylorwessing.com)

Commercial interests of private clients

Acknowledging that private clients and high net worth individuals are a varied group, so their interests will be diverse. Their personal circumstances will also dictate what is the focus of their interests too.

Most businesses conduct PESTLE analyses as part of their strategy and planning processes. And these are a good source of basic knowledge.

Be more strategic – PESTLE, Positioning and Plans (kimtasso.com)

Marketing basics – Marketing audits with onions and pestles (kimtasso.com)

But let’s consider some of the main areas of potential commercial conversations for private clients:

Economy

Everyone is interested in the economy – regardless of their financial position. So there will be some basic topics of interest that have a general appeal. But as well as being familiar with the current levels of various indicators, people will be interested to know how these things might change in the future and their impact on their situations.

Emerging markets – Where the biggest future growth opportunities might be
Employment – This will have an impact on the cost of labour and business confidence generally
Inflation – The cost of living and its impact on business and consumer confidence
Interest rates – The impact on savings and mortgages and loans
Long term trends – How the economic and regulation are moving in the long term
Market volatility – The frequency and magnitude of price movements
Real estate prices – Both commercial and residential investments and yields
Recession – Generally identified by a fall in GDP in two successive quarters
Rural economy – Many wealthy people have agricultural and rural investments
Sectors – Which are growing and contracting
Stock market movements

The Bank of England provides excellent introductory material – especially Explainers: the economy made simple | Bank of England on the economy, financial markets, jobs and pay, housing and climate change.

Finance and investment

Let’s start with finance and investment. Typically, these will be areas that are covered by regulated financial advisers when sharing wealth management advice. But general trends and developments might be of interest in conversations:

Alternative investments
Capital markets
Cryptocurrency
Currency rates
Ethical investments
Family offices
Green investments
Hedge funds
Initial Public Offerings (IPOs)
Investment trends
Prime real estate
Private banking
Sustainable investment
Taxation
Venture capital (VC) and Private Equity (PE)

The London Stock Exchange provides excellent briefings for personal investment The Hub – Personal Investing | London Stock Exchange

Other issues

There will be a host of other commercial issues under the broad banner of social, technological and regulatory changes too:

Charitable giving
Climate change
Cybersecurity
Fraud
Lifestyle management (e.g. security, travel, transport)
Luxury goods
Philanthropy
Physical and mental well-being (especially healthcare costs)
Regional variations
Succession planning

Develop your conversation skills

What all this means is that you need to:

Know your audience
Research the types of issues most likely to be of interest to them
Consider which interests relate to your area of expertise or practice
Formulate your own opinions
Develop ways to discuss these issues (and add value) during conversations

Conversations play an important role in building relationships – they shouldn’t be lectures. And you should only share information that might be of interest to the other person at the appropriate time. Remember that conversations are about emotional connection. So regardless of the factual content, your personality, rapport and the quality of interaction will be critical. You show interest and respect by asking questions about their views on commercial issues.

There are many resources to help you develop stronger conversation skills:

Why are questions so important? (Questioning skills) (kimtasso.com)

Conversation skills book review (kimtasso.com)

Conversation skills book review 2 – How to talk to anyone: 92 little tricks (kimtasso.com)

Conversation skills book review 3: Conversational intelligence (kimtasso.com)