“There is nothing quite so useless, as doing with great efficiency, something that should not be done at all.” - Peter F. Drucker
We have a mish-mash of financial services pundits whose only purpose is to solve the industry’s problems.
Their efforts are either focused on the singular problem of prospective clients from varying demographics who refrain from engaging with financial advisers, or they work tirelessly to wrench the profession from its mediocrity by pronouncing the next exciting development in financial advice.
It would be phenomenal if the answer to either problem ever appeared –the ultimate disrupter, the game changing gizmo that will explain eloquently to the mass market and the disbelievers the value advisers offer while building trust and additionally engaging all generations.
In terms of engagement, lack of trust is perhaps the main concern, and possibly puts off those who ought to engage with financial advisers but instead participate with the Money Advice Service (Mas). The retail distribution review’s main aim was to rebuild trust in financial services; unfortunately this was achieved by providing less advice and removing the biggest problem in high street bank financial advisers.
To date, in search of the answer, we have seen: software, hardware, cashflow modelling, apps, mobile and even the ultimate foolishness of eradicating the real value of a human adviser and offering the opportunity for less interaction by asserting the lie that online advice can be fully automated by some clever algorithm, so called robo-advice.
Predictably theideas and proclamations have so far never yielded anything significant. Financial advice is somewhat dull, often provided by rather tedious individuals who like to sit in posh offices in front of certificates hung neatly on the wall. No matter how intensely anyone tries, they can not make financial advice interesting, exciting and engaging.
The internet was proclaimed as the saviour of financial advice, areal chance to reach more people, to offer exciting and disruptive tools that would change the vista of tedium and see advice bloom into a thrilling experience.
Regrettably the internet was not the energiser required. Research from Google Adwords undoubtedly demonstrates the key searches around ‘financial planner’ are in decline. The average monthly search volume is a mere 600, for those who’ve spent many hours and copious amounts of money to gain chartered status, only 480 people are searching for you.
The term ‘financial adviser’ fares slightly better at 1,900 searches per month, surprisingly (as so many advisers value the term) adding ‘independent’ results in just 390 searches per month. In contrast, Mas and Pension Wise together receive over 60,000 searches a month. It is reasonably obvious where people are going for financial advice and guidance.
For those small advice firms investing time and money in the so-called robo-advice revolution, according to Google a measly 40 people a month type that search term. In terms of marketing and establishing new brands any new entrants will be playing catch up to the market leader in offering products and varying levels of advice. The undisputed financial services colossus Hargreaves Lansdown collects close to 400,000 searches a month.
So the profession needs to listen to Peter Drucker, stop doing quite useless stuff with great efficiency, stop trying to find the answers to questions that are simply not being asked by the market. The mass market is being served, people don’t want to invest with small unbranded robo-advisers when they can use market leaders that meet their needs perfectly. They don’t want to be educated in church halls or, in reality, educated at all. If you attend the dentist you just want your teeth fixed; who is interested in the process or products?
Financial advice is and always will be about human interaction, trust and good service, operating in niche segments that have two distinct requirements; clients who have needs which are met with products and objectives that are met with planning.
Based on the Google search volumes appealing to prospective clients or indeed trying to educate the mass market using the internet is erroneous. Few people use the internet to find financial advisers and only 25 per cent of those are using mobile devices.
The world has moved on, advisers should stick to the basics and get into the market place instead of demanding or waiting for clients to come and see them and spending foolishly on internet-based solutions.
