TOPIC // Advisors

Dial Up Client Engagement to Succeed in Volatile Markets

It’s easy to imagine yourself to be quite the sailor when the sun is shining and the sea is calm – but when a storm blows in, many people who thought they could handle their own ship will decide maybe hiring a captain isn’t such a bad idea.

In a period of rising interest rates, market volatility, talk of recession, extensive central bank action and conflicting signals, the expertise and personal connection of a human advisor provides value to clients. In 2021, following the market disruptions of COVID, a survey found that 26% of Americans said financial advisors were their most trusted source for financial advice, compared with 22% in 2020. That 4% increase put financial advisors at the top of the list, bumping down “Yourself,” which went from 30% in 2020 to 20% in 2021.

Another survey by the Employee Benefit Research Institute found a marked drop in the number of people who relied on online resources and their own research for retirement planning advice, from 35% in 2021 to 29% in 2022, matching those who rely on professional financial advisors (which held steady.)

While robo-advisors and do-it-yourself investing get a lot of press, human financial advisors offer things no digital solution can. Many of these things are more emotionally driven: according to a recent Vanguard report, these include peace of mind, a perception of greater value added to their portfolios, and more nuanced personalized advice and broader financial planning services.

88% of robo-advised clients would consider switching to a human advisor
That extra value is seen in the loyalty and consideration numbers found by Vanguard:
“While more than 90% of human-advised clients say they would not consider switching to digital, 88% of robo-advised clients would consider switching to a human advisor in the future.”
Taken together, these facts indicate that volatility might actually provide an opening for advisors to attract and retain clients. While the technology behind robo-advisors isn’t going away, what appears to be emerging is a hybrid model that blends the efficiency of digital tools with the emotional support and trust that a human advisor provides.
Earning customers’ loyalty through ongoing client engagement
That trust isn’t given lightly, however. Advisors who want to tap into the needs of clients who are looking for peace of mind and support need to know their clients and their clients’ situations on a deep, personal level, and need to build a relationship by connecting frequently with relevant information or even just reassurances. This client engagement is time-consuming work, but often the most fulfilling.
The best tool to help advisors make those kinds of connections is an Integrated Advisor Desktop like that offered by NexJ. By bringing together personal information from a CRM, market information, relevant news and trends matched to the client, and advice and reminders
on when to connect, an IAD helps enable and foster better personal relationships between financial advisors and clients, often using the same kinds of technologies that make robo-advisors work, such as artificial intelligence and data mining. With that information at their fingertips, advisors can add an additional layer of refinement to tailor it to their clients, and deliver the information with the empathy and reassurance clients seek.
No one knows what tomorrow will bring in terms of markets and economic volatility. But with the right tools, any headwinds can be captured to help fill the sails of financial advisors and their firms.

If you’d like to learn more about how NexJ’s Integrated Advisor Desktop and the Nudge-AI Suite can help you serve your clients better and run your business more efficiently, contact us today to book a no-obligation demo.

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