Study: Why focus on people, not profits, increases investor trust

July 26, 2010

Corporate PR practitioners, who are trained to manage the customer relationship, know that open, clear communication can lead to increased satisfaction among their publics.

Correspondingly, a new study by J.D. Power & Associates, titled “2010 U.S. Full Service Investor Satisfaction Study,” revealed that while growing numbers of investors believe that their chosen investment firms are driven by profits — not people — overall approval is up by 3.8 percent due to improved client contact.

The study comes at a critical time when trust among financial institutions is in a consistent dive, with only 2 percent of Americans indicating that statements from investment firms are completely believable, according to a recent Harris Interactive poll.

Researchers at J.D. Power found that satisfaction spikes when financial companies foster two-way communication with clients, provide causes behind investment performance and give plain explanations for fees and commissions. All of these reasons point to the client-advisor relationship.

“Delivering the right experience via the advisor is paramount to ensuring high levels of customer satisfaction,” said David Lo, director of investment services, J.D. Power and Associates, in a press release. “Expectations and the importance of the advisor relationship continue to increase.”

Based on the results, J.D. Power recommended regular contact with clients, honest communication about performance and continued annual reviews to strengthen investor perception and trust. — Philip Volmar

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