Sometimes, The Old Ways Are The Best Ways



Go ahead, try to stop progress. It can’t be done. Progress can possibly be slowed, but it can’t be stopped. Progress is often seen as a way to improve the world, and there is always going to be an audience for a new way to perform old behaviors.

There are certain areas of our lives in which progress steamrolls us, and one of those areas is communication. When letter writing gave way to the telegraph, a precedent was set, and the favored manner of communication spiraled through the telephone to e-mail to social media to texting to smartphones. Is there a next step to be taken?

For many years, financial advisors were prevented from updating their communication methods due to federal regulations. Electronic communication may be faster than having a face-to-face meeting or sending a letter, but e-mails can be stolen easily, and texting can be misunderstood. For many years, the SEC limited advisors from using electronic communication for anything directly related to investing offers or decisions, in part because record-keeping of electronic messaging can be difficult.

But the SEC has loosened some of those regulations, and financial advisors have plowed ahead, using texting and other forms of electronic communication to do everything a financial advisor needs to do. Some advisors have gone so far in the direction of modern mobile technology that they have forgone the classic advisor standard of having a home office. Their smartphone is their office.

Such modern behavior is all well and good as long as the messages are received and clients are comfortable with communicating electronically. That is not always the case, especially with older investors who are accustomed to communication methods that were modern 30 years ago.

This is especially true when an advisor has a new product to offer investors. According to Spectrem’s new study Communicating with Advisors and Providers, which discovered that while some investors are willing to text their advisor on occasion, when it comes to something new, they want to hear about it someway old.

Asked how they would want to be educated on a new product their advisor was pitching, 33 percent said they would want to hear about it in an in-person meeting, and 32 percent said they wanted the information to come via email with a link to the product page attached. Unfortunately, the in-person meeting is going the way of gas lamps, with some advisors doing their client meetings with video-chatting rather than in person. Email is the most accepted electronic communication system around, but many people spend much more time texting and posting on social media than they do checking or writing e-mails, and advisors are trying to tap into those more modern clients.

This study question asked the No. 1 choice of investors, so the first two responses take up two-thirds of all responses.

The No. 3 choice was an actual phone call, which received 22 percent of the nods. Of course, it would be difficult for an advisor with many clients to make individual phone calls to each one of those clients to pitch a new investment offering, but some investors would prefer that.

After the top three responses, the study gets even more old school. Five percent of respondents said they would prefer to receive an actual hard copy mailing with a brochureexplaining the value of the new product.


Top Takeaways for Advisors

It is 2018 and still a majority of investors want to receive significant information in the mail, in person or via a phone call. What’s a modern-day advisor supposed to do?

The answer is “Know Your Clients”. Determining just how an investor wants to receive vital information is one of those “get to know you” questions an advisor needs to ask, both initially and with occasional follow-ups. If an investor wants a phone call, note that and act accordingly. Many modern investors are going to accept text messaging or video links as a way for you to disseminate new information, but advisors should accommodate those investors who are still attending old school.


©2018 Spectrem Group