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Surviving in the modern jungle

This article is a combination of information contained in a Suitebox presentation titled “The psychology of the modern client” and my own personal experience and observations.

Fifteen years ago, when Moonstone was still a fledgling company trying to keep its head above water, I went to see the marketing director of a fairly prominent asset management company in Durban.

During the discussion, the director indicated that they were quite happy with their existing client base, consisting of investors in their seventies and eighties, and saw no need to expand it via financial advisers.

He seemed a little taken aback when I pointed out that people in these age groups have a bigger tendency to die than younger people.

Taking on board new clients inevitably means that it broadens the expectations they have, and how their needs can best be served.

The manner in which the process of financial advice is conducted has changed significantly in recent times and, quite frankly, has lost its relevance for many clients. It has failed to evolve to what it is that makes clients, for want of better word, “happy”.

It is not only younger clients whose expectations have changed. On a personal basis, my social engagement has shifted very much to a Facebook platform where I can communicate with many real and cyber friends whenever I choose to do so. Many of my friends who are on Facebook regard themselves as voyeurs. Twitter, on the other hand, is too abrupt for me, yet many of my peers swear by it.

Modern engagement is about connections with consumers in ways relevant to what they require at different stages of their life and journey. Modern engagement is about the entwining of those two components into one collaborative path. Modern engagement is continuously evolving. So are we on the cusp of the ‘Second Machine Age’, where software will change the way consumers pay, invest and interact with all service and product providers, and in particular, with financial advisers.

Without the willingness to disrupt our business and engagement model, we as advisers run the risk of becoming obsolete. We will soon be forced to do more than merely engage with clients once a year for a portfolio review. For example:

  • Do you conduct satisfaction surveys with your clients?
  • Do you have your own financial plan?
  • Have you asked one of your peers to draw up such a plan for you and, in so doing, understand the client journey?

The modern client is:

  • looking for value and collaboration
  • for engagement that starts by connecting at very basic human levels: through our senses
  • engagement scenarios that appeal positively to human emotions

If we are unable to deliver, those who can may soon take our place. Loyalty is, slowly but sadly, becoming obsolete.

Embracing technology, rather than fighting it, is the only way to survive in the technological jungle where survival of the fittest still very much applies.

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