Preface: Innovations, powerful external events, and a forever changed consumer have coalesced to create upheaval in the wealth management category. This session will dissect the component parts of wealth advice through the eyes of consumers. The findings will help attendees see the key drivers of value and help determine where to place their modernization bets.
Transcription:
Josh Book: (00:08)
Thank you. Wow. We've got some masses in the seats, Phil. Um, boy, did the organizers show their Moxi by putting a couple of Canadians in between some pent up, uh, demanding conference, attendees and cocktails. I'm not quite sure how this could go, but we'll, we'll do our best and we will always be thinking about cocktails. So don't worry. Um, look, it's nice to be live with with you. Um, it's what, the first time in, in two and a half years, I think that Phil and I have been in front of more than four people. So that's exciting, but a little bit terrifying at the same time. Um, a quick show of hands, you know, who in the crowd has a financial advisor show of hands. Wow. Not that many. Um, maybe are being bashful. What about self-directed investors? Anyone in with an self-directed investing account.
Josh Book: (00:57)
Nice. Nice. And then what about robo? Anyone engage with robo at all? No, you've got all three. That's awesome. Uh, I thought we'd started a little bit with my own kind of wealth management journey over the last little bit. Um, about 10 years ago, I decided to somewhat reluctantly consolidate my, my finances, my money with, with a large wirehouse broker, um, happened to be my brother-in-law more about that later. Um, and you know, I'm, I'm, I feel like a pretty informed investor. I was an investment banker when I started my career, uh, but I also felt that there was value in, in outsourcing that part of my life. Uh, especially based on the time, the amount of time I felt like I could put to portfolio choices and so on. Um, and so that happened and that felt good about it. And then a couple of years later, I started a company that quickly found its way into the middle of this wealth management modernization era.
Josh Book: (01:57)
Um, and after spending more and more time with kind of, you know, innovation and seeing what was happening in the, in the wealth space. I also remember noticing a change in how in myself and how I felt about my own wealth management service that I was getting. And so the more time I spent within the industry and studying consumers and seeing digital approaches, the more, I couldn't help notice how I was feeling about the service I was getting, I kept feeling like I was searching for value. Um, I couldn't quite put my finger on what it was, but there was something that was kind of irritating me or bothering me. Um, and so I started to think more and more about the wealth advi, the wealth advisor experience that I was getting. Um, it seemed like they did all the things, you know, they sent me educational content.
Josh Book: (02:43)
Some I understood some, I didn't, some was relevant to me, some wasn't. Um, I got periodic emails from an assistant saying that, you know, my, my, my portfolio had been reviewed and there was X, Y, X or Y recommendations. Some, I agreed with some I didn't. Um, they even gave us their, you know, financial planner to do a plan for us. Great news. We're in good shape. Uh we're on track. Uh, that was sort of the output after just a painful experience of giving them information and bank statements and so on and so on and so forth. Um, they did sell me some life insurance. So I guess that's good, I guess, suppose I needed that. But then a lot of things had changed. Like, like I bought another house, my wife changed a job. I started a bloody company, we had another child, um, nothing.
Josh Book: (03:39)
And so I started to realize that portfolio management wasn't really the value proposition that I was connecting with. Um, Mo most, I was kind of doing that myself. So like, what was I paying for? And I felt like I was an intermediate, I guess, investor customer type. Um, and so I was really struggling to see the value proposition clearly. So after a bit of deliberation thinking about the family ramifications of this choice, but we decided to say, you know, we're gonna move our assets. And we moved them into a direct brokerage platform that was a friction filled, horrific experience. I don't wish it on anyone or at least the firms better get better at doing it. Um, but I tell you all of this really as a way to describe what we do at parameter, um, which is really to say that we're passionately trying to understand behaviors like I just described, um, and help our clients make the right investments in their businesses to get ahead of consumer behavior and trend and deliver the best wealth experiences, uh, that they can.
