6 ways for advisors to evolve a client-focused business strategy

August 1, 2022 12:17 PM

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The acceleration of digital transformation has been a hallmark of the pandemic era, but it has also highlighted the importance of maintaining a strong focus on the client experience.

From leveraging a new indexing tool that enables advisors to see how they compare to their peers to adopting a hybrid approach to wealth management, here are six ways advisors have been incorporating new client-centric ideas and techniques to boost their businesses.

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Cerulli-Invesco tool lets financial advisors see how practices measure up against peers

Advisors recognize the need to constantly improve their business to compete more effectively with peers, but they haven’t always had access to tools and information that can help identify a practice’s strengths and weaknesses.

The Practice Innovation Index, recently launched by global asset management firm Invesco and wealth management data specialist Cerulli Associates, is an all–in-one platform that enables planners to see where they rank versus their competitors in key areas, such as practice management and client services.

Paul Brunswick, head of Invesco Global Consulting, said most advisors aren’t able to pinpoint the weaker areas of their practices, and aren’t always clear on how to fix them. “The index closes the gap between knowing and doing,” Brunswick said. “It’s closing the gap that creates success.”

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Cerulli-Invesco tool lets financial advisors see how practices measure up against peers

We learned to connect with clients virtually during the pandemic — and we plan to keep it up

The unexpected emergence of the global pandemic jolted the industry into a state of anxiety over the impact on business and, specifically, on client relationships.

Faced with this challenge, advisors have been creative in adapting to the new circumstances and taking a proactive approach to clients that has led to better, stronger relationships.

“There are things the pandemic taught us that made us better as advisors and as humans — namely, how to connect with clients on a deeper, more meaningful level,” said managing director Eden Lopez at RBC Wealth Management. “Why wouldn’t we carry that lesson forward?”

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We learned to connect with clients virtually during the pandemic — and we plan to keep it up

The future of wealth management is hybrid — both digital and in-person

If wealth managers were not already fully aware of the Darwinian principle that it is not the strongest or most intelligent that survives, but the one that is most adaptable to change, the pandemic provided a timely reminder.

Firms rapidly adapted to a changed world by embracing digital transformation, with video conferencing, online portfolio access and other forms of digital client engagement becoming the norm. But human interaction still remains vital, and a hybrid approach to wealth management appears to be the future.

“In many ways there has never been a better time to be a hybrid wealth manager — one who uses both in-person and digital approaches to build a relationship with clients,” said Will Bailey, chief strategy officer at InvestCloud, a proponent of the need to evolve and adapt.

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The future of wealth management is hybrid — both digital and in-person

4 questions for client experience expert Charesse Spiller

Charesse Spiller, founder of Level Best, an operations and technology consultant to financial advisors, believes delivering an outstanding client experience is one of the most critical aspects of working as a financial planner.

Spiller spoke with Financial Planning to share her perspectives on the definition and evaluation of client experience in the wealth management industry, specific client experience pitfalls firms should avoid, and client experience best practices she would recommend.

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4 questions for client experience expert Charesse Spiller

Putting the ‘personal’ back in finance is a must for young investors

Automation such as algorithmic investing and automatic portfolio rebalancing has transformed wealth management.

But despite the many successes of this digital transformation, research shows that the investor demographic that most craves the personal, human touch of a financial advisor is the one you would least suspect: digital-savvy young and pre-middle aged adults (18-44).

Taking care of the emotional needs of investors is key. “It is easy to find an experienced financial advisor with a high IQ,” said Lule Demmissie, president of Ally Invest. “But today’s client also needs an advisor with a high EQ (emotional quotient).”

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Putting the ‘personal’ back in finance is a must for young investors

Growth-minded advisors embrace a tech-driven, borderless future

Advisors have always recognized the need to constantly evolve and adapt to drive their business. They have not, however, had to do so with the speed and efficiency that was required in response to the disruption caused by COVID-19.

Moving rapidly out of one’s comfort zone during the pandemic had its challenges, but there have been many upsides, such as Zoom meetings. “They will never replace in-person meetings,” said Evelyn Zohlen, president of Inspired Financial. “But I think we’ve all been surprised at how much you can do.”

Indeed, many of the tech changes and new business practices which were adopted as short-term measures to get through the pandemic have proved to be so effective that advisors are now incorporating them in their strategic business plans for the future.

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Growth-minded advisors embrace a tech-driven, borderless future