By Ryan Beach (CEO of CLS Investments) for Wealth Management
Technology can help manage your clients’ demand for an immediate response to their questions.
How and when advisors communicate with clients is constantly changing. The days of traditional emails and memos are numbered. Gone are the days when face-to-face meetings were the best way to stay in touch. Today, people require instant communication and texting has found its way to the forefront of human interaction—particularly in business. Now, we’re all digital all the time.
Texting and virtual conferences are surpassing phone calls and in-person meetings, becoming some of the most popular forms of communicating. According to a survey from Phoenix Marketing International, more than half of people under age 35 are comfortable managing their finances with mobile tools and downloading apps to oversee their money. Another study from OpenMarket states that 75 percent of millennials prefer texting over phone calls, which means that we need to think about how we communicate in the future, and how the industry’s future client-base will prefer to interact
Virtual communication is only becoming more popular. According to a 2014 survey conducted by Peak Advisor Alliance and Cerulli Associates, 81 percent of participants report speaking with clients in-person only once or twice per year. While virtual communication may never completely take the place of in-person meetings (at least in our lifetime), it’s widely accepted as a go-to solution for meaningful and efficient client engagement.
However, the shift to virtual communication also means a change in response time expectation. Digital interactions and social media platforms—including Facebook, LinkedIn and Twitter—revolutionized people’s expectations around responsiveness, as well as broadened the platforms by which companies engage their clients and customers. Social media is quick, accessible, and has the personal connection that emails lack. However, this also presents a challenge to advisors as they struggle to keep up not only with the technology, but within the bounds of being appropriately and professionally responsive to a client.
What does the evolution of digital interaction mean for advisors? Simply put, no matter what the channel is—texting, email, phone calls, or social media—it’s imperative to remain on the cutting edge of client service, but also to maintain a boundary in order to manage response-time expectations.
Remember Kodak? For the longest time, Kodak was the premier camera and color film company. But they languished when digital photography software and photo file sharing became popular and were unable to keep pace. Their issue wasn’t that they weren’t best-in-class or experts in the industry of photography; their challenge was that new technology disrupted Kodak’s own progress. By the time they took action to catch up, they were already outpaced and outnumbered by the competition.
Amazon, however, is a prime example of a company that you can engage in a multitude of ways and are almost always guaranteed a quick delivery or response; they’re always on the cutting edge of technology. In addition to pushing their employees to service customers, Amazon innovates and is always thinking of the technological advancement that can take them to the next step. They were once just an online marketplace for books. Now, they develop their own products and even produce movies and shows.
It’s critical for the advisor to be in control and have the ability to communicate virtually; accessing innovative technology empowers them to do this. In addition, clients should feel secure in their ability to contact the advisor and ask them questions through digital channels—not just in-person.
To differentiate your firm and ensure that your technology is helping to improve the client experience, here are four tips to guide you:
- Client preference. Find out what their tech preferences are, what methods they like to use to communicate, their preferred ways of interaction, and what cadence strikes the right balance for both you and them.
- Make sure the technology you are using is up to snuff. As technology changes, you’ll frequently need to monitor how relevant your firm’s technology is, and seek clients’ input to help inform its efficacy.
- Become an early adopter. Never be complacent with your firm’s technology, even if clients are content with it. There is always room for improvement, and it’s only a matter of time before the next advancement.
- Set boundaries. Just because technology allows us to be in contact with one another at any moment, it doesn’t mean we should. There need to be professional boundaries that ensure the client/advisor relationship is healthy, striking a good balance, and receiving the right amount of communicating.
As technology evolves, the advisory industry must adapt. Firms must differentiate themselves, but also manage clients’ expectations around responsiveness. It’s time for industry leaders to create innovative solutions to deliver individualized, successful approaches to client success.
Ryan Beach is the CEO of CLS Investments.