Josh Book: (04:44)
And so kind of over the, the course of the years of, of running parameter, um, we heard a lot of discussion about wealth service models, innovation. I think my friend, Evan here is here from PWC. They love to talk about innovation. It's a very nebulous word, uh, new digital wealth advice models coming on, uh, online and promoting, you know, this feature or that feature. Um, but I don't hear a lot about how firms are seeking to truly, truly understand the very customers that they're trying to engage. Sure. Many will do a survey they'll collect, uh, some data about some demographic segment that's deemed important, uh, at the time, but then the same old kind of go to market and product launch strategies seem to be deployed. And then people are kind of confused by the lack of consumer uptake, uh, that they get. So, you know, it's clear and we heard a little bit earlier, um, from Cynthia Goldman, the way that we're interacting with products and services has been changing pretty rapidly.
Josh Book: (05:49)
Uh, especially as external forces have influenced our behaviors, even over the last, whatever two and a half years. Um, we're talking to clients every day and there's no doubt that the wealth management business is mobilizing to address these changing consumer needs, but we think there's just so much work to do. Um, you know, how do we meaningfully reach and engage wider varieties, uh, of customers, most of whom have a minimal understanding of investing. They're challenged to understand the impacts of today's choices and behaviors on tomorrow's needs, but the way people are want to engage in their financial lives is changing for us, never been a better time. We were just talking Evan, uh, to be working in financial services and, and wealth management, you know, the boon of automated investing the rise of digital tools to help engage customers more on their terms. Um, technology innovations for things like planning, God, that process I went through about eight or nine years ago was horrific.
Josh Book: (06:53)
Um, you know, the second tsunami, uh, into online brokerage, bringing millions of new investors into the wealth management fray. All of this for us has contributed to the sort of foundation from which I think the next iteration of how people engage in their financial lives will play out. So convergence of those, of all the channels, um, is an exp and experiences is something that that is happening. Um, and so we're grateful to play a, a part in supporting our partners and, and clients and doing that. Um, with that, I'm gonna turn it over to my friend and our head of research, fill the thrill. Um, and he's gonna talk a little bit about our research approach, and then we'll start sharing with you folks. Some of our, um, our latest data, uh, first will be just about kind of awareness and usage, and then we'll move on into, into some loyalty stuff.
Phil Darling: (07:46)
Slide. Uh, thanks, Josh. Um, so before we get into, uh, reviewing some of our data, I'll just take a minute to orient everybody to our core research data products, um, in both the us and Canada, we do nationally representative surveys, uh, with thousands of respondents to get final samples that are balanced in terms of age, gender region, uh, among consumers aged 18 to 79 within each population. So the content of our surveys actually has a pretty broad scope in terms of covering both challenger and incumbent firms within three main wealth channels. So digital wealth advice you think of acorns, Wells Fargo, intuitive advisor, self-directed investing. So trading apps and online brokerages, Robin hoods trades of the world, that sort of thing, and then traditional wealth management. Uh, so the more high touch services, uh, provided by a professional from the likes of JP Morgan wealth management Satara and so on.
Phil Darling: (08:38)
Um, one important topic that we're going to touch on a few times in this is this idea of convergence among these different wealth channels and how our research has evolved, uh, to keep pace with those changes in the market. So, one example of this, a pretty simple one would be with a digital advisor, adding a self-directed component to the offer and perhaps a bit of a human touch. So the so-called hybrid approach, um, in other words, robo with some DIY and, uh, traditional flavor. So our research is primarily concerned with two units of analysis, uh, the first being the firm or the brand and the second being, uh, the individual consumer. So more specifically our flagship syndicated reporting series, we analyze and interpret the consumer data at a couple of different levels. Uh, this will get into a bit of marketing research jargon, but it's, it's not too bad.
