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To survive and succeed, advisors will have to disrupt

  • Advisors who hope to compete against disruptors such as robo-advisors will need to disrupt their own client-engagement systems.
  • Engagement includes co-creation, personalization and specialization.
  • A so-called client journey map is both a useful tool and radical thought process that can help advisors rethink engagement.
Financial Advisor Actuary
Eric Audras | Getty Images

When it comes to the much-ballyhooed business of disruption, if you can't beat them, join them — and do a little disrupting of your own.

That was the message to financial advisors unsettled by the rise of robo-advisors and other industry disruptors from speaker and writer Julie Littlechild, speaking at Charles Schwab's IMPACT 2017 confab in Chicago.

According to Littlechild, founder of Toronto, Canada-based firm Absolute Engagement, advisors can themselves become proactive disruptors, too, by reimagining how they interact with current and prospective clients.

"If you're competing against a firm doing all of these things, it would be a challenge if you weren't also doing something similar," she said. "I believe it's the way of the future."

More from the IMPACT Conference:
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The wall of worry advisors are facing
Advisors fighting elder financial abuse

Here are three ways to disrupt the client engagement process to the benefit of both advisors and their customers:

• Co-creation: Feedback is great but advisors need to actively involve clients in the design of their own customer experience from the get-go, said Littlechild. "Instead of talking about what we offer to clients, let's talk about how we can create the experience with them and how that fits into their lives," she said, noting that this so-called co-creation makes possible the next disruption: personalization.

Personalization. Littlechild cited tech firm Apple's customer service approach as a good example of expert personalization. The company's website asks how customers prefer to be contacted: online chat, phone call, or email. If they choose "phone call," they're given a call time. If there's a wait involved after they're called, they're asked what music they'd like to listen to until a rep picks up. ""I think this is how we need to be thinking about service going forward," she said. "We're shifting from the past, when we were thinking more about standardization, and saying that no, while we want some efficiencies, we're trying to personalize."

Specialization. Advisors may want to deliver extraordinary service to each and every client in a very diverse customer base, but it's nearly impossible. "The only thing they really have in common is that they work with you," said Littlechild. "We can deliver good service but we can't create something that is really deeply meaningful and differentiated around the needs of absolutely everyone."

"The question we're asking is how the advisor's offer fits into the journey the client is on. You play a role in that, an important role, but it's not just about you." -Julie Littlechild, founder, Absolute Engagement

"If we're really thinking about co-creation and personalization, it's going to push us down the path of asking whether we need to have a more defined focus in our client base if we want to deliver a client experience that's both deeply engaging and extraordinary," she added.

So, how do advisors get to where Littlechild recommend they go? A process called the "client journey mapping" can help, she told IMPACT attendees.

"The question we're asking is how the advisor's offer fits into the journey the client is on," Littlechild noted, adding the most important thing about journey in question is that it's not about working with a financial advisor and often begins long before initial advisor-client contact.

"It's the journey of maybe planting their financial future, or their future in general," she said. "You play a role in that, an important role, but it's not just about you … [or] what you deliver."

A client journey map can be an actual worksheet that provides a single view of the client experience through "the eyes of the clients who are exactly right for your business, using his or her motivations and challenges to trigger opportunities to engage and to innovate." Points along the map to analyze include: awareness, initial contact, onboarding, plan creation, reviews and ongoing communication.

Littlechild recommended a four-step strategy advisors can adopt to begin disrupting their client-engagement processes:

  1. Define an authentic niche. Who are you designing the client experience to support? Your niche could be one type of client, or one type of service you provide exclusively. "When advisors describe target markets, the two most common responses involve 'wealth' and 'age," said Littlechild. "That's an 'ideal client' description, not a niche. Niche is how clients describe themselves."
  2. Actively involve clients. Don't ask what you should offer; ask what a client's most extraordinary customer service experience ever looked like — and then try to "close the gap."
  3. Create that client journey map. Under each point of the client relationship timeline, you can list topics such as actions, questions, feelings and concerns, information needs and touchpoints.
  4. Innovate. Figure out how communications, processes and business must change to fit your client's journey. "We want to see a direct connection," she said. "That's how we create a great experience."

Littlechild presented a case study of a financial advisor who studied a client's journey map and settled on the onboarding process, a time when new clients might have many questions, as a focus. First, when clients first came onboard, they got a letter from the firm's owner. Second, a client services associate phones clients one week after onboarding, even if there's nothing to report, to check in and field questions.

Next, advisors walk clients through their first statement, because people are often afraid of appearing ill-informed and won't ask outright. Finally, three months after a new client comes on board, they send out a one-page, 10-question survey about the transition.

"To boil it down, they looked at the client journey map and asked what clients were experiencing — not what they themselves were doing and how they could design a new process to support them," she said.

Littlechild noted that she found that clients transitioning to retirement seem to have the most concerns about health and health care.

"So getting a market update, I'm afraid, isn't that connected," she said. "But what if you had a speaker come in who's an expert in health and wellness for people of a certain age?"

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