Podcast: Play in new window | Download | Embed
“Maybe it’s just me, but I feel different at this moment than I did yesterday. Things change, the context changes. I think this has raised an interesting challenge for advisors, how do I gather data from my clients that is in the moment and can support a deeper conversation?”
— Julie Littlechild, Founder and CEO, Absolute Engagement
Click here and schedule a Discovery Session to find out how Ezra Group can help your fintech firm grow revenue in the wealth management space.
The WealthTech Today podcast features interviews, news, and analysis on the trends and best practices in wealth and technology for wealth management, asset management, and related areas. This episode is part of our September focus on client experience. We’re talking to influential industry leaders who can provide technology solutions that help advisors build stronger relationships, improve outcomes, and enrich their clients’ lives. A quick shoutout to our sponsor, the Invest in Others Foundation, please go to InvestInOthers.org, and be sure to subscribe to our show wherever you listen to podcasts so you don’t miss future episodes.
- Intergen Data [13:00]
- What is Client Experience?
- Focus on the Voice of the Client
- Moving Data Out of the Silos
- Asking the Right Questions
- Define Objectives to Identify Missing Data
- Client Satisfaction Isn’t Enough
Craig: I am happy to introduce our guest for this episode, Julie Littlechild, Founder and CEO of Absolute Engagement. Julie, welcome to the program.
Julie: Thanks so much Craig, looking forward to it.
Craig: Glad you could make it, glad we could coordinate the time. The world is going crazy but here we are in our little peaceful world of podcasting where we get to talk about fun stuff.
Julie: It does feel like we’re in control of something just for a moment.
Craig: I remember reading that if you’re interviewing somebody you should always give them a glass of water just so they can hold it. They feel safer just holding something, whenever you’re meeting with someone new. So this is hat we can hold onto, hold onto your podcast.
Craig: Julie, give me to 30-second elevator pitch for Absolute Engagement.
Julie: Sure. Our focus is on helping advisory firms use direct feedback and input from their clients to evolve the client experience and to drive growth. That’s it. Was that 30 seconds? Was it 16 seconds?
Craig: That was succinct. You need to expand on that, I’m going to ask you a lot more questions about that. Full disclosure, I like your company so much and what you’re doing so much that I joined the advisory board.
Julie: I know, and we are thrilled about that.
What is Client Experience?
Craig: I’m thrilled about that because you guys are going places. So this episode is part of our September focus which is client experience. Rolling it back a bit, before we just jump in, what is your definition of client experience?
Julie: That’s a great question, because we talk about it so much, and to some extent it reminds me of practice management, it was everything. I think client experience is a catchall for all that we do for our clients. So we think of it as incorporating the services we provide, how we deliver what we deliver. Everything from how a meeting is booked how our review is held. What the communications process is, just everything to do with service. It is also about the offer provided, the scope of the offer. And I think increasingly, we tend to focus on not just the experience itself but what are advisors and what are firms doing to support deeper engagement with their clients, which I think is part of client experience but maybe goes a little deeper.
Craig: So I want to talk about deeper engagement, deeper conversations. I’m gonna skip over the, the second question, what kind of client input do you recommend or have you gathered or helped advisors gather, that drives those deeper conversations?
Julie: It’s interesting because our focus is broadly on gathering input, and input can work in a business in a very strategic way, it can help you understand the offer that you should deliver, the needs of clients, how often you should meet all of those things. But I’ve been really interested in this question that you asked which is more about how do you drive a deeper conversation. And the way that I think about it is, that a deep conversation needs to reflect what is on the mind of the client in the moment. What are they concerned about, what are they inspired by, what’s their level of confidence. All of that, in my mind, informs the best possible conversation. But those things are really fluid, I don’t know about you, maybe it’s just me but I feel different right this moment than I did yesterday, at this time. Things change, the context changes. And so I think that this has really raised kind of an interesting challenge for advisors is, how do I how do I gather data from my clients that is in the moment, and can support a deeper conversation so. So we’ve been focusing a lot of attention on what what information can I gather for example, that allows me to co create the review agenda so that as an advisor I’m not just focused on the 10 things I had on my standard agenda, I’m actually focused on, where’s my client at, how are they feeling what’s going on, what are they concerned about and using that to change the conversation.
Focus on the Voice of the Client
Craig: So when you talk about gathering data in the moment, it’s part of your what your company’s really great at is, is driving that type of conversation helping advisors understand that. So what are some tips for, for understanding how to how to learn, which data is in the moment which that is not in the moment.
