Is the Ritz Carlton worried about the Motel 6 next door? Then why are you concerned about Robo’s?

“We’ll leave the light on for you.”

Not quite the tagline you build a customer service book around, and it’s in sharp contrast to the 5 star (maybe 6-star, depending on who you ask) service one comes to expect when ponying up the cash to stay at a Ritz Carlton.

More and more articles and chatter continue to swirl around about the delivery of financial advice through Robo Advisors.  While I agree they have been very successful in gathering assets and appealing to Millennials, I hesitate to jump on the bandwagon calling for an end to the human financial advisor.

Should we ignore this new trend? Absolutely not.  It is teaching us something about the way the next generation chooses to receive information and begin their journey of saving money.  The message is to gain access to this “YouTube” generation, give them the information on-demand and provide the technology they have become accustomed to.

But think about it in the context of the value you provide to your clients.  If you are purely a place for them to go execute trades, or are the lowest priced option on the block (the Motel 6), then yes, you should be prepared to compete head-to-head with this new competitor.  Motel 6 has several direct competitors trying to provide better free coffee and lower room rates, but I imagine Ritz Carlton is not high on their focus list of competition.

What about the advisor whose true value to clients goes well above product, price, and performance?  What about those advisors that are effectively utilizing the intellectual capital they have created to guide clients through the emotional side of investing?  What about those having discussions that get at the heart of an investor’s feelings about money? What about those spending the time and resources to help clients reach short and long-term goals?  Now, that’s going well above free coffee and slow Wi-Fi.

In a commoditized product-based business you need to stand apart.  You need to focus on your unique ability.  At times this is can be hard, especially when most conversations start like this:

Advisor: “Hi, my name is John and I am a financial advisor”.

Client: “Oh great, what do you think about these crazy markets? Should I buy Facebook? My brother says it is way overvalued, but I see it keep going up.”

You need to shift the conversation. You need to focus on your value.  If your value is helping people understand the technical aspects of the market, and you are a great money manager, that is your lead.  If you are an outlet for clients to have conversations with, where they would otherwise not know where to turn, lead with that.  If you are focused on helping address specific goals, retirement funding, college funding, etc., use that.

Flip the conversation with the client and help them with things they couldn’t get anywhere else and couldn’t replace with technology.  You are the value chain. You drive the relationship.  Open with more than “I am a Financial Advisor”.  Talk to people about how you help them organize and understand their finances.  Let them know how you lead business owners through the different phases of being a leader of an organization.  Tell them how you can help them have the conversation with an aging parent.  Explain how you can work with the other professionals in their life to make sure their “one life” has “one plan”.

With this new technology, will the story be told in a different way? Absolutely. With this new technology, will your value proposition have to be more than calling with a hot product idea? No doubt.  What it doesn’t change is that fact that most Millennials, Boomers, and Generation X,Y,and Z-ers still need someone to turn to when faced with making financial decisions.  If they don’t, they shouldn’t be paying customer of yours.

Picture yourself as a surgeon in the operating room.  The patient rolls in and sees the table full of surgical implements you have out ready to perform the procedure.  Here’s the one thing you are guaranteed to never hear from the patient: “Thanks, doc. Now that I see all the tools I need, I’ve got it from here.”

Or better yet, remember that there are people out there who understand the value of great service and access to a smart, professional staff. They are not walking down to street looking to spend the night at the cheaper option just to save a couple basis points.




Chris Sullivan sm

Chris Sullivan
Branch Development Director
Horizon Wealth Management

Chris’s primary areas of focus are practice development, acquisition, and succession planning as the Branch Development Director for Horizon Wealth Management. He concentrates his efforts on helping advisors grow their business by maximizing communication with clients and peers, leveraging the benefits the firm has to offer, and staying apprised of practice management trends in the industry.

Chris began his career in the securities industry in 1999 in the sales and marketing department of a securities firm. Prior to joining Horizon Wealth Management, Chris spent nearly three years at Cetera Advisors following a six year career at Pacific West Financial Group. He uses his background as an independent financial advisor to help advisors leverage their relationship with Horizon Wealth Management to grow their practices.

To Contact Chris:
425-691-8773 | phone      Send Chris an E-Mail