Financial Advisor Marketing & Technology

Marketing & Technology For Independent Financial Advisors


Archive for June, 2009

Building Client Loyalty

We’ve made it very easy for you to remind clients why they need you.

All the tasks you’ve completed for a client over the past 12 months are now conspicuosuly displayed on each client’s home page.

This important new feature in the Advisor Products Client Portal is integrated with Redtail Technology’s CRM. So when you input an Activity in Redtail, it shows up automatically in a client’s portal.

With advisory firms under financial pressure because asset values have plunged in the past year, showing each client a list of tasks you’ve completed is a way of building loyalty. In light of the bear market and advisor Ponzi-scheme scandals, it is critical to regularly include this information in client communciations.

Many tasks advisory firms handle for clients go unnoticed or are quickly forgotten. Clients may not know when you’ve spent hours rebalancing their accounts, updating their financial plans, or researching a problem by speaking with their attorneys or accountants.

The Advisor Products Client Portal Platform—the only advisor system dedicated solely to advisor-client communcation—makes it easy for you to remind clients of all the work you’re doing for them. It also provides a plethora of other information designed to strengthen your relationships with clients.

Redtail costs $600 a year and portals for 100 clients costs $2,200 a year. Together, these two best-of-breed applications form the solid core of any advisory firm’s practice management system. And they’re each integrated with almost all of the leading PMS and financial planning applications used by advisors.

Feds Want All FAs To Be Fiduciaries

Way back on page 72 of the regulatory reform white paper released yesterday by the U.S. Treasury is some pretty big news for financial advisors.

“We propose the following initiatives to empower the SEC to increase fairness for investors,” says the Treasury white paper. “Establish a fiduciary duty for broker-dealers offering investment advice and harmonize the regulation of investment advisers and broker-dealers.”

Entitled, Financial Regulatory Reform: A New Foundation, the white paper makes official the Obama Administration’s intention to put registered reps and advisors at RIAs under the same set of regulatory rules. That’s not a surprise to anyone.

“Retail investors are often confused about the differences between investment advisers and broker-dealers,” according to the white paper. “Meanwhile, the distinction is no longer meaningful between a disinterested investment advisor and a broker who acts as an agent for an investor; the current laws and regulations are based on antiquated distinctions between the two types of financial professionals that date back to the early 20th century. “

What is a surprise is that the Administration is asking to impose a fiduciary obligation on brokers. Of course, only advisors at RIAs are now fiduciaries, and thus obliged always to do what is in a client’s best interest. That is a much higher standard of care for clients than is imposed on registered reps, who must only ensure they are giving advice suitable for their clients.

The Treasury says in the 89-page paper that RIAs and Registered Reps are the same to retail investors. “In the retail context, the legal distinction between the two is no longer meaningful,” says the Treasury white paper. “Retail customers repose the same degree of trust in their brokers as they do in investment advisers, but the legal responsibilities of the intermediaries may not be the same. The SEC should be permitted to align duties for intermediaries across financial products. “

“Standards of care for all broker-dealers when providing investment advice about securities to retail investors should be raised to the fiduciary standard to align the legal framework with investment advisers,” according to the Treasury Department. “In addition, the SEC should be empowered to examine and ban forms of compensation that encourage intermediaries to put investors into products that are profitable to the intermediary, but are not in the investors’ best interest.”

The Administration is calling for new legislation:

requiring that broker-dealers who provide investment advice about securities to investors have the same fiduciary obligations as registered investment advisers
providing simple and clear disclosure to investors regarding the scope of the terms of their relationships with investment professionals
prohibiting certain conflict of interests and sales practices that are contrary to the interests of investors.

The effort to regulate advisors at RIAs like registered reps seems unstoppable. Like it or not, it’s what the Administration wants, and consumer groups, like Consumer Federation of America, also are backing this effort.

We don’t know how this would be done, of course. But it’s likely FINRA will be charged with the task. RIAs should expect, perhaps as early as 2010, much higher costs for compliance.

Imposition of the fiduciary standard on registered reps—if this catches on—will rob RIAs of a huge marketing advantage. Accepting the responsibility to always do what is in a client’s best interests is a real differentiator for RIAs. It’s hard to imagine how the fiduciary standard would be applied to brokers who accept commissions as well as fees. Any comments from readers clarifying that part of the proposal would be appreciated.