Julie: Yeah, and in, in firms that in my mind truly focus on the voice of the client the voice of the client as a strategy for the firm. To me that’s one of the most fundamental questions is sort of what are we trying to accomplish as an organization, what forms of feedback will support that, and then when do we need to gather that that input so is effectively what are the right questions and when should we ask them to support those goals. So, if you thought of something like, we want to we want to refine our offer so I’ll give you an example is working with firms who are thinking about expanding their offer into other areas maybe it’s more into health and wellness for example, we’re seeing a lot of examples of firms going beyond just just investments. Well, that would lead them down a path of asking a set of questions around awareness need interests in those particular things and that information would be relatively static right you could gather it at a point in time, and you could use that to support some of your strategic decision making. However, if we’re if it’s what we’re talking about how our clients feeling. If I do an annual survey and I ask clients how they’re feeling and I’m meeting with them six months later I can’t refer back to that and say well look, here’s how you were feeling six months ago so let’s have a deep conversation about that right it’s changed about 100 times so I think this idea of the cadence of of input is really important to me. So, in this case if it was the conversation we literally need to be gathering some input as we’re about to meet or within at least a week of that, and then use that to change the conversation that’s a very different way I think of thinking about the voice of the client not every firm is doing that.
Craig: That’s an interesting way of putting it the cadence of input. So it’s how it’s sort of almost like a tempo, you need to make sure you have that right tempo to get the data that’s making valuable, rather than, you know, is it is it just getting it right before you have the meeting is much more valuable than having all the data at six months old.
Julie: Absolutely, I mean you could also think of examples we’re talking about client experience where a lot of the most progressive firms that I know, use some form of client journey mapping as they’re thinking about the experience of truly understanding the stages their clients go through and what their needs are at those different stages. And often it will end up in a conversation around something like the onboarding process, Right, like some specific aspect of that journey. And the same issue applies if my goal would be to enhance the onboarding process by understanding how clients experience that I can’t ask those questions of all of my clients, some of them started 20 years ago, I don’t think they’re going to have meaningful input. What that means instead is I need to trigger a poll or a survey, you know, within 30 days of onboarding, so that it’s coming in on an ongoing basis. So, so again, it’s a different objective different questions different timing.
Moving Data Out of the Silos
Craig: That makes a lot of sense. That’s a process that advisors need to set up in their tools and technology to remind them, hey, the client’s been onboarded now 30 days, you need to send a survey. Also, don’t forget so that’s as part of the more technologies related action.
Julie: Yeah that’s right, I think that you know I’m just talking about one form of data here which is where we live our lives right which is direct from from the client there’s, there’s an almost infinite amount of data available to advisory firms to use and I’m sure this is a big part of your world sort of looking, looking at that and how it can be used effectively. And and I’m often concerned about data’s ending up in silos, so we’ve got demographic information in one system and planning information and then we do a client survey and it sits over here. You know to me part of the future of the data part of client experience is, how do we bring all of that together and really learn from the integration of those different data points to drive a more meaningful experience and I think we’re just sort of dipping our toe in the water on that kind of stuff right now.
Craig: That’s definitely something we talk about a lot, and something I’ve been beating the drum on for years is why do we have these silos, because we always have done it that way. CRM has always been its own database and financial planning has its own database and portfolio management is its own database, and reporting sometimes as a separate database and we’ve just learned to move data between them. And now we do have some integrations, but it’s still not the same. An integration, you’re still moving data between disparate systems, which opens up possibilities of mistakes and errors and things not syncing, which is never good for any firm.
Julie: I’ll give you a really simple example though of something that came up with one of our clients recently. We were doing a survey and they do an annual survey, and we’ve always tracked things like satisfaction and some of those key measurements for them. But what we did this year was we integrated fun flow information so we were able to effectively say when you look at clients whose net inflows are lower than average are their characteristics related to how they feel about the firm or the business? To me that’s a whole new set of insights being opened up. But to do that we had to look at two of those disparate forms of input, put them together and see what we could learn.
Craig: That’s fantastic. So that’s a really great way of leveraging different datasets, bringing them together to provide way more valuable insights than if you just had them separately.
Julie: Exactly. And you asked about the conversation, part of the question I have, I’d love your insights on this as well is well, what information does the advisor have at their fingertips when they’re meeting with advisors? I’ve just talked about one aspect of that which is our side of things, you know, in our world we want an advisor to be sitting down with a client and know, not only about the technical aspects of the relationship but to know how they’re feeling or to know what their satisfaction rating was on the last survey, or to know that they expressed an interest in certain topics. And all of those things come together and may come from different sources, but they’re all going to support a deeper conversation.
