In financial services, like most industries, it’s hard to ignore the voice of more experienced employees—but that’s not to say the voice of newer and younger advisors should be disregarded. In fact, new findings from our Voice of the Advisor survey of North American financial advisors reveal significant differences on various topics between younger (those with less than 10 years of experience) and older advisors, indicating an emerging divide on important issues in the industry.
Let’s look at these findings in more detail. More than their older colleagues, younger advisors:
- Have clients question their fees. Some 40 percent of newer advisors are more likely to have clients question their fees, compared to 23 percent of older advisors.
- Are asked for more information by clients about their investing strategies, including ways to invest on their own—57 percent of newer advisors versus 37 percent of older advisors.
- Are asked by clients for digital tools their firms don’t have. There is a significant difference related to that point between younger advisors (52 percent) and older advisors (20 percent).
- See a trend toward lowering fees to retain clients—47 percent for younger advisors versus 26 percent for older advisors.
- Believe online investment managers are a threat to their business—23 percent for younger advisors versus 15 percent for older advisors.
- Use social media with their clients—74 percent for younger advisors versus 59 percent for older advisors.
- Prefer Facebook to LinkedIn. While older advisors prefer LinkedIn to Facebook as a platform for client contact (78 percent to 70 percent), it’s the opposite for younger advisors. They prefer Facebook (81 percent to 60 percent), suggesting social is shifting from professional contact to personal contact for a more intimate client/advisor experience.
Bottom line: advisors who are newer to the job are feeling the impact of new technology on the client experience, and even to the business model, in the form of more tech-savvy and engaged clients, and threats from digital and online based firms. The message to financial firms: listen as well to your younger advisors in order to understand the current market dynamics. Join me next week when I’ll look at the value proposition advisors bring.
To read more about our survey results, check out last week’s post: