As an industry, we are conditioned towards destination. While this is largely a core trait of investment services, it’s reinforced with a popular performance ranking system. It’s all too easy to stay in our product mindset with destination thinking. Look at it through a consumer lens for just a second – we all need a Dentist and desire a positive outcome, but how often do we avoid and/or delay the experience as much as possible?
Hearts & Wallets' latest retail investor sentiment findings continue to reflect financial professional distrust and investment decision uncertainty. Additionally, investors’ evolving behaviors such as account fragmentation, changing attitudes towards retirement, increased self-direction and an interest in digital entrants are top of mind issues for providers’ strategy adjustments. Moreover, add to this short list the ongoing active/passive debate with all its implications, employer sponsored retirement plan participation in a “gig” economy, new legislation and we can quickly lose track of our primary mission: to take retail investors from their starting points to realizing their goals, while making sure they enjoy the ride to stay with us on the journey.
Satisfying retail investor needs amidst these complex dynamics and applying a client needs framework begins by broadening our focus beyond investment performance to the larger client experience. In Hearts & Wallets’ “Wants and Pricing” insight module report, investors increased their importance levels assigned to components of their overall client experience. Not surprisingly, Millennials became more demanding. However, so did Post-Retirees. In contrast, High Net Worth investors ($2MM+) grew more relaxed.
Underscoring that it’s not just about the destination right now, our research also found that having “fees that are clear and understandable,” “explains things in understandable terms,” and “is unbiased, puts my interests first” edged out “has made me money.”