It seems likely that making all advisors say they will act as a fiduciary will water down the meaning of the term. While the Financial Planning Coalition—the group comprised of Financial Planning Association, National Association of Personal Financial Advisors, and the CFP Board of Standards—today issued a release applauding the Administration for proposing the imposition of the fiduciary standard on brokers, I am not as sanguine. I suspect that advisors who today are fiduciaries are going to have a tough time differentiating the way they give retail advice from the way brokers who are fiduciaries do it.

CE Credit On Webinar Replays

When the U.S. economy seemed like it might collapse last October, Advisor Products hosted a webinar for advisors in an effort to help to help them cope.

Attendees were so grateful, we did it the following week.

Pretty soon, it became clear that advisors wanted us to bring them this information regularly. Thus was born the Financial Crisis Webinar Series, which brings advisors leading thinkers from the financial advisory profession every Friday at 4 p.m. EDT

We’ve now hosted 32 webinars , replays are always available, and since January we have offered continuing edcuation credit for Certified Financial Planner® licensees.

Last week, we upgraded our registration platform. As a result, you are now be able to receive continuing education credit when viewing webinar replays.

With the new registration system, you register just once. We’ll drop a “cookie” into your browser—a short line of texton your computer's hard drive—and you’ll be recognized without registering the next time you return. If you use a different computer, you’ll need to log in again, however. Before this upgrade, you had register your information each time you wanted to view a webinar replay.

The new registration system also allows you to access videos and request more information about our services from the Advisor Products website. Videos explain our client portal system, newsletters, AdvisorVault, and Online Reporting for Advent Axys or PortfolioCenter.

Advisor Products clients will continue to use their existing log-in credentials for accessing the BackOffice for managing your website, email newsletter, and newsletter. That is unaffected by these changes.

It is our privilege to be able to bring you The Financial Crisis Webinar Series. Join us this week to hear Mark Tibergien, CEO of Pershing Advisor Solutions, speak about the link between operational efficiency and human capital.

Redtail Technology Integrates With Advisor Products

How would you like to be able to show clients a list of all of the things you’ve done for them lately?

What if you could automatically feed that list of achieved tasks from your CRM system to a secure personal website for each client?

Or how would you like to be able to assign clients tasks from your firm’s CRM system, and feed these To-Dos automatically to each client’s secure personal website?

This is all totally doable right now.

In fact, these are just a couple of the many powerful features in the new Advisor Products integration with Redtail Technology.

Integration between Advisor Products and Redtail extends one of the advisory profession's most powerful customer relationship management (CRM) software applications to a client-facing application.

Redtail’s easy-to-use web-based CRM system helps you manage your internal staff; Advisor Products' secure Client Portal system helps you communicate with clients effectively.

Redtail CRM tracks and organizes all your client activities. Featuring online calendaring as well as task management, Redtail is easy to use and offers a low cost of ownership.

The Advisor Products Client Portal lets you provide each of your clients with a secure financial home page. Information is fed from your firm's applications for performance management, financial planning, and client relationship management. Client Portals also feature a vault and newsletters written by Advisor Products that are personalized to each client’s profile, making a great presentation of all the information clients need from you.

Utilizing eXtensible Markup Language (XML) feeds, data flows automatically from Redtail to Client Portals and vice versa. The XML feeds save you time and money because you don’t need to re-key data from one application to another.

Using the Advisor Products-Redtail integration is simple. In Redtail, which is a web-based CRM, there’s a page where you fill in details about an Activity your firm is performing for a client.

At the bottom of every Activity page is a checkbox to “Share with Advisor Products.” Checking that box automatically sends that activity to your clients' portals.

Whenever your firm completes an activity for a client, you can insert a note about the completed task in the Activity page in Redtail and it will flow automatically into the corresponding client's portal.

Clients, thus, can see all of the work you do on their behalf. That's important since most of the work advisors do is unknown to clients.

The Advisor Products Client Portal system features a “To Do Manager.” The To Do Manager is where all Achieved Tasks are displayed to your clients.

