Quietroom’s Robin Harries reveals how to break ‘the curse of knowledge’
Robin HarriesQuietroom
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You’ll have heard that, to communicate effectively, you need to ‘put yourself in your customers’ shoes’. Do that, their thinking goes, and you’ll give them the right information, at the right time, for them to make good decisions. It’s advice that the FCA repeats in its new Consumer Duty regulations.
Sounds like a good plan for anyone connected with wealth management. But it’s easier said than done. In fact, anyone hoping to get to grips with Consumer Duty first needs to acknowledge a big cognitive bias that affects every one of us. Ignore it, and nothing about your communications is likely to change for the better.
The Curse of KnowledgeWhen you want to understand a new subject, your first instinct is to ask an expert. But experts can be the worst people to explain the subject of their expertise. And when it comes to something really complicated – like investments – your expert view could lose your audience by the end of the first sentence.
This is because, when you know a subject well, it’s tough to remember what it’s like to know nothing. No matter how hard you try, you’ll likely find that the words you use and the references you make keep drifting back to what works for you, and not what helps your audience. This is known as the ‘Curse of Knowledge’, and its effects are recognised in everything from teaching to advertising.
At Quietroom, we’ve spent years talking about how to overcome the Curse of Knowledge. So as you work through Consumer Duty, here are some ideas for you to think about.
Don’t assume knowledge Firms (and experts) often don’t realise how little many people understand their world. We know intuitively that you’ll lose your audience quickly if you start talking about (say) risk premia. But while you might think you’re on safe ground with ‘bonds’ and ‘equities’, these are concepts that are still likely to mystify millions. And when so much of the content that you use comes from other sources – such as asset managers – it’s easy for your clients to see a document that means almost nothing to them. It’s important that all of the contributors in the value chain, not just professional intermediaries, have end clients in mind and deliver clear, jargon-free content. So, if you’re creating something from scratch, try including a brief explanation of any technical terms you absolutely must use. And before you pass on a document from further up the chain, ask yourself whether your clients have the expertise to really grasp its meaning.
Ask the right questionsConsumer Duty means that firms are expected to test their communications for ease of understanding. But if you want meaningful results, you need to ask the right questions. ‘How well do you understand this letter’ won’t get you very far – we don’t know what we don’t know. Instead, make your questions action-based. Is this product suitable for you? What would you do after getting this letter? What would happen if you did nothing? The Duty is all about equipping consumers with the knowledge to make the right decisions for themselves. It’s the acquisition and comprehension of this knowledge you’ll need to test.
Build a bank of great writingSpend any time working on investment communications and you’ll keep coming up against the same problems. What do we tell people about active vs passive funds? How do we talk about volatility without making it sound scary? Rather than starting from scratch, why not invest some of that time in creating a bank of clear, vivid explanations that you know will see plenty of use? This work could be particularly profitable if it involves as many people as possible right from the start. Compliance and legal teams are often treated like a frustrating obstacle to be cleared at the last moment, but getting their input into a collaborative, creative process is key to avoiding the ‘death by committee’ fate that awaits so much well-intentioned work.
Consumer Duty may seem like another regulatory hurdle to cross. But embrace it as an opportunity to reset the way your business uses language, and you might be pleasantly surprised at the conversations you end up having.
We’ve partnered with Quietroom to bring together our investment expertise with their communications know-how. To find out how we can help you produce clearer communications, please get in touch.