Phil Darling: (09:22)
Uh, the first is called the category level. So that's just data aggregated from different brands within a given wealth channel, uh, the second being brand specific or the brand level. So we're actually talking about a, you know, a given brand so acorns, we can look at some loyalty engagement data for them. Uh, and then the third being more the respondent level characteristics. So typical demographics, assets, income, uh, engagements, uh, engagement in various parts of the wealth service. So having a financial plan, engaging with an advisor, those types of things, uh, we're almost there . Um, so for parts of this presentation, we're gonna be talking about data at the category level. So you just have to know this idea of a net, uh, and that's just a marketing research term. It means one or more. So if you have net brand awareness within a given category, all that means is awareness. Phil Darling: (10:05) So for digital wealth advice would be awareness of one or more Rob advisors. So a pretty straightforward idea. Um, but let's, uh, ease into some data now with a few high level stats from our latest, uh, us data. Um, so very high level off the top, uh, brand awareness, we're talking about category awareness of digital wealth advice. So just under 70% meaning a good proportion of, uh, consumers in the us are aware of firms like betterment, acorns, Merrill, guided investing, and so on. Uh, we can see that about three quarters of adults are able to recognize at least one self-directed investing brand. So then you've got, you know, E-Trade Schwab brokerage accounts and so on. And our surveys, you know, have long lists of brands that we cover. Uh, and then finally, category awareness for traditional wealth is roughly on par with self-directed. So firms like Morgan Stanley wealth management, and so on. Phil Darling: (10:53) Now, before we go from awareness into engagement, uh, we need to unpack this idea of awareness a little bit further within digital wealth advice. So as a relatively new wealth channel, we've seen, uh, awareness grow considerably over the past 10 years or so, but understanding remains relatively low. What I mean by that is, you know, there are two different things there's awareness and understanding, uh, when it comes to the average consumer, they're able to recognize a given brand, but they don't really understand what it is they do. So you've got, you know, yeah, I've heard of acorns, you know, they have that saving investing app, uh, saw on CNBC, that kind of thing. Um, and across those channels, a big part of what we've done is try to work with our clients to understand some of those key marketing questions. So about the nature and level of understanding, that's really required, uh, to move people down the funnel. So getting from awareness into consideration usage and so on, um, and ultimately, you know, having that engagement, uh, when it comes to wealth broadly, our data's clearly shown the need for simple communications about the brand, uh, that avoid financial jargon. So we've seen that, that, uh, , we've seen, we've seen that not being done over and over. Uh, so I'll just, uh, I think Josh had a, a point about this idea of the category confusion, and it's not specific to digital advice, but that's where we kind of first saw it. Josh Book: (12:04) Yeah. I mean, that's the point we, Phil was giving an example in the context of something relatively newer in, in this term robo or that service. Um, but that's totally applicable into a traditional advised channel as well. Your customers and clients may be coming you from a, for a brand reason or a referral reason, or what have you, but it doesn't mean they actually know what you're doing. They don't really know what the value proposition is necessarily. And we'll get into a little more data. That's gonna showcase some of those ideas for you Phil Darling: (12:30) All so usage. So going from that category level awareness idea into category usage, we have to just update that notion of the net. Now we're talking about having an account with one or more firms within the category. Uh, so for example, if I have an account with acorns, an account with betterment, I'm just gonna get counted once, uh, in terms of this category level brand usage within digital advice. Um, so we can see roughly one in five adults say that they have an account, um, with a digital advice firm, whereas about a quarter, uh, have one with a self-directed, uh, investing platform and then traditional wealth, which has a higher cost of engagement or a cost of entry at about 15%. Now there's a couple of other stats on here. Um, so, you know, one of the important things we do is track engagement over time. Phil Darling: (13:12) And we can see that there have been a couple of big year over year dips, uh, for both, uh, self-directed and robo and a more dramatic dip for self-directed, uh, from our own tracking data, uh, and many reports from prominent online brokerages and trading apps. We know that record numbers of users flooded in, uh, to self-directed in 2020 and 2021. Uh, everybody remembers wall street, bets game stop, um, and all those, all the drama that unfolded early last year. Um, our most, our most recent consumer data though is quite fresh. So it was collected during the downturn, uh, and we expected to see a dip in engagement. Uh, what's interesting is the, the relatively large drop for self-directed compared to robo, uh, and this kind of taps into this idea that maybe robo is a little more sticky during a downturn. Uh, and what do I mean by that while, you know, compared to a digital advice relationship, it's