Personalization in wealth management is more than simply addressing a client by their first name; it’s understanding their needs and goals, and tailoring a financial plan to them. Retention is increasingly becoming a top issue for RIAs, since only 39% of clients with assets under management with $10 million or less would recommend their current advisor. This number signals that as many as 60% of wealth management clients might be looking for their next advisor.
In the face of digital disruption, how can wealth managers still deliver value? Advisors continue to face considerable pressure on their time from meeting with clients, completing compliance tasks, prospecting, and general business management tasks. Automation promises to alleviate some of this pressure, but all of that data isn’t useful unless it becomes something actionable. Customer lifecycle management takes the capabilities of CRMs and transforms that data into meaningful intelligence.
Here is what lifecycle management is, what it means for clients and RIAs, and how wealth management firms can use it to their full advantage.
Getting to the Heart of Customer Lifecycle Management
Customer relationship management systems (CRM) are the lifeblood of wealth management firms. Most firms have adopted some sort of CRM, whether it’s a cloud-based system or something else. It’s now the norm for advisors to store client information, notes, and activities in one central, always-available solution.
Customer lifecycle management takes the CRM one step further and focuses not only on client data, but also centers the client experience. Essentially, customer lifecycle management takes all of the data you gather in your CRM and gives valuable insights into what your client needs and wants, from prospect to seasoned investor.
What Customer Lifecycle Management Offers Clients and Advisors
Lifecycle management treats clients as individuals, and understands their needs and wants from your first introduction forward. It’s quickly becoming an essential part of customer retention and personalization for wealth management firms. Lifecycle management also addresses several other key opportunities, including:
- Identify Risk and Churn: Whether a client is newly onboarding or considering a switch, lifecycle management identifies specific metrics that can predict the likelihood of leaving the firm. Once these risk factors are identified, firms can nurture clients and increase retention.
- Create a Smoother Onboarding Process: Beginning a new relationship with a client is all about learning their pain points and their goals. Once you start gathering information, you can skip to the good part and create a better client strategy using lifecycle management methodology.
- Leverage Automation and Focus on Clients: Automation and RPA are coming to wealth management and promise to free up a lot of advisor time. RIAs can devote more time to understanding clients and their needs instead of asking for data, tracking down documents, or working on non-strategic tasks.
Lifecycle management offers firms more efficiency and better results for their clients. It also opens up significant opportunities in prospecting as firms become better able to offer services and demonstrate potential value quickly. As fintech and other disruptive technologies continue to lure clients away, wealth management firms can provide deeper personalization and expert advice. Customer lifecycle management will soon become a must-have for firms looking to minimize attrition and keep their most valuable clients.
About Docupace
Docupace is a solutions provider focused on digitizing and automating operations in the financial advice and investment industry. Financial services firms use the Docupace Platform (a cloud-based, integrated software suite) to reduce back-office expenses, improve efficiency, strengthen recruiting, and enhance the experience of advisors and investors. With headquarters in Los Angeles, California, Docupace is proud to serve some of the largest independent broker-dealers and registered investment advisers (RIAs) in the financial services industry. For more information, please visit www.docupace.com.