Craig: There’s more and more data available to advisors, but it’s not really organized well, and it’s not presented in a way that they can take action on they’ve sort of got to sift through it. So, having too much data is almost as bad as not having enough data because you’re still not making good decisions.
Julie: Well the other thing that strikes me is and I think you’re absolutely right, I mean this is something we think about a lot is, how can this be presented differently and I think we’re seeing some interesting examples out there. But there’s also a skill side of it, again I’m sort of harping on the conversation piece. It’s one thing to feed great data to someone but if they lack the skills to have that deeper conversation it’s all for naught at that point. I think we’ve got to, at the same time think about are we equipping advisors with what they need to use this information in a meaningful way?
Craig: I’d say no. In general, no firms aren’t. You’re on the cutting edge if you can provide that, and you can provide a way that advisors can just say here’s what I need to do today, boom, boom, boom, and here’s why we told you to do that. And you’ll most likely see a benefit. Either it’s lower churn, revenue growth, more prospects, more referrals as a main part of your platform.
I want to go back to something you said, and just throw out a plug for myself. You mentioned advisors expanding into health and wellness, that that was our topic last month was wealth and health. So that’s we’re just talking to technology firms that are integrating health and wealth for advisors to look at those because they’re so tightly linked. We talked to a company called Intergen Data, run by a good friend Rob Kirk, and they’re able to provide data that gives probabilities of clients having health issues in the future based on demographics. If you’re not looking at that how can you possibly help your client plan for the future if you don’t have access to your that health data, and other issues? So it’s really making for advisors to be to get beyond just managing assets and helping clients manage their lives.
Julie: That’s huge. I mean, talk about bringing access to something the client would not have otherwise. I mean I think that’s an amazing example of that.
Asking the Right Questions
Craig: Another good one from a friend, that she just posted something on LinkedIn, talking about how a client was searching advisors, and interviewing them, and finally came to her and he’s 70 years old, one of his goals is to travel to do travel. And he said, the other advisors I interviewed wouldn’t let me do it. They said I can’t withdraw that money yet, and she said you should definitely do that. She made a plan for him and he then she got him as a client, and you know he was much happier because now he can actually spend the money he’s worked 50 years to earn the money, and he hasn’t been able to use it. At what point can you take that money and actually use it for something that makes your life better?
Julie: Isn’t that funny. We’ve talked to a number of firms lately, sort of larger advisory firms who are going down this path of wanting to expand the service and it’s been an interesting process because I think that, again asking the right questions starts to become really important. You could ask clients for example, are you interested in learning more about health and wellness, I guarantee you quite a few will. But the real question, or next question is, are you interested in learning about that from us, do you see the connection there and and even further to offer a service such as this would it be of interest? And I think we’ve got to get a little more clever about some of the questions we ask because I see a lot of people almost thinking, well they’re interested in this therefore there’s a demand. Well not necessarily, there might be. But I think we’ve got to be careful.
Craig: Caution is always appropriate. Don’t want to necessarily go too far too fast, but you know, you have to you have to measure that. Alright so next topic, let’s talk about client experience generically, how has it evolved? How have you seen client experience evolving through the pandemic, and how will it be changing going forward?
Julie: There’s two things that we’ve seen influence experience and here I’m talking about some of the more granular aspects of experience. I mean everything from how often you meet with clients to how you meet to where you meet to what they might want to access online, all of those elements. And it’s been influenced significantly by the pandemic. The other thing and maybe we can talk about this, is the influence of demographics, the influence of age, in particular, because I think that we look at the changes that have happened through the pandemic, and it’s tempting to say, well, you know it’s going back. But really we’re actually seeing the convergence of the impact of the pandemic and the impact of working with younger people, almost at the same time and I think those things together will fundamentally shift some aspects of client experience.
