Financial advisors today face an uphill battle. Investors are increasingly relying on passive investment services like robo-advisors and ETFs, or looking to manage wealth themselves via online brokers and other trading services. Technology has created significant barriers to the way advisors have traditionally done business. But the industry is finally catching on, and now, using modern tools to fight back.
In fact, it was the main theme at the recent T3 Advisor Conference which was held at the Hyatt Regency Hotel in Orange County. It’s the largest gathering of financial service providers and vendors with well over 600 attendees and dozens of vendors. T3, short for Technology Tools for Today, spanned three days with two being focused heavily on panel sessions ranging from IRAs, retirement savings, big data in the marketplace, cyber security, and customer service in their industry. Put on by financial planning and technology expert Joel Bruckenstein, the conference’s mission revolves around the fact that “today’s successful financial advisory firms have a big challenge: serving their clients well while keeping up-to-date with the newest and best technology and practice management tools.”
Bruckenstein, along with other speakers including Mark Bruno of Investment News, Brian Hamburger of the Advisor’s Advisor, Sirisha Gorjala of Morningstar, Stephanie Macon of TD Ameritrade Institutional, and Ian Sheridan of Vestigo Ventures sought to educate their financial services’ colleagues on industry trends and technology raising the tide for all boats.
“T3 Advisor Conference is the only conference in the industry devoted exclusively to the technology needs of independent RIA’s,” Bruckenstein said, “As such, it is the single best place for financial advisors to go if they want to research providers of core technologies such as CRM, financial planning software, portfolio management software, rebalancing software, etc. It is also a place where anyone interested in FinTech, be they wire houses, independent broker/dealers, banks, credit unions, insurance firms, private equity firms, etc., can see the latest products and take the pulse of the industry.”
There was a consistent theme reflecting a widening disconnect between financial services providers and their current and potential clients. While the T3 conference is a B2B event, it provided valuable insight into how industry professionals are increasingly embracing technology to modernize how they can better service their clients in the way they want to be serviced.
Financial Services of the Future
First, financial service providers are learning a lot about their clients from collecting and analyzing big data, which in turn is changing how they conduct their businesses. On the Future Tech: The Advisory Firm in 2025, Andy Putterman of 1812 Park, LLC and Ian Sheridan of Vestigo Ventures talked about what has become of the relation between the financial service provider and consumers. It can be deduced that somewhere along the way brands, technology, and robo-advisors weakened the relationship between financial services and consumers, but as Sheridan says, “the investor has clear expectations on how they want services [whether or not the investor is interested in robo-advisory or traditional relationships]…they [investors] expect to find connectivity and intimacy. Control, the ability to research [on advisor and advisor words], and will validate… The ability to self-service is important, and validation of the crowd.” As Sheridan coined, “customer intimacy” is critically important.
Knowing Your Clients
Second, on the Redefining the Client Experience panel with Jason Gordo, Head of National Advisor Partnerships, FinLife Partners, A Division of United Capital, continued on theme of disconnectedness. His message was using technology to enhance emotional connections with clients. Gordo said, “financial providers have a 361-day challenge.” The relationship between service provider and client is broken because advisors meet with their clients four times a year, and when they do meet, it’s a superficial and “data” driven conversation. Providers need to maintain relevancy in their clients’ life throughout the year. Gordo said, “I believe the firm of the future is going to be valued on IUM (information under management) not AUM or revenue…IUM is the key to a successful financial service business in the future. If you aren’t managing 100% of the clients’ IUM, you’re quickly becoming obsolete.” The key to successfully managing IUM is to understand the client at the most basic level, or “Honest Conversations.” Honest Conversations is the time that a financial servicer provider uncovers values, anxieties, goals, fears and motivations, better ensuring that clients have a genuine sense of being OK.
What the data is showing is consumers are now beginning to demand a sense of positive, deep and emotional connections with the financial planner. They need empathy and wisdom.
Reaching Millennials
Third, big data and technology are educating financial service providers on the opportunity for millennials. On the same panel, Putterman said on millennials, “advisors say they aren’t in their target market. They don’t have the wealth. I will wait.” Putterman makes a point to say that worked 30 years ago, but millennials are already in engaged. Just look at Fintech startups like Acorns, a micro-investing app and that has over 1 million customers. It’s investing democratization, giving millennials financial empowerment, and has opened the door and built that initial relationship between this group and finance. Millenials, especially those already using services like Acorns, are encouraged to meet the financial service provider half-way and take another step to financial empowerment.
This conference was heavily themed around educating financial service providers on who to service and how best to do it. The speakers sought to relay how important individual connectedness with their clients will determine a firm’s future. Whether you’re a first-time investor or a veteran investor, it’s never a bad idea to speak with an experienced financial professional that puts your interests ahead of their own. However, shop around for the financial service provider that sees beyond the collectable fees, and instead, sees perceives their role to genuinely care about making life better.
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