People have natural buying strategies. The financial services industry has categorized these buyers into the Delegator, Validator, and Soloist. Though for the most part these are marketing terms, I have found it is important that clients are aware of them at a minimum, and in a perfect world, will use them when evaluating firms they are doing business with or looking to do business with. It aligns expectations with the company’s offering. From my experience, one of the top reasons clients find themselves unhappy with a service is they are unaligned with the offering. As an example, they might be Validators, while the company they are doing business with has a service model designed for Delegators.
To be fair, (and to set expectations for the next few paragraphs), this is not as easy as I’ve made it sound – but that does not make it any less important. Categorizing your buying strategy is actually more like putting it on a continuum, as opposed to fitting it into one of three buckets. And although you will have a propensity to be one over the other, you will also move from one to the other based on the product and/or service, and your knowledge of it.
Here is a quick overview:
Delegator – This person hires people to do things and trusts they will do it. This model is high-touch and almost always includes some face to face interaction. It is also the most expensive. My parents were Delegators, as are many people from that generation. If their financial advisor said ‘do this or that’, they just did it, no questions asked. Many of the large firms in the financial services industry were built for this type of client, such as Morgan Stanley, Merrill Lynch, and Wells Fargo.
Validator – A person with this buying strategy typically wants help and or input from a knowledgeable source. Their focus is on collaboration, being taught and/or educated. If you are a Validator, you want to be part of the buying process and your mantra is, “Trust but Verify“. Many companies have seen major growth in the last twenty years using a business model that focuses on this group. In the financial services industry, two of these are Charles Schwab, & Co. and Fidelity.
Soloist – A person in this category will have a tendency to do all his or her own research, and then buy the product or service with little or no input. This group is very price conscious. The difference between the Soloist and the Validator is the way they do research, and where they buy the product or service. The Soloist will typically get information from multiple sources and then decide on his/her own course of action based on what makes the most sense to them. Financial services firms that focus on this group are E-Trade and Interactive Brokers.
It is easy to see why you might find yourself unhappy if you are mismatched with a company and/or service within a company. There is no right or wrong buying style. What is important is that you are aware which style fits you best, and that you try to match products and services designed for your style. Knowing your buying style will narrow down your options and help you select the best service that you need help with. There are great products and services for each style; you just need to spend some time understanding them, your options and yourself.