So to your question, what are we seeing? Well, on average, we’re seeing a need for an increase in frequency of contact. Not for every client but there is about a quarter of clients who want to meet more often, for example. Not surprisingly, we’re seeing a very significant shift to people who want to meet virtually. And so those two things alone to me me, so what’s that going to look like, what are the tools that we’re going to use, how are we going to deliver an extraordinary review online? It’s not just Zoom, it’s how do we share, is there different technology that we need to use to engage in different ways. We’re seeing that, we’re certainly seeing and this is as much as anything, age, I guess just people having been trained to do things themselves so much more interest in what is the functionality, what are the things I can do on my own and what do I need you fo., I think we’re just more comfortable with using whether it’s portals or what have you. A
The other side of it, which is, in a way the softer side of it is just that. About two thirds of clients say that their views of their own future have changed over the last 18 months, and to me that means we’re going to have to think long and hard about what that means in terms of the advice that’s being delivered. So to your example, they might be thinking, I just want to spend this a little, I want some experiences I want to do different things. And I think that’s going to impact how advisors work with their clients. There’s different fears, we’ve all been through this tribe they’re thinking more about legacy and making sure their families are okay and all of those things. It’s rife, but I mentioned age and I tell you, to me this is the biggest one, there’s such a clear demarcation when we look at the data of what “younger”, and I would use air quotes around that because by younger I mean under 50, I don’t mean 20 year olds, and what they want and what they expect and how they want to interact, it’s like we’re looking at two completely different populations. And I’m seeing a lot of advisory firms who say look, the majority of our clients are 60, 70, 80 and they are when you look at it, and they’re allowing that segment to determine what the experience should look like and I think they’re in for a rude awakening if that’s the case.
Define Objectives to Identify Missing Data
Craig: I’m sure they are. That will change as more advisors retire and the client base should start to skew younger. Alright, so let’s move on to more about data. With your client insights platform which I really like and I’d like to talk some more about, how are you figuring out where the missing pieces are, and how can we grab that data, how can advisors get that data from the clients and make it more like a data feed that plugs into their existing processes?
Julie: Yeah, so I mean a couple of things come to mind there. One is that, the gaps, what they’re trying to accomplish needs to be driven by objectives. So if we’re talking to an advisory firm for example, often what we’re hearing is, we want a measure of how our clients feel but not just that, we’d actually like to look at that across the firm. Does the satisfaction level change by office, by advisor? Are there things that we need to learn about delivering a consistent experience across the firm?
If we think more firm than advisor I mean to me those are some of the much bigger challenges. And then what are the expectations of our clients and how does that change again by age or by, maybe persona or niche or or what have you. So, if they’re thinking about experience those are the kinds of insights that they’re going to want to think about. The other areas that we hear advisory firms really focused on not surprisingly are growth so if that’s if that’s the focus, they might be looking at retention. So where are our clients at risk, and how can we follow up with them directly to ensure that we keep them. Are there unmet needs among our clients that we have not tapped into and how can we tease out that information to close the gap. And the other thing that comes to mind which is a, you know, a little more focused for some firms is we’re also seeing firms taking some of these feeds from clients and tying it into their compensation model for advisors, so really looking at, is there a component of compensation that can be driven by the level of engagement of clients and it can we stop just assuming what that is actually get some real data on it.
Craig: That’s interesting. That’s something we do work on with broker dealers is advisor compensation that’s a part of our business and we’ve done a lot of work with that. But they don’t have it based on client engagement, as far as I know that that would be new.
Julie: Not often because they don’t have the data to do that, and it’s not as if it would be the only part of it, but we’ve seen, particularly among some larger RIAs, I think those have been the first to really adopt this to say look, there’s a component of this where we need to listen to the client and we need to make that part of how we compensate.
Craig: So what kind of data would you recommend for measuring client engagement that would feed a compensation to your metrics?
Julie: The baseline could be as simple as satisfaction. I mean, to me it’s not the greatest metric, but it’s not a bad place to start. There are a lot of firms using that promoter score, I have a love hate relationship with it as a metric. So the reality is I think you need more than one thing. But maybe more important than those generic metrics or measures are to craft a metric that actually reflects what the firm is trying to accomplish. So we have one client for example who who for whom we created what they call their client delight index, and it was just a name that they had started using but what it was based on was what clients said was most important to them, which to me is a far more effective way of measuring success is really are we meeting their expectations on what matters most. So this could change from firm to firm, you could create a metric based on how you want to be known to your clients, you could base a metric on what they say is most important and then I think you’re getting a little more granular and going a little deeper than satisfaction.
Craig: What do you use the word delight, delighting the client that reminded me of Guy Kawasaki who had a book called Enchantment, how to enchant, how to create an enchanting experience so that’s similar.
Julie: I don’t think I’ve ever enchanted anyone ,I don’t know about you but that feels like a high bar.
Craig: Yeah, no one’s ever used the word and chanting with me but that maybe they use other synonyms.
