Ninety-one percent of advisors polled at SEI Advisor Network's National Strategic Advisor Conference in Dallas said they expected business to be better in 2013 than it was in 2012.
That optimism doesn't translate to the economy, though. Advisors were cautious about the direction of the economy. Forty-one percent predicted slow but consistent growth, and 40% foresee a near-term correction. Just 13% are digging in for another recession (twice as many as those who expect a near-term return to prosperity). Federal debt is a major concern, although markets in China and Europe, and the impact of tax increases, were also weighing on the minds of the advisors at the conference.
The reason for that, according to Steve Onofrio, senior vice president and head of sales at SEI, is that the measures they've taken following the recession have served to strengthen their businesses.
"Over the past four years, advisors have had to analyze their businesses," Onofrio told AdvisorOne on Friday. "They knew they had to communicate with their clients and in doing that, put new processes in place."
Those processes helped advisors standardize their services, Onofrio said. "They're running more of a business than a practice."
Outsourcing some functions is another way advisors strengthened their practices, he added. "When they save time by outsourcing, advisors have more time to spend with their clients but they can also offer more services."
SEI found that nearly 40% of advisors consider themselves a wealth manager, rather than an investment advisor (8%). Thirty-seven percent consider themselves a financial planner, and only 16% customize their approach to each client.
Although about 25% of respondents said they wouldn't do anything differently to increase revenue in 2013, more than 26% said they would interact more with centers of influence. Acquiring new clients through small events (17%) and by pushing for referrals (14%) were other strategies, but nearly 13% said they would focus on retaining the clients they already have.
Their current clients are already giving them enough to do, the survey found. Nearly three-quarters of respondents said their clients had become more demanding since the recession began, and 70% said they spend most of their time working with existing clients.
"Clients trust them because of the relationship they've built with them. As advisors standardized their businesses, they reinforced that trust factor," Onofrio (left) said. He noted though, that investors are demanding more information from advisors before they begin a relationship, as opposed to trusting the word of a friend or acquaintance who referred them to the advisor.
