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Shape Your Approach With Clients

NEW YORK - If it took more than 180 years for the bicycle to evolve into what it is today, one might argue that at roughly 35 years old, the wealth management industry still has some significant development left to go.

"The concept of wealth management, from end to end, is a relatively new one," Sebastian Dovey, cofounder of research firm Scorpio Partnership, told advisors and executives during the opening session at Invest 2015. "Not just for you as practitioners, but equally for the customer," Dovey explained.

Like the bicycle, Dovey said advisors should view wealth management as a product under development. It must be sculpted to meet the demands of the customer.

"You need to listen to them (clients) and act upon what they want as though they are consumers," Dovey said. "You just happen to sell financial products. It is a product at the end of the day." The robo-advisor, he explained, has more or less become the symbol of this process.


The industry, as a whole, controls 40% of the client market, Dovey said, relying on Scorpio research figures. "Of that 40%, 78% is with 20 of the most visible brands." This phenomena, he said, illustrates how much people trust a well-established product.

For the rest of the industry, which manages the remaining 20%, Dovey said more can be done to reach to a wider swath of clients.

"We have only scratched the surface in this industry," he explained. "We are doing well, but we could be doing a lot better."

With the development of robo-technology, the perception of the traditional wealth manager has already changed from a grey-haired man shaking hands with new young clients, Dovey explained.


Millennials and future generations of clients should be approached with a combination of patience and creativity, Dovey said. "It’s about getting them to engage."

As an advisor, you sell premium knowledge, and you sell the proven value of that knowledge that you possess, ultimately enabling clients to do better things, Dovey explained.

"One in four high-net-worth clients say they could make better wealth management decisions if they had a better understanding of financial matters," he added. And although advisors have selectively passed on that knowledge while developing client relationships, Dovey said that process needs to be codified.

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