Julie: Maybe it’s just us Craig, I don’t know.
Client Satisfaction Isn’t Enough
Craig: We’re not enchanting you and I, unfortunately, but we’re doing our best. You mentioned satisfaction isn’t enough when we’re measuring levels of client engagement. Why is that?
Julie: The vast majority of clients are satisfied. So, about 90% are somewhat or very satisfied. So, what it will do is tell you if you have clients at risk because if they’re not in one of those categories, they are at risk and we do need to follow up. But the engagement metric that we use simply because it’s a higher standard is, a combination of satisfaction and referral activity. So when you have clients who are satisfied, and they are telling others about you, that’s a high standard to set and I think there’s, we can learn from that. The other thing that we found from the research I mentioned this idea of client self confidence earlier, we saw an incredibly strong correlation between how confident someone felt about their own financial future, so were they confident, did they feel in control, did they feel secure and satisfaction, loyalty, and net promoter score. So it’s kind of a reminder that those metrics aren’t just driven by what we do for clients but how clients are feeling about their own future, and in effect, that’s where the biggest gaps were over the last year.
Craig: Self confidence is the primary concern. So what can advisors do, is there any technology that can help increase client confidence or is it just something that’s more intangible?
Julie: I mean I think a lot of that comes down to conversation and because often the same people are financially secure and do have a clear plan in place, and may be more in control than their thinking. However, I think there’s a lot that we can do around, we call it leadership which is a really broad term, but the idea of using technology to really personalize the client communications that we share. That to me is a way to demonstrate leadership, and that in turn, I think is a way to drive self confidence.
Craig: You are good, you just segwayed right into the next question about personalization, smooth, very smooth. So talking about personalization. So, what does it mean to demonstrate leadership as a way to drive self confidence?
Julie: Well, when we look at the path from satisfaction to engagement we use a very simple graphic which of course we can’t see right now it’s just a sort of a pyramid with good service at the bottom the right offer in the middle of leadership at the top. So, good services everything that you would expect you call people back you meet them often enough you don’t mess up too often, if you do you fix it. It’s everything that we relate to good service, having the right offer is obviously things like financial planning, if that’s the need.
But leadership to me is really, it’s something of an intangible but not necessarily it’s based on what the needs and concerns and challenges of your clients are. It’s the guidance that you provide to clients, it’s the thing that puts money in the context of their lives. And as much as that sounds very intangible I think where it connects back to this idea of personalization is simply and maybe we can tie it right back to health and wellness. Health and wellness, was the single biggest data point increase we saw in topics of interest last year, not surprising, we were in the middle of a pandemic. It’s still quite high, by the way, even coming out of it but, so what does that tell us? It tells us what that’s what’s on the minds of our clients. If we can support them in that, I think we’re demonstrating leadership because it demonstrates we understood what they’re worried about and we can support them with that. And I think we can use frankly some fairly simple technologies to personalize communications to be able to say, you told me that this was a topic of interest and and maybe using a marketing platform or something along those lines to target the right content to those clients. Again, I’m not talking about the most sophisticated technology here but I’m talking about something that requires technology to make it work.
Craig: There is a number of marketing platforms, anyone listening can check or go to Kitces.com and check the the advisor FinTech map that the Michael and I partner on, there’s a lot of marketing tools there in the lower left hand corner I believe have an app that you can check out.
Julie: You are very familiar with that.
Craig: Well Michael I every month, it’s almost time, the last week of the month we got together the first week of the month we will review the map what’s new, what’s changed, who’s been acquired, and things like that. What new companies have come up so it’s a constantly changing map, we are in a dynamic industry. And now, speaking of dynamic we’re out of time, this is great, you set it all Julie, you managed to get a lot of information out there in a very short amount of time. Where can people find out more about you and your company?
Julie: AbsoluteEngagement.com, we’ve got a blog and we share all of our research there so it tends to be the place to go for anything that we’re releasing on these issues.
Craig: And what’s your Twitter handle for everyone who’s on Twitter.
Julie: @JLittlechild. It’s like asking me my phone number,
Craig: Who remembers? I’m always retweeting your blog post I think they’re great so you can check my Twitter feed as well.
Julie: And I you.
Craig: Awesome, we are this is a mutual admiration society and we’re going to sign off. Julie, thanks so much for being here.
Julie: Thank you. Take care.
Click here and schedule a Discovery Session to find out how Ezra Group can help your fintech firm grow revenue in the wealth management space.