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Wealth Management in the New Roaring 20s: 5 Emerging Trends

February 16, 2021

By Jim Palumbo, Dynamic principal and chief development officer

In the past 10 years, business owners around the world have experienced extraordinary disruption from technological innovation and the rapidly shrinking cost of transactions, forcing many to evolve their business models. Very few businesses were in the cloud a decade ago, but now there is a stampede to move business systems and processes to a digital model. Social media went from being a curiosity to one of the most effective networking and advertising platforms ever created.

These trends were dramatically accelerated by the pandemic of 2020, forcing many businesses that had previously resisted online engagement to swallow the red pill, and step off the precipice of the familiar and into the 21st century digital age.

While all this techno-soup was being digested, it initially appeared that the result of this tidal wave of innovation and efficiency was going to be a low-cost focused economic model. To the surprise of many, however, the abundance of investment capital and disposable income shifted the consumer trend from cost to value. In a near zero-cost transaction environment, consumers are seeking more: They want more value, deliverables, convenience, clarity and a better customer experience.

In the world of wealth management, these shifts in the business environment and consumer behavior reveal five emerging trends as we burst into this new decade, the 2020s, with a remarkable combination of geo-political, public health and economic events, setting headlines ablaze:

  1. Holistic Wealth Advice
  2. Digital Communication & Engagement
  3. Valuable Traditional Engagements
  4. Customer Journey & User Interface
  5. Exemplary Touchpoints

Here, we explore each trend and provide insights for your practice as consumers are faced with making decisions in an increasingly complex world:

1. Holistic Wealth Advice

is evolving into the core service provided by professional wealth advisors. Asset management has long been the primary service offered by the most publicly visible advisors. While competing with the stock and mutual fund pickers of the late 90s and the allocators following the stock market collapses of 2000 and 2008, financial planning gradually became more fashionable in the 1990s.

Thus, the CFP™ designation became more ubiquitous over the next three decades. Curiously, there is less meaningful planning actually taking place for consumers today than implied by the frequency of the word “advisor” on business cards. Too many advisors are still resting on a somewhat rusty investment management business model. The consumer’s appetite, however, is trending toward a holistic wealth advice business model.

Asset management as the core service in an advisory practice represents less value to consumers than it did 10 years ago. The automation of asset management and the dominance of passive investing are two of the factors driving customers’ migration to holistic wealth advice. In addition, customers are faced with making decisions in a more complex world. This implies the consumer is willing to pay a fair price for intelligent advice, consulting and guidance.

According to TD Ameritrade’s 2019 fa insight white paper, “Pricing to Reflect Your Value,” the data suggests there is no fee or pricing compression in the RIA space, particularly for advisors who are providing holistic planning. From emerging to enterprise level practices, advisors should be evaluating their service levels and value narrative to be sure they are providing the right mix of advice for their unique client segments.

The public is starved for what you can provide: wisdom, insight, analysis, information, planning, aggregation, and comprehensive, cohesive views of their financial life. Give them what they want, and you may see your business grow.

As a result of consumers’ appetite, there’s been a great deal of planning at Dynamic for resources and tools to better position practices to add more in-depth services.

2. Digital Communication & Engagement

is dominating the world of professional services. During the pandemic, many professionals were unable to visit with their clients in person. In some areas, that’s still true. The emerging theme here is not that you’ll never see your customer in person again, but it’s certain you will see them less.
In addition to the realities that the pandemic forced upon us, customers’ schedules are becoming fuller in general. People are busy, and a digital engagement with you is often more convenient than driving to your office. The internet closes the time-space gap. Many interactions having migrated to the web, and it’s not going to slow down.

In 2020, people around the world discovered Zoom, and suddenly all the curmudgeons that told me they “run their practice on handshakes and face-to-face meetings” and “don’t need any newfangled internet novelties” found themselves scheduling video conferences with their clients.

In addition, social media has emerged as one of the most efficient and effective marketing tools ever created. People who once dismissed social media are now faced with the reality that it’s a primary way to reach eyeballs today.

Dynamic has worked tirelessly to create communication, community, marketing and development integrations, as well as an administrative cloud that helps advisors conduct business seamlessly from the real world to the virtual world.


3. Valuable Traditional Engagements

“I’m not going to stop seeing people in person,” say many of the business owners with whom I consult. And this is true: In-person meetings aren’t extinct. However, many American workers may never return to a traditional office environment.

Virtual meetings, conferences and seminars will replace many of the traditional in-person connections of the past. The latest Dell™ television commercial shows the customer service representative taking a client call while seated at a desk in a home office, steaming cup of coffee on the desk with a view of the park out the window. Remote work has become not just the norm, but cool! So, how do we make meaningful human connections in a digital world?

Co-browsing might be a bridge between digital and physical worlds.

Dynamic recently introduced tools with help from its partners that allow advisors and clients to share control of the onscreen video conference while sharing a screen. This co-browsing experience is more than one person (usually the advisor) sharing their screen cluttered with pie charts and mountain graphs. Instead, both the advisor and client get to share the screen while interacting with the content on that screen (usually the client’s portal page).

This comes complete with audio and video. The advisor is sharing access to asset reporting, financial planning, documents, audio, video and chat all on one screen—live with their client. The customer doesn’t just look at the screen, they are able to interact with it. This could be the future of virtual meetings—making them more personal and fully interactive for both advisor and client.

If traditional meetings and customer engagements are decreasing in frequency, then their importance is increasing. If you’re seeing your client less frequently, or having fewer tangible deliverables, then those physical (non-digital) touchpoints need to be impactful.

When you do provide a physical deliverable, make it count. Printed reports should look like a presidential decree. Perhaps try including a branded flash drive with quarterly reports.