relatively easy for someone to cash out from their own brokerage account. Phil Darling: (14:02) There's more liquidity associated with those, uh, trading apps. Whereas robo is more of a set and forget it with, with more frictions when it comes to withdrawals. Uh, so when it comes to traditional advice, even though 15% say they have an engagement with firms like JP Morgan, wealth management, or an advisor from LPL, uh, one in three adults report having a traditional advisor. So they're thinking there might be a disconnect there. It just means that people who engage with the financial advisor doesn't necessarily mean that it's with a, uh, traditional wealth management firm. Um, so I'll pass it back to Josh. Now, he's got some, uh, Josh Book: (14:33) Thanks, Phil. Um, the more that we talk with our clients and kind of this, you know, now seven, or what have you, years of studying consumers and data, um, like it gives us clues about what the future wealth management services might look like. Um, for example, and, and you're hearing a lot of these themes, which is a bit validating, frankly, for us, I think today, but, you know, the notion of convergence of the wealth management service channels across the channels, uh, you know, the idea that, that a, a checking account doesn't really have to be the anchor bank product, um, for those sort of full service firms, uh, or the main client acquisition, uh, driver, you know, the role of self-directed investing channels can, can play a much different, can play much differently. Um, how planning is done in if planning is done well, how it can help guide clients over the journey over their journey with, with, uh, with a given firm or advisor, um, perimeter parameters started as a small data and analytics driven strategy consultancy, and it was an early engagement with the, uh, large Canadian banks, uh, wealth management business that put us kind of at the forefront of digital advice. Josh Book: (15:47) Um, I was certain then that we sat at the beginning of kind of meaningful change in the wealth space. And I, I was right. Um, there's been more change in the wealth business in the past six years than the previous 25. I don't think anyone would probably argue with that. Um, but it's still for . Um, but it still feels somewhat early to me. Uh, I think operating models have to drastically change to keep up with the technology that's available even right now. Now withstanding that that technology will keep rapidly increasing, um, in order to meet customer needs as they're gonna be in the next 10 years and 15 years. Um, and I think that's an area of focus, uh, for, for the industry. And so we felt then, uh, certainly as we do now that there's there, isn't a more important time to be studying consumers in the context of the wealth of wealth management, you know, back then, uh, the context for us centered on this thing stupidly called robo advice. Josh Book: (16:44) Uh, but then our study expanded to include another digital native self-directed investing. And then as those and other innovations have begun making their way into the traditional advice channel, we've continued to find ways to understand the relationship between consumers and advisor led businesses. And so finally now we've expanded to include traditional wealth advice within our full stack of consumer data. And so we're gonna share with you, uh, some very fresh data. Uh, it, you know, we're always talking with our customers and it's these kinds of, and we're trying to UN understand what are the kinds of questions that you're all trying to answer in your own businesses and it's that back and forth relationship. Um, that really helps us keep our data product refresh, refreshes, thematically, topical, uh, and useful for, for the industry. Um, and it's one of those kinds of conversations and the things that we've been hearing a lot over the past couple of months is how do people's primary bank relationship influence their wealth management service choices? And so, Phil, do you wanna share a little bit about that? Phil Darling: (17:46) Yeah. Um, so just a quick preface, um, like as Josh was saying over the years, we've kind of adjusted our approach and, and updated things. Uh, and what's nice about having the consulting side of the business as well as the research is that it creates this virtuous cycle where learnings in one area inform and improve the other. So we've got this nice kind of dynamic that way, as Josh mentioned, you know, a lot of our clients have recently been asking about, well, how does the, how does the primary banking relationship or the primary financial financial institution impact engagement within the wealth wealth channels? Uh, so specifically when thinking about those who consider a specific bank brand to be their primary institution, how does engagement in wealth services look among those consumers? So our clients are asking us, are we getting our fair share, uh, customers into our wealth channels? So to answer this kind of question, we actually, we have to shift focus from those high broad category level engagement measures into more of a brand specific engagement. Uh, and what we see is that already having customers in the fold means already having overcome a very large hurdle towards, uh, wealth channel engagement. Phil Darling: (18:46) So we've got a kind of a little mini case study here for, uh, based on Wells Fargo from our, uh, from our consumer survey data, um, what this shows and it's, it's not well labeled. So I'll kind of walk you through it. Um, regardless of the primary bank engagement in Wells Fargo's traditional wealth offer is about 3.1%. So in the