When you click the “Share With Advisor Products” checkbox in Redtail, that activity is displayed in your client’s secure personal portal as an “Achieved Task.”

In addition to showing clients all of the work your firm does for them, you can also assign clients tasks in Redtail that will automatically be fed for display in To Do Manager.

From the Activity page in Redtail, just pull down the Category menu and choose “Portal Client To-Do.”

That Activity in Redtail, as well as any updates to it, will be fed into the client’s portal.

The integration of these two applications means nothing falls through the cracks with clients anymore.

The integration of Advisor Products with Redtail also makes it easy to provision new client portals, as the demographic information from Redtail can be automatically fed into the Client Portal Platform.

Additional capabilities are being added to the interface between Advisor Products and Redtail. Redtail users will be able to use Advisor Products content to send letters, email newsletters, and other client correspondence. In addition, Redtail's Document Management system will integrate with AdvisorVault, the Advisor Products client vault. Advisors using the Redtail Imaging for document management will be able to share any document with a client through AdvisorVault.

To learn more about the integration, please fill in this form.

A webinar about the integration of these three advisor systems will be held Wednesday, June 10, at 4 p.m. EDT. Register at

Reducing The Rate Of Client Failure

Why do some advisors annually get fired by 10% of their clients or more while other advisors consistently lose just 2% or 3%?

With the impact of the financial crisis hitting advisory firms and clients alike, the answer to this question is critical and may not be that complex.

Clients fire you because they feel disconnected from you and your firm. They leave when you lose credibility, when you fail to touch them in meaningful ways, when you fail to confront their crucial financial issues with them.

Clients don’t fire you because of investment performance. They fire you because they feel you let them down and do not provide enough value.

When a client fires you, it’s not just you who loses. They, too, often lose. Clients that fire you may hire an advisor who is not as devoted or competent. Or they may try to manage their money on their own, which may lead to failure. When a client fires you, it’s often not just you who has failed. They also fail.

What can you do about it? How can you stem your attrition rate and help more people by giving them good financial advice?

The answer doesn’t lie in a new financial product; we have enough products. The answer is not in a new market-timing strategy; we all know diversification is the wise course because no one can predict the future.

The answer is in your communication with clients. It’s in your ability to draw people out, to make it safe for them to share with you their greatest fears, and your desire to actively listen and then meet their demons head-on with reason and intelligent solutions. The way to retain clients is to be deeply engaged in ongoing financial conversation with them about their greatest fears and dreams.

So I asked one of the world’s foremost experts on crucial conversations for help—the authors of The New York Times bestseller, Crucial Conversations: Tools For Talking When The Stakes Are High. To my amazement, the authors were intrigued and have designed a way for financial advisors to better understand how to conduct crucial financial conversations with clients.

Published in 2002, Crucial Conversations, has influenced millions of business leaders. “This is a breakthrough book,” said Stephen R. Covey, author, The 7 Habits of Highly Effective People. “I found myself being deeply influenced, motivated, and even inspired.”

The authors of Crucial Conversations, Kerry Patterson, Joseph Grenny, Ron McMillan, and Al Switzler, established a consulting firm, VitalSmarts, which has developed dozens of corporate training programs for dozens of Fortune 500 companies.

David Maxfield, a respected academic, was named head of research at VitalSmarts. Maxfield has taught at Stanford University and the Marriott School of Management at Brigham Young University. He is the recipient of Motorola University’s Distinguished Teaching Award and Stanford University’s Dean’s Award for Innovative Industrial Education. Maxfield is also the author of the 2007, Influencer: The Power To Change Anything.

Maxfield has been working with me to research how well financial advisors handle crucial conversations with clients. On July 10, at what promises to be a special session, Maxfield will lead a presentation at The Financial Crisis Webinar Series in which he will teach advisors the basic skills needed to conduct crucial conversations with clients. You can reserve a place at this free webinar now by taking a 10-minute survey designed to measure financial advisors’ ability to conduct crucial conversations with clients.

The full impact of the financial crisis has not yet been felt by advisors. Investors have been paralyzed by fear. Many advisors are likely to be fired in coming months as the shock of the crisis subsides. Please take the survey and join us as we all heal the wounds of the meltdown and try to learn from it.

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