Client engagement is one of the key issues in the financial services industry currently with advisers looking for ways to better work with their client base.
One of the main challenges with improving client engagement is the time it takes to service every person on your books.
Particularly with lower-value clients, face-to-face meetings can be financially unviable.
The trouble is, every client on your books expects the same level of service. A ‘D’ class client doesn’t know they are ‘D’ class and they certainly have ‘A’ class goals.
Generally, financial services professionals think of ‘engagement’ as telling and giving clients what they need, rather than what they actually want – peace of mind, security, confidence, support and understanding.
When was the last time a client called you and said: “I’d like an investment portfolio that generated CPI+3 per cent as I believe I have a moderately conservative risk profile”.
All of us in financial services understand the importance of giving clients what they need and it can be difficult to consider that what they want won’t always align or may be difficult to provide, particularly from a client services’ point of view.
The generational challenge
Even more challenging is meeting the wants and needs of different client demographics, especially between generations where their goals can be vastly different.
Looking at the three generations currently in a position to need financial advice – Generation Y, Generation X and Baby Boomers – each has a different expectation of the advice they receive.
For Baby Boomers, they are looking to maximise their retirement savings to live comfortably when they finish working. Gen X might be aiming to pay off their mortgage and start thinking about retirement planning, while Gen Y is likely more concerned with maximising their savings for a house or holiday.
Each of these requires a very different investment approach.
The digital solution to engagement
The rise of digital advice has flipped the client relationship on its head.
Robo-advice and other digital solutions put more control in the hands of the client than ever before, allowing them to tailor their advice based on their wants and needs.
For each generation, it allows them to dial up and down their advice, tailor their investment strategy to match their life stage and give them more visibility on their finances.
Clients want information, education and to understand their choices so they can achieve their goals. Digital advice offers an easier, more economical for all this to be delivered digitally.
Different digital tools will appeal to each generation and these can include:
- Financial goal setting and budgeting
- Simple investment advice
- Basic portfolio management
- Financial assessment and goal adjustment
- Retirement planning
- SMSF appropriateness assessment
- Insurance advice
- Risk assessment
- SMSF advice
- Estate planning
- Wealth transfer planning
- Cash flow projections and management
The benefit for advisers
Beyond the time-saving benefits of a digital advice solution, the ability to offer a branded advice portal to clients increases their perception of you as an innovative practice.
Most importantly, you maintain the client relationship; everything is controlled by you and you maintain full transparency over your clients throughout the process.
Digital advice will not be for everyone and, particularly for your higher-value clients; face-to-face meetings will still be important to both the relationship and to maximising their investment performance.
A digital platform allows you to attract and service clients more easily and to nurture these relationships early on, even those that typically would have been too low value to be worthwhile.
Ultimately, digital advice allows you to give clients peace of mind, rather than a piece of your mind with irrelevant information.
Richard Liverpool is head of sales and marketing at digital advice provider Ignition Wealth.