In-person meetings should be as well staged, planned and enjoyable as possible. Rethink your physical office space. Visualize a smaller physical footprint where you are outsourcing your administration to the cloud—rather than housing administrative staff and equipment in an office—while making the new, smaller office the most enjoyable place for customers to visit.

After all, the golden rule of real estate is to buy the smallest space in the best building, rather than the largest space in the cheapest building.

4. Customer Experience & User Interface

The Customer Experience (CX), or customer journey, is gradually synthesizing with the User Interface (UI). Every touchpoint impacts customer journey. More than ever, those touchpoints are digital, or a user interface, i.e., they are connecting with your businesses’ cloud presence via a device. An Accenture report, “Moving beyond CX to the Business of Experience,” cites:

“The powerful convergence of marketing and technology in today’s marketplace means brands are no longer built through advertising, but through experiences. We connect deep human and business insights with the possibilities of technology to define and deliver new realities. Experiences that can make lives easier, healthier, safer, more productive and rewarding.”

To unlock their potential, maintain relevance and elevate their practice, wealth advisors need a professional services partner that is more than administrative support, but also a consultant, marketing coach and tech leader. At Dynamic, we’ve had to be forward thinking to stay ahead of these changes and shifts in customer service, and we love sharing our experience with our clients.

The customer experience, according to Andre Schwager and Chris Meyer in the Harvard Business Review, is the customer’s holistic subjective perception of their experience with you and your business, from finding you online, navigating your website, talking with someone in your office, to receiving the service for which they are paying you.

Understanding and managing the customer experience is no longer enough; it’s now necessary to deliver incredible experiences. As the efficiency of low-cost allocation models is dominating the investment universe, the value of picking stocks and funds is decreasing while the value of providing clients an extraordinary experience through aggregation and planning, as well as coaching and consulting, is overtaking traditional pie chart practices.

User interface design anticipates the customers’ preferences and creates an interface, the point of human computer interaction and communication, that both understands and fulfills those preferences. In a broader sense, it refers to the touchpoints with which your customer interacts with you since many of those interactions are now digital. Those interfaces, interactions and touchpoints should be simple, elegant and satisfying.

5. Exemplary Touchpoints

When I started my RIA, I bought Crane’s Crest™ cotton stationery and stock for letters and reports. It was the most expensive I could find with thick cotton report covers and translucent fly sheets. I sought these out because I wanted the customer’s tactile experience to be as gratifying as possible. The things they saw and touched were imbued with the same quality of the advice and asset management they received.

I also worked my way up to a big office with high ceilings, marble flooring and stylish glass offices to create a 360-degree experience that was sophisticated and engaging. Predictably, the physical assets like report covers and marble lobbies I strived for years to achieve are being replaced by digital assets.

My friend Flip Pallot, a renowned outdoorsman, started his career adventure as a fishing guide in the Florida Keys. I noticed that the grab rails on his boat, which were already made of polished stainless steel, were wrapped with rope, but not just wrapped—they were wound in an ornate design that was not only beautiful, but also pleasing to the touch. When I asked Flip about the windings on his stainless rails, he replied:

“Early in my guiding career, I realized that many of my clients were traveling long distances, sometimes 1,000s of miles, to fulfill a life-long dream of fly-fishing for Tarpon in Florida.  Sometimes they were paying me all the money they had in savings to fulfill that dream.

“Because of that, I made up my mind, that everything they laid their hand on would be perfect: the grab rail, the fly rod, the seating, the lunch—everything. I even hand-carved the fork of the push pole from a mangrove root so there was a story to go along with the most rudimentary tool on the boat. I wanted their whole experience to be perfect.”

Flip forced me to ask myself, do I provide my clients a perfect experience? The goal of focusing on and refining the user touchpoints is to elevate the customer experience and therefore, elevate your practice. Craft the connection points along the customer journey so that they are flawless.

Are the points where you connect with and touch your client perfect? Are those touch points graceful, engaging and aesthetically pleasing, and dare I say…fun? Investors can obtain good model portfolios online at no cost. Their relationship with your business should be eminently more satisfying than a model portfolio.

To be irreplaceable, 21st century wealth advisors need to provide exemplary touch points in addition to the core value-adds of holistic planning and investment management if they are going to differentiate themselves. In the 2020s, many of these touchpoints are likely to be digital. Ask yourself:

  • Is my website or client portal interactive?
  • Is it easy to navigate and login to the portal?
  • Is the user interface simple and elegant?
  • When a client Google’s my or my firm’s name, are they easy to find?
  • Is it easy to understand what I do?

Here are some examples: For many businesspeople, when someone searches for them online, the two top search results are their LinkedIn page and Google business listing in the right sidebar. When a stranger searches “financial planning near me,” and finds those two results, can they understand your brand promise and value proposition at a glance, or do they need to click multiple times and read through a lot of text to gain a rudimentary understanding of your narrative?

Many LinkedIn and Google listings are incomplete, and consequently, give the impression of unprofessionalism. You can start with these two, and then work your way through your website and social media accounts. Put yourself in your customer’s shoes and visualize what it’s like to interface with you. There are plenty of competitors that provide the same core services you do—differentiate yourself by creating exemplary touchpoints.

It’s easy to up-your-game if you put yourself in your customer’s shoes. Look to your favorite interactions with businesses from whom you buy for inspiration.

At Dynamic, we are proud of the work our team performs in creating and delivering a unique and compelling experience for the advisory practices we support: a comprehensive business system and suite of professional services from “A to Zoom” that provides our business owner clients with the tools and support they need to deftly surf the tidal wave of trends preceding the new Roaring Twenties. By bringing these elements together, our advisors can provide their clients with the services they’re earnestly seeking—and the experience they’ve come to expect.