By James Woodfall
Emotional intelligence gives entrepreneurs a distinct edge in building stronger relationships, deeper trust, and better business results. James Woodfall highlights how EI enhances client retention, strengthens leadership, improves sales performance, and increases referrals. By investing in EI, entrepreneurs position themselves for long-term success in today’s relationship-driven business environment.
While technical know-how gets a business off the ground, it’s not enough to keep it growing and thriving. Emotional intelligence (EI) – the ability to manage your own emotions as well as those of others – is the key differentiator that gives entrepreneurs a competitive edge. With this in mind, the article explores several ways in which EI builds this advantage.
Ensuring greater client retention
Individuals high in EI communicate more effectively, respond to client emotions with empathy, and foster long-lasting trust. In business, trust is everything – it builds client loyalty and keeps them coming back. This becomes especially pertinent during volatile periods. You will rely on loyalty the most when times are tough to maintain your business.
Building rapport is often the first step in establishing trust. Ideally, adequate time needs to be allocated in every meeting for rapport building, because when rapport is in place, conversations flow easily.
If you are meeting your client face-to-face at your office, for example, then rapport building starts in the lobby when you meet them, and as you walk together to the meeting room. These small conversations that take place before and after meetings are very important for forming trust and relationship building.
Here are some simple ways to begin building rapport with your client:
- Use their name,
- Shake their hand,
- Find common ground,
- Use context references – eg, ‘The weather has changed for the better today,’
- Offer some information about yourself to get information back.
Using emotional intelligence to deepen conversations and strengthen relationships demonstrates genuine care and commitment. When we pay attention to and are careful with the emotions of others, trust grows. But when we overlook or dismiss those emotional cues, trust begins to wither. Therefore, paying continued attention to the client’s emotional as well as business needs not only develops and maintains trust but also increases retention as a result.
Improving relationships
EI doesn’t just serve the purpose of improving your client relationships, but also your relationship with the team. For example, leaders with high EI take responsibility for the atmosphere they create. They know that in any business, staff closely observe how leaders behave. Not just in big decisions, but in the day to day: how they deliver feedback, how they handle pressure, how they speak when something goes wrong.
Therefore, people who lead with emotional intelligence take particular care in developing knowledge of when the best time to listen is, and when to step in. They can read the room, adapt their style to the person in front of them, and keep conversations constructive, even when there’s tension. That kind of leadership builds trust, reduces friction, and helps people stay focused on the work.
Furthermore, in high-stakes professional settings, communication breakdowns, emotional friction, and reactive behaviour can significantly disrupt productivity. Research by Goleman (2001) suggests that emotionally intelligent leaders foster more resilient and adaptable teams by cultivating emotional awareness, promoting psychological safety, and facilitating constructive dialogue, even under pressure. The value of investing in EI for both the leadership and their team is clear.
Boosting sales performance and revenue
EI also has a significant impact on sales outcomes, particularly in roles that involve relationships, such as financial advising. In a pilot programme conducted with American Express financial advisers, Luskin, Aberman, and DeLorenzo (2005) found that advisers who completed an emotional competence training programme averaged 24% more in gross sales than those in a matched control group. The training focused on developing self-awareness, empathy, emotional regulation, and interpersonal effectiveness – all critical skills for building trust and motivating client action.
Clients are not always rational in how they make decisions, especially when those decisions involve risk. A high-EI entrepreneur can sense hesitation, respond to subtle cues of discomfort, and adapt their communication accordingly. This creates a sense of reassurance, helping clients move forward with confidence.
Increasing referrals
Client testimonials are a valuable source of new business. By building strong and loyal relationships through your work, you position yourself as someone clients will want to recommend within their network.
When you go above and beyond the basic interaction required with your client, for example, not only helping them secure a deal but also reassuring them and addressing any concerns that they may have, this creates deep emotional value, and in turn makes you more memorable and relatable in the client’s social circle.
Clients who feel seen and supported are better able to articulate the value of advice, especially in emotional terms that resonate with others. Simply put, emotionally intelligent professionals are more referable because the client clearly understands their value.
People are more likely to refer someone who not only delivered results, but also made them feel understood, respected, and genuinely cared for. Moments where you demonstrated patience during a difficult decision-making process, followed up without being prompted, or celebrated a personal win are all stories clients will share with others.
Over time, utilising EI to make these positive impressions during client interactions will create a network of advocates – people who trust you, who feel connected to you, and who are motivated to recommend you because they believe others will benefit from that same positive experience.
In today’s fast-paced, unpredictable markets, entrepreneurs need to handle pressure, navigate conflict, and cultivate valuable relationships that drive revenue. Investing in emotional intelligence is key to achieving this. EI not only helps professionals enhance their service but also enables them to stand out from the competition.
James Woodfall
