4 Chapter 4: Sales versus Advising.

Defining Advising

What is Advising?
Why is it so important?
Is financial advising simply sales?

These are essential questions for anyone pursuing a career in finance. Future finance professionals must understand that advising is more than offering financial products — it’s about serving as a trusted guide through a client’s financial life. In Canada, where the financial industry is highly regulated, professionals must perform due diligence, meet compliance standards, and demonstrate ethical behaviour while growing their book of business.

Canadians seek knowledgeable advisors to support their short- and long-term financial goals. These clients aren’t just looking for a product — they’re looking for confidence, clarity, and consistency in the advice they receive. As such, advising involves listening, understanding individual circumstances, identifying needs, and developing personalized recommendations.

Although advising includes elements of sales, it is a service-driven role, rooted in client trust and ongoing relationships, rather than one-time transactions.

A Brief History of Sales and Its Impact on the Finance Industry

Sales as a profession has evolved significantly over the past century — from the aggressive, product-pushing tactics of the early 20th century to more customer-centric and ethical approaches (Swensson, 2015; SalesForceSearch, 2013). Historically, salespeople were trained to focus on closing the deal quickly, regardless of whether the product truly met the client’s needs (Kotler & Armstrong, 2008).

During the post-WWII economic boom, the sales profession became more structured, with formalized quotas, commissions, and sales training programs (Kotler & Armstrong, 2008). However, this system also introduced high-pressure tactics that reinforced the stereotype of the untrustworthy, quota-driven salesperson (Rao, n.d.; SalesForceSearch, 2013).

In more recent decades, technology has reshaped the profession. As Petrone (2023) explains, twenty years ago CRM systems were in their infancy, smartphones did not exist, and door-to-door selling remained common. Today’s sales professionals face new expectations: buyers are more informed, expect advisors to understand their industries, and demand personalized, consultative experiences. While tools and techniques have changed, the foundation of successful sales — relationships, integrity, and communication skills — remains constant.

The finance industry has experienced this evolution firsthand. The Canadian Bankers Association (CBA) notes that the first bank in Canada was established in 1891. Today, more than 80 domestic and foreign banks operate across the country (Canadian Bankers Association, n.d.). Technology has accelerated this growth, and recent global events — such as the COVID-19 pandemic — forced financial institutions to rapidly adopt virtual models of client engagement. As a result, adaptability and relationship-building in digital spaces have become critical components of effective financial advising.

Why Advising is Different from Traditional Sales

While advising may involve selling investment or insurance products, it differs significantly from a traditional sales role. Sales is often transactional and product-focused, with the goal of meeting quotas or closing deals. Advising, on the other hand, emphasizes relationship selling — a long-term, trust-based approach that prioritizes the client’s best interest.

Finance professionals must be especially mindful of the delicate relationship that forms with clients. They are not just selling financial solutions; they are also selling themselves — their credibility, ethics, and professionalism. Clients must believe that their advisor genuinely understands and supports their goals.

Relationship selling, by definition, is a technique where the advisor focuses on building a personal connection with the client. Trust is developed over time by consistently adding value, demonstrating empathy, and maintaining open lines of communication before recommending any specific solution.

Unlike traditional sales roles, financial advisors are also held to higher regulatory and ethical standards. In Canada, advisors are expected to meet obligations such as suitability assessments, full disclosure, and transparent documentation. These expectations reflect the advisor’s responsibility to act in the client’s best interest, not just to complete a sale. In Canada the body that oversees Financial Institutions and their sales practices is Financial Consumer Agency of Canada(FCAC).  On March 20th 2018, the FCAC published a report titled “Domestic Bank Retail Sales Practices Review”. The main findings show that the retail banking culture employees to sell products and services, and rewards them for sales success(Financial Consumer Agency of Canada, 2018). Measures were recommended to the retail banks in Canada to establish a formal sales practices governance framework.

It is important to note that in the finance industry that all bodies have a code of ethics – what is present in all of these codes is that protection of the client is critical to ensure that key client components are considered and that the client needs are always considered. We will refer to two Credentialing bodies in Canada in the next section on how Ethics plays a key role for client interactions.

In short, while sales and advising may overlap in action, their intention, accountability, and client impact are fundamentally different. Understanding this distinction is essential to becoming an ethical, effective finance professional.