The wealth management industry has made great progress over the last decade. It was not long ago when pitching stocks to strangers over the phone was the norm.
Now, a combination of increased expectations on the part of consumers, regulators and the industry itself have propelled it to new heights where client-centric and comprehensive advice has become a business fundamental.
While this growth is a significant accomplishment, the industry still has a long way to go before it reaches peak customer centricity. To borrow a mountain climbing analogy, the industry has reached base camp at Mount Everest.
That's nothing to scoff at. It is a multi-week venture that starts in Nepal, requires a flight from Katmandu across the Himalayas to a small mountain airstrip in Lukla and then a weeklong trek beginning at an elevation of 9,000 feet, and 60 miles later ending at over 17,000 feet. Yet it is still only halfway up the mountain.
Research shows that the wealth management industry is also only halfway up the mountain. Despite great progress, the J.D. Power 2021 U.S. Full Service Investor Satisfaction Study found:
- 56% of clients said their advisor did not provide all the products and services needed to address all their wealth management needs,
- 33% said that their advisor did not understand their financial goals/needs and used terms they didn't understand, and
- 53% said they did not completely understand the fees being charged.
Here's the Problem
There seems to be a gap between where the industry is and its full potential.