top bar of the chart, that's the, the small light colored box on the left. Now we know from our data as well, that about 10% of Americans aged 18 to 79 consider Wells to be their primary financial institution. And what's crucial is that within that cohort engagement in the traditional wealth services from Wells rises from 3.1, that sort of general, you know, gen pop level stat to 15.6%. So it's a five X, uh, an engagement for the traditional wealth offer from Wells among those who consider Wells to be the primary, uh, financial institution. Phil Darling: (19:37) Now that's the second segment in that bar at the top. So that gets us up to 15.6. If we go one step further and look at those who are very satisfied with that primary banking relationship, it goes up further. So it rises up to 21.3%. Um, so the takeaway is, is pretty clear. People are much more likely to engage, uh, with traditional wealth offering from the financial institution that they consider, uh, primary, especially if the relationship is strong, uh, it's not shown here, but the same pattern plays out for other big incumbents like JP Morgan chase bank of America, Mell. Um, but what's interesting here is that the pattern isn't just exclusive to traditional wealth services. If we look at the second bar in the chart, that's, uh, engagement with Wells trade. So the self-directed, uh, investing offer usage goes from 1.2 in general. So the, the gen pop stat, um, to 6.2 among those who consider Wells to be primary. Phil Darling: (20:26) So again, that's this five X, uh, rise engagement, and then further to 7.6 among those who are very satisfied with Wells, um, same, same sort of thing for intuitive advisor. So the, uh, the robo offer from Wells, that's the bottom bar of the chart, uh, with all this talk of bars, I hope people aren't getting too thirsty. It's, uh, for intuitive advisor, general engagement is 1.6%, but among those again, who consider Wells as primary, more than doubles to 3.8. So among those very satisfied, we're up to 4.3. So it's not as dramatic, but it's still the same kind of, uh, pattern playing out. Um, so our reporting examines, these and other engagement dynamics that play out at both the category level and the brand specific level, uh, Josh is now gonna take you through some of our data. That's more about individual level relationships, uh, with financial advisors, um, or the person to person rather than anything specific to a given firm. Josh Book: (21:15) Thank you. I think just before I do that, I'll pause on this. Um, this is this data. I mean, maybe it's not like a gr an earth shattering, uh, takeaway, like if you bank with Wells Fargo, you're maybe more likely to engage in, in one of their wealth channels, but, but I think what struck me is the, is the, the lift that you get at the rate that they're getting, especially when you consider, and, and this is for all the firms that the, the trend is the same. We just use picked Wells for no particular reason. Um, the, the reason I, I want to pause on it is because, you know, when you think about customer acquisition, uh, the cost related and you think about long term value of customers, um, and then you think about the context of which this is happening. It retail bank and wealth management businesses don't play well together, which is insane, but they don't. Josh Book: (22:08) Um, imagine when these firms start thinking more about that fact, and they think about how they're gonna provide, you know, wealth engagement or, or retail banking engagement, and kind of start wrapping their arms around customers in much more modern and sort of frictionless ways. I think you're gonna see these numbers, um, exponentially rise and, and they'll start acquiring more and more and more share of wallet in more effective ways, especially as the consumer kind of changes the way they want to interact with their financial lives. Um, so sort of a takeaway and something I think important for us to continue looking at and going deeper on, um, so into sort of the, the traditional advisor relationship, um, and zeroing in there a little bit, we, we asked, um, what services people are, are getting from their advisors, uh, as sort of a starting point, um, and some dis some interesting data emerged, you know, I'd asked the group, um, just holler out, like what percentage of people do you think would say they use a financial advisor for the management of their investments, like holler, anyone percentage numbers. Josh Book: (23:18) 38? Phil Darling: (23:21) That's it. Josh Book: (23:22) These are really random numbers. You're not very smart. None of you, uh, it it's, it stuck. It sort of struck us though as a bit odd. I thought it would be a hundred percent by the way. Uh, it struck us as odd as it it's, it's 78.5%, uh, reported that they use their wealth advisor to manage their investments. Um, again, I kind of expected it to be much closer to a hundred percent, uh, when you were thought, when it was thought of in the context of, you know, a licensed financial advisor advisor. Um, and it, I guess it's an early indication that people view stakeholders from financial services, um, or they view more stakeholders, sorry, from financial services as being their advisor. So in fact, maybe you are smarter than I thought. Um, some other service breakdowns were, uh, or as followed. So 63.4% of people reported to use an advisor for financial planning, huge opportunity, and there's lots happening there, which is great to see, uh, slowly but surely 31.3 per 31.1%. Sorry, made use of tax planning, uh, 19.2% on estate and legacy planning, 21.3%, uh, used insurance advice, uh, 13.6% on