When we published our research paper on the future earlier this year, we had no idea how quickly everything would change as a result of COVID-19. But the truth is, the trends we predicted continue to influence our industry unabated. In many cases COVID-19 has, in fact, just accelerated change. Here we outline what these broad trends mean for you – the Advice industry, and we unpack what you can do now to make the most of the change and not get left behind. If there is one thing that is always true it’s that change in inevitable.
Trend 1: Client engagement and advice delivery will align to evolving demographics and needs.
To date, most of your clients have probably been baby boomers. Now gen X, Y and Gen Z are likely to become the predominant forces within consumer markets. These generations grew up with the internet and have different expectations. COVID-19 has actually accelerated these preferences and embedded them as part of BAU. So, here’s your checklist…
- Do you have video conferencing? And do you know how to present online?
- Do you know how to leverage personalised data to create a bespoke pitch to your potential client?
- What options do you have for new business to get in touch or renew? Chat, email, phone, Calendly, a variety of social media channels?
- What is your social media presence like? Are you engaging fans and followers and building an online reputation?
- What happens when price and product aren’t the only considerations? How will you manage clients who are interested in understanding the ethics of all companies you are recommending?
- What do you stand for? We are in an era of social movements like #metoo and #blacklivesmatter – your stance on social issues may come into play… is your business carbon neutral (for example).
Trend 2: The market will fracture as new client-centric business models emerge.
In order to continue to justify commissions or even a fee for services, Advisers will need to demonstrate the value of their advice and the bespoke personalisation of it. You can’t provide personalised advice without an in-depth understanding of your client and their goals. So how do you do this while still maintaining a margin through a discovery or ‘getting to know you’ phase? Here are some things to think about…
- How automated are your questionnaires and on-boarding processes? Can you connect via an Application Programming Interface (API) to other sources to create unique offerings and easy applications? Eg: Facebook, LinkedIn, health records.
- Have you got a one-size-fits-all approach to customer engagement? Or do you have packages based on understanding key requirements of segmented audiences and customers?
Trend 3: Fee transparency and versatility will be vital for fostering client trust.
Commission or not, clients want transparency. Not only in the price they’re paying and why, but also what the Adviser is being paid – and why…
- Do you have a flexible fee structure or are you completely reliant on commissions? Are you charging for time or expertise? And, can you clearly articulate the value you add?
- How do you demonstrate ongoing value for money? And how do you ensure you have ‘clients for life’.
Trend 4: Artificial Intelligence (AI) and other emerging technologies will enable advisers to deliver advice and insurance more effectively.
- What does your business look like when all the number crunching, cost-saving and goal planning recommendations are so quick and easy you can no longer charge purely for them?
- What opportunities does AI give you to create even more bespoke offerings?
- Do you have a robust technology backbone with an API so you can securely ‘plug and play’ with other companies to create new offerings?
Trend 5: The emergence of ‘new age’ advisers will see an inter-generational adviser workforce share skills, knowledge and experience.
- What is the diversity of ages, backgrounds and skills across your business like? Or how do you tap into diversity within the community?
- What do you and your brand stand for? Do you have purpose beyond profit?
- How does your business share ideas and promote innovation?