How Dunbar’s Number Relates to Financial Advisors

How many meaningful relationships do you have? And how many are with your clients?

The Dunbar number refers to a study conducted by Robin Dunbar in the 1990s, which states that humans of average sociability are capable of maintaining about 150 stable relationships. Dunbar defined these relationships as “the number of people you would not feel embarrassed about joining uninvited for a drink if you happened to bump into them in a bar.”

This number and general thinking applies to financial advisors because, as technology progresses toward performing the basic tasks of advisors, relationships are becoming more and more important. When it comes to earning referrals and driving retention, the rapport you have with your clients is crucial. They are just as likely to fire you for not maintaining communication or having a poor understanding of their goals as they are for performance.

If a human can only maintain 150 relationships, how are they supposed to have the social bandwidth to stay in touch with all of their clients?

Here are three ways you can stay in touch with the people who matter most to your business.

Create tiers.

Take all of your clients and group them based on the amount of money they bring to the table and how valuable they are to your bottom line. Create a VIP group that receives the bulk of your attention. If you have clients who qualify as a VIP, but who are content to not communicate often, don’t force it—the preference of the client is paramount.

Think about something special you can consistently do you for your VIPs. If you take a normal client out for a cup of coffee, do dinner with a VIP. If you send some personalized direct mail to normal clients, consider sending the VIPs something like American Lifestyle or Start Healthy magazine. Always make sure to go above and beyond the already wonderful level of service you provide.

Send email.

Send email

This is an easy and effective way to reach your clients from your office. It might seem a bit sacrilegious, but now that we all have mobile devices, your reputation is impacted by your response time. That means going out of your way to answer emails during non-business hours will build loyalty.

Download a PDF sample of American Lifestyle to stay in touch with past clients.

If you treasure your ability to turn off and step away from work, that doesn’t make you a bad advisor. The key is to set boundaries. If a VIP client emails you during the evening, have a personal policy of responding ASAP. If the email is from someone else, allow it to wait until morning.

Have meetings.

Have meetings

Try to meet quarterly with every one of your VIP clients (assuming they want to). These face-to-face interactions are opportunities to socializ, reiterate your value proposition, and cultivate rapport with one of your 150 stable relationships. When you have this kind of history with a client, they are far less likely to fire you, and far more likely to refer friends.

Your 150 relationships can’t all be clients, and most of them will not be. But every financial advisor has certain people who mean a whole lot to their overall AUM. These people need your attention, and it’s crucial that you keep in touch and show appreciation.

Written by Sefton Eisenhart

A writer who deeply believes that everyone is in sales.