Community banks are trying to figure out what women want in wealth management, anyway.
A number of small banks have entered the wealth management business in recent years as they try to find new revenue sources amid low interest rates. They recognize that women now control a greater share of U.S. wealth even if they may fail to recognize when certain biases creep into their marketing.
"You would be missing a huge piece of your potential client base if you ignored the decision power already in play from women," says Renee Newman, wealth management director at the $9.3 billion-asset Sterling Savings Bank, a unit of Sterling Financial (STSA) in Spokane, Wash.
"There are more women in the workplace," says John Depman, national leader of regional and community banking at KPMG. "More women are breadwinners and more are controlling household finances. There's an increased need to address this customer base."
Roughly 40% of U.S. households with children under the age of 18 have a mother who is the sole or primary breadwinner, according to a study by the Pew Research Center. This is quadruple the proportion in 1960 and the highest ever recorded.
Other research could serve to help banks tailor their marketing of wealth management services to women. For instance: women are less confident than men about their knowledge of financial products and slightly more likely to use a financial advisor, according to a survey by Prudential. Just 20% of female breadwinners feel very well prepared to make wise financial decisions, highlighting an opportunity for banks to better serve female clients, industry experts say.
"For decades, banks have been run by men, for men, resulting in the approach to serving clients being more male centric," says Kathleen Burns Kingsbury, a wealth psychology expert and behavioral change specialist.
"Women value relationship banking and financial services," Kingsbury adds. Community banks "may have an advantage because they historically have been more relationship-based than other banks."
There is a tendency to follow stereotypes in marketing wealth management services to women, industry experts say. For instance, there is a historical belief that women prefer to work with female advisors, but that is not always the case. Though data shows women tend to be more risk-averse than men, it could be detrimental for an advisor to assume this without getting to know an individual client's goals and personality.
To connect better with women, its important for a bank to hire employees who reflect the bank's customer base, says JP Nicols, a partner in the wealth management practice at Bank Solutions Group. "Our industry is not as diverse as it should be, and that is especially true in the wealth management space," Nicols says.
"At the risk of oversimplifying, observe and listen very carefully to your customers' wants and needs, stated and unstated," Nicols adds. "The right solutions are likely a mix of the tried and true, [combined] with some new insights for unique needs."
It is important to reflect on the client experience to make sure that customers' needs are being met, says Sharon Allen, president of Sterling Wealth Management in Champaign, Ill.
Bank managers must also understand their markets and core client base, Newman says.
Banks need to prevent overt and subtle biases from slipping into client dealings. Susan Martore-Baker, president of Cambridge Trust Co. of New Hampshire, a unit of Cambridge Bancorp in Massachusetts, recalls a female client being told by a rival to advisor to check with her husband before making a decision.
"A lot of these husbands wouldn't want to be told that," Martore-Baker says. "Women feel just as strongly."
Even unconscious biases, such as mainly addressing the husband in a meeting, can negatively influence an advisor's relationship with a couple. Almost 25% of women told Prudential that they would discontinue a relationship with a financial professional if their spouse died.
Preventing issues from souring a relationship requires ongoing training, says Kathy Anson, regional sales manager at Sterling Savings. Anson, who oversees financial consultants, routinely observes advisors and gives feedback to strengthen interactions.
Sterling Savings hosts events specifically for female clients, ranging from a book club to educational sessions on financial topics, that let women interact and learn in a relaxed atmosphere. The response has been overwhelming; more than 150 women are on a waiting list for the book club, Newman says.
Such events are a great way to recruit new customers, though it is also important to make sure offerings fit with clients' schedules, Allen says. For female executives and professionals, Sterling Wealth organizes events that allow the women to also network, she says. The firm is also willing to meet with clients at their offices, she says.
Going the extra mile to reach female clients is worthwhile, experts say. Wealth management is highly competitive, so small banks must do more to stand out.
"Women like to be treated differently based on their uniqueness," Allen says. "If bankers can get their heads around that they will go a long way in being successful in serving women."