I took my bike for a tune-up recently and struck up a conversation with the owner, Scott. When the pandemic hit, demand for bicycles doubled. Bike shops sold out. Manufacturers have scrambled to catch up and production has been plagued by supply-chain interruptions.
I asked Scott how the business was doing without being able to get new inventory to sell. I could see they were still busy doing repairs and selling parts and supplies.
“Our biggest problem is Amazon” he said. When the pandemic hit and all the stores had to close, a lot more shopping went online. After a few months, people adjusted their expectations to Amazon Prime’s brand promise – whatever you want, day after tomorrow.
Scott described customers calling up asking for new bikes or modifications to their current ride. Two years ago if he responded that they could have the parts in three weeks to do the work, that would be fine. When he says that now, people are outraged.
Two years ago, when we asked client advisory boards about meeting by videoconference, reception was lukewarm. There was some enthusiasm in areas where traffic is particularly bad or clients were distant from the advisory firm. But overall clients preferred to meet face-to-face.
The pandemic changed that. When the only way to see your advisor was by Zoom or Skype, everyone got on board. They discovered the experience was okay. Over the last six months as we conducted our advisory boards virtually, we asked what role videoconferencing should play once restrictions were lifted. Most advisory boards indicated they wanted it to be a normal part of the relationship. Some clients indicated a preference for meeting virtually all the time but most wanted to see their advisor possibly once a year and meet by video the rest of the time.
The last year has changed client expectations. We spent a lot more time with Netflix. And every time we bring it up on the TV, we are presented with a customized list of recommendations based on what we have watched previously.
A trending conversation in financial services is what risk massive tech firms or retailers pose to advisors. The perceived threat is a new Robo advisor or virtual CFP. Whether or not that kind of competition arises, you already compete with Amazon, Netflix, and other mass personalized services.
Even before 2020, we were living in a progressively customized world. Last year just accelerated the trend. Firms that keep in touch and adapt to changing expectations will attract more clients. Advisors who retreat to their older, more comfortable ways of doing business will find it harder to compete, especially for the next generation of client.
Here are two things you can do to remain relevant: test new ideas with clients and co-create the experience.
Seek guidance from clients
Ask your advisory board how their habits have changed over the past year. Ask them about the best customer service experiences they have had. Dig for clues to upgrade your experience.
Develop ideas to customize elements of your service. Have your client advisory board critique and modify those ideas.
Co-create the experience
Find ways you can customize the experience to individual clients. How often do they want to meet? And how many of those should be in person, by video, or by phone? What do they want covered in review meetings? Do they prefer being contacted by phone, email, or text? Do they want detailed portfolio reports or summary reports?
Create a questionnaire that becomes a standard part of your client onboarding. Provide each client with a semi-customized experience.
The pace of change is accelerating. Keep in touch with developing client preferences and enlist your clients to co-create the experience to stay relevant.