business advising. That's a huge area of opportunity for the wealth space, I think. Um, and I wish Rick was here, Rick Edelman from earlier, uh, 11.9% use an advisor currently to buy or sell crypto. Um, I don't know if you think that's surprising or not, it is what it is, Phil Darling: (24:54) But keep in mind, that's out of the 33% that have an advisor, right. It's not the 10% in general, Josh Book: (25:01) Right. So thinking about satisfaction. So are people satisfied with their advisors? Yes. Uh, overwhelmingly, uh, people are quite satisfied with their advisors at an overall level or net level, um, and really strong score scores, so good job. Um, but let's take a look at some of the elements of an advisor led service that people are most satisfied with. And, and let's unpack if there's some opportunities. So people are, are particularly satisfied with their advisor's, um, extent of financial knowledge, uh, ability to communicate over phone ability to communicate in person response time for inquiries, uh, and the quality of investment recommendations. So those are all kind of the things that you'd think is probably core in delivering some service. Um, so again, while overall levels of net satisfaction for components of a traditional wealth advisor, relationship, service remain really high. I think there are some areas, uh, to focus on, especially when you start thinking about kind of more macro service trends and consumer expectation. Josh Book: (26:05) So two things jumped out out to us, uh, this year, you know, again, still fairly high in the, in the moderately satisfied column. Uh, but the ability to understand my complete financial picture dropped actually the most year over year of any of the, of the elements over 5.5%, uh, which is a pretty significant number, uh, was a, a red flag for us, um, a critical service element of, uh, for wealth management firms to differentiate on, I think in, you know, firms that do well on personalization service elements will drive this client factor positively, which of course will drive, uh, more referring clients, uh, and overall loyalty. Second, um, the idea that people were least satisfied with, uh, educational, um, content and information that they were getting. And then the use of digital technology to enhance services is really more evidence that these businesses need to modernize the way they engage with customers. Josh Book: (27:05) Um, there are the areas where there's the most opportunity, uh, for firms to lift client satisfaction, I think, and I don't think we're talking about looking in the education one, we're talking about, you know, more client events and sling in bagels and fact sheets. Um, I think we're talking about building tools that can deliver relevant information, which promote actions in a modern way. We imagine the use of a digital planning experience that it, that adapts and evolves with customers. We imagine like almost a family office style of managing clients' financial lives delivered and administered in ways that the clients choose perhaps more digitally for one or more human interventions for another, uh, or even that changes over the life cycle of a cus of a customer. But the key point is that the delivery models become more client driven and adaptable. Um, and that's where, you know, the future I think is going so look, general satisfaction scores are directionally helpful, certainly. Um, but it's interesting to measure the, the levels of importance a particular variable has on overall satisfaction. In other words, what are the specific drivers of satisfaction and promotion Phil, do you want to, uh, explain a little bit about how, how we do that? Phil Darling: (28:22) Sure. Um, so this is the most exciting part of the talk, uh, driver's analysis. Uh, it's a very popular technique in applied marketing science, uh, at the most basic level. It's just about the correlation between some driver variables and an outcome of interest. Uh, it's also referred to as derived importance analysis, meaning we're using a statistical model to, uh, determine measures of relative importance. Um, in this case, we're gonna use driver's analysis to look at, uh, relative importance across those dimensions of satisfaction that Josh was just describing, but in relation to two key loyalty measures. So overall advisor satisfaction and advisor recommendations or net promotion, um, conceptually the idea is if an advisor can improve performance on those drivers that have a strong correlation with the outcome, then over time, they'll expect to see improve scores overall on those outcomes. Um, so to run our driver's analysis, this is the really fun part. Phil Darling: (29:12) Uh, we use a computational form of regression called LMG. Um, it's just named after the authors who created the technique. Uh, we don't have to go into the technical details. Um, but if you're having trouble sleeping tonight, I can just send you the paper. Uh, one of the, one of the goals in driver's analysis is to explain variability in an outcome. Um, so LMG is one of these techniques that deconstructs variance, uh, to accomplish that task. And if you've ever taken a regression course, you remember this idea of R squared being a statistical quantity that just describes the variance in the outcome. Uh, that's explained by the regression model. So all LMG does, uh, is determine the portion of explained variability that's attributed to each driver. So you have a very nice share of importance interpretation that comes out of it, um, that you can compare drivers with. They, they sum do a hundred percent, which is intuitive for most people and a driver with a score