Why Every Financial Advisor Needs a Norm Peterson

Posted By on Dec 28, 2012|4 comments


Remember Cheers, the hit show from the 1980s?  In the show, one of the main characters, Norm Peterson, is a frequent visitor to the bar, Cheers. He was loyal, consistent, stayed long and recruited others to come to the bar. Every financial advisor should have a Norm.

Norm chose to go to Cheers for the camaraderie. He built friendships at no other bar, or place for that matter, than Cheers. No other place could provide him with the same benefits. Yes, Cheers is a television show and not entirely reality, but the show exemplifies a very important lesson for financial advisors: to get the best clients, we need to understand why clients choose us. Who are our “Norms” and why do they keep coming back? What is our competitive advantage?

Recently, I met with a friend who has a senior position at a bank.  He works out of New York City, but the bank is based in Japan. Since competitive advantage was on my mind, I asked him what he thought his firm’s ‘Norm Factor’ is.  He responded with this: his bank creates a foothold in Japan for US companies.

Now I have not spoken to the firm, nor any of its clients, but I wondered if that really is its competitive advantage. As a financial advisor, you should not wonder what your clients believe your value proposition is; you should just ask them by using a pain sheet.

So what does a pain sheet have to do with Norm Peterson? The pain sheet is an easy way to understand your clients, pinpoint your competitive advantage and define your value proposition. I have used a pain sheet for years.  On the sheet, I list all of the pains I hear from financial advisors when discussing their businesses. I write down the reason for the pain, what the impact is, and the capabilities AUM in a Box can offer to help them solve, or avoid, their pains.

The pain sheet allows me to build an inventory of knowledge so that I am prepared when I talk to other clients facing the same hurdles. Clients appreciate the insight and experience I bring to them.  But it is only because I have the pain sheet that I am well prepared to deal with the obstacles that financial advisors (my clients) face.

I have created a simple set of questions that financial advisors (you) can use with your clients to create a pain sheet.

  • What is working well in our relationship?
  • What makes it work well?
  • What in not quite right about our relationship?
  • What caused you to choose my firm in the first place?
  • What do I do that no other financial advisor does?

Not only will you be able to build a pain sheet with these questions, but also you will understand how you can improve your existing relationships with your clients. A pain sheet is also a simple way to identify your Norm Peterson and what keeps ‘him’ coming back. With a pain sheet, you can understand why Norm buys from you, what the one thing is that Norm loves about what you do for him, and how Norm describes you to friends. A pain sheet might just give you something to cheer about.

Homework: Incorporate the questions above into your pain sheet and start talking to your clients. Who’s your ‘Norm,’ and what’s your competitive advantage?

4 Comments

  1. This is the best article I have read, thank you, I have learned a lot of knowledge in this area.

    Post a Reply
    • Thank you for the kind words.

      Post a Reply

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  1. Top Financial Planning Blogger Michael Kitces’ Two Keys to Attract New Clients | AUM in a Box - […] 3: Build a pain sheet. A pain sheet lists out all the hurdles or pains the niche has. On…

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