If you build it, they will come…or in the case of Millennials, if you offer it, they are more likely to come.
Remember the old days when you could get a toaster if you opened a bank account? Well, over the years, all of those types of promotions went away primarily because of various compliance rules that discouraged those types of actions. Additionally, investors became somewhat skeptical of anyone who might be offering them something in addition to investment advice. While the occasional dinner with an advisor was deemed as acceptable, sometimes a golf game, other actions were viewed skeptically by the “seasoned” investors.
But Millennials don’t necessarily agree. They are open to multiple types of experiences, events and even gifts from their financial advisor. In contrast, Gen Xers aren’t even interested in having dinner with their financial advisor, in many cases.
In research Spectrem Group recently completed with GenXers and Millennials, almost a third of Millennials (29%) indicated that they expect a gift or favor from their financial advisor for being a client of theirs. Only 7% of GenXers felt similarly. Based on Spectrem’s ongoing research with wealthy clients, only a small percentage of older investors (Baby Boomers and those in the WWII generation) expect gifts or favors from their advisor.
What type of gift or favor do the Millennials expect? The most common type of gift or favor identified was being taken to a meal (54%). This was followed by tickets to a sporting event (41%) or invitations to socials and happy hours (41%). Almost a quarter (24%) expected tickets to a cultural performance or an art opening or wine/alcohol (24%). Other items included tickets to a philanthropic event and gifts for children or pets.
Millennials also expressed interest in attending events sponsored by financial advisors when they were in the fact-finding stage of their advisor search. When asked if the would be interested in attending events sponsored by a financial advisor at no charge as long as they agreed to meet with the advisor and listen to his background, roughly half of Millennials expressed interest in multiple types of events.
Half would attend at sporting event and just slightly fewer would be interested in attending a happy hour, a discussion panel with a famous speaker, or an outside activity like a hike or bike ride. Four in ten would be interested in participating in a spin or yoga class or working at a volunteer event.
If prospects are interested in events such as those described above, it’s no wonder that they have greater expectations of their advisor’s willingness to provide gifts in the future!
Financial advisors and their firms need to reassess how they are interacting with clients and prospects. While a large number of older clients may be satisfied with regularly scheduled dinner meetings, there may be older generations who are interested in some of the activities identified by Millennials. Reconsider not only how you approach and service Millennials but all of your clients. Sometimes new situations and new approaches can deepen and improve even long-term existing relationship. And if some of your clients have no interest…you can always have dinner.
Maybe Millennials have the right idea.
© 2018 Spectrem Group