of 10% can be said to be twice as important as a driver with a score of 5%. Um, so in terms of our reporting, we use this technique as a way to monitor changes in driver importance over time, so we can help our clients, uh, continue to do better, uh, do do well on what matters most. Josh Book: (30:15) I hope everyone's still awake. Um, it, it wouldn't be responsible of data nerds and strategists like us not to have at least a couple of eye charts, uh, for you. So here's kind of the first one. Um, so what's driving satisfaction in, uh, an advisor relationship, um, kind of no surprise on the, on the sort of the top half of the, of the bar chart. But if you turn your attention to the elements which hold lower, lower levels of satisfaction driving, um, you see components that we think can totally be solved for by with technology and, and sort of shifts in operating models. Um, you know, look at the bottom one use of digital technology to enhance services, uh, as an example, you know, but the fact that they're not currently more important, drivers of satisfaction kind of comes in conflict with trends. Um, you see customers are becoming more and more impatient with services that contain friction in the experience, but when it comes to people evaluating their advisors, there doesn't yet yet seem to be much expectation for the use of digital technology to enhance services. Josh Book: (31:25) But I think we, we will see that change I'm being facetious. It that is going to change. Um, and you'll see that element rise in importance over time, particularly as competitors bring more modern advisor experiences to customers and another, you know, key point in why we need to modern monitor these things over time, they change. I can give you very specific example in some of our earlier studies of digital advice, consumers placed a great deal of importance on the onboarding process, um, as a contributor to, as a contributor to their satisfaction. But as that became more of a table stakes contributor, uh, table stakes, part of the experience, it has reduced an importance where being educated and a more personalized experience has elevated an importance. So it's important to keep, keep, keep tracking these things and understanding their context within, within the, the customer journey. Josh Book: (32:21) Um, a fairly similar story in terms of, uh, what are the more important drivers for a client's likelihood to recommend their advisor. Um, as we saw for satisfaction, this is the recommendation. Um, we notice people always want to talk about, um, how great their portfolio is. Although I doubt anybody's saying anything now, um, we also noticed that fees have elevated importance to recommend a I'm getting a great deal. Uh, that's always a popular thing among amongst consumers, but again, we see more evidence that delivering a, a more modern customer experience is gonna remain a key battleground, uh, for growth. Uh, it's here, the use of di notice the use of digital technology to enhance services is elevating in importance, uh, for recommendation. And you recall just a moment ago that the El this was the lowest lowest on, on the satisfaction drivers yet it's somewhat more important as a driver to recommend. So this is telling us that it's a leading point of differentiation. Holy, this was a really cool digital, you know, experience that I got with my advisor. And they're gonna talk about that. Um, so as ever, we gotta keep monitoring these loyalty drivers and assess the data in the context of overall consumer trends. Josh Book: (33:39) So this clock is, I don't know, I, I had cocktail hour at five, and so we're like four minutes over that already. Um, but I wanted to finish on, on intent to engage with an advisor, cuz I think it was important information. Um, and it won't be long cuz I'm super thirsty, uh, more than I'd have. It's unsettling that more than 52% of people don't aspire to work with a financial advisor at all. Um, well we might think that the, well, most of the general public won't qualify for, for the attention of a full service fiduciary advisor based on their assets anyway, um, I think the sentiment remains an important touchstone that we gotta consider. So I'll tell you, um, over 50% or just over 50% of people with investible assets greater than 500,000, say they definitely or probably will not engage with a financial advisor. Josh Book: (34:39) Um, aside from cost, people are saying they simply don't want or need a financial advisor, another sizeable chunk of people report to be comfortable managing their finances. So I mean there's battle and there's lots of ways that people can engage, uh, with wealth management. Now information's more accessible, it's easier to do things. Um, so we really have to focus on how we deliver service, uh, in the traditional channel, but also leverage technology from other channels and maybe have them cohabitate together and coalesce, uh, into a more fulsome service. That's that's more personalized. Um, if anything, over the last six or so years of studying consumers in the wealth context and helping firms make choices, um, it's imperative to place heavy, heavy focus on customers, you know, who are your customers that you wanna serve? Why, why have you chosen them? Uh, what are their needs, not just now, but in the future, the things that drive them to be loyal customers today most likely will not be the parts of your value proposition that will drive loyalty in the future, uh, either for your existing clients, but also for the, your future clients. So with that, I mean let's have a drink thank you very much for joining us. We really appreciate it.