On average in the USA, 11 million formal business meetings take place every day and an estimated $37 billion dollars is lost in unnecessary meetings every year.
Through the never-ending developments and specialisations in technology, businesses of all industries are finding new innovative ways in which to optimise and automate their systems both internally and externally. It’s fair to say that those who are not, will be struggling with profit margins and client and employee retention in the near future.
Virtual advice is one of the more recent technological developments within the FinTech industry and is due to the ever-growing demand for better customer service while being as cost-effective as possible. A report by McKinsey & Company found that advisors to the “mass affluent” (assets between $100,000 and $1 million) have turned to the use of virtual services to manage a demographic that had previously been difficult to serve in a cost-effective manner.
In a previous discussion, we identified the growing market for financial advisors looking to serve the Gen Y, Millennial client. Yet, most traditional advisors are finding it difficult to penetrate this generation of digital natives who automatically expect SaaS (Software as a Service) to front their relationship with an advisor, in order to reduce the waste of precious time.
Gone are the days of rushing off to a meeting all for the sake of a signature or meeting with a client to walk them through an updated document. Now, clients expect these meetings to be over as soon as possible and could not bear the thought of being billed for travel costs, when the issue could be resolved in the comfort of their own home via a virtual office.
On a side note, for those of you still unsure about the credibility of digital signatures we wrote an article discussing this issue. Finding, that if the act of signing is proven via a present witness or audio confession of intent or video/audio recording the act, then the signature itself was less important. The signer can, in fact, produce a signature on screen or paper that lacks similarity of their “regular” signature.
The same report by McKinsey & Company told us that this segment of financial clients is becoming more comfortable with the use of virtual channel advisers, looking to receive high-quality digital advice. Advisors will soon find this market become a profitable core to their businesses.
McKinsey estimating that 42 million households worldwide, representing $66 billion in annual revenues across banking, borrowing and investing are ready for a virtual advice model.
40 to 45 percent of affluent clients who switched their primary wealth management firm in the past 24 months moved to a direct, digitally led firm – in many cases choosing to work with a phone based advisor at those firms.
Not only does digital advice provide significant growth but it also provides an opportunity for in customer satisfaction. When a successful virtual model is implemented these tools can serve as much as 40 to 50 percent in customer satisfaction which exceed those of firms who continue to use a person-to-person model.
Not only does virtual advice encourage growth, customer satisfaction and retention, it also:
- Reduces the risk of advisor and client attrition.
- Efficiently responds to the fluctuating demand for advice.
- Is a consistent and cost-effective way to make use of specialists.
- Helps identify, cultivate and onboard new clients.
- Can be used internally and for HR purposes.
For those looking to adapt their businesses in order to thrive through virtual advice, the horizon is bright. But, with a lot of services on offer and it’s important that you find a service that works cohesively with the functions of your business and expectations of your clients.
When working with the right partner you should be able to integrate virtual advice software as simply and informatively as possible and hit the ground running. We’d hate to think how much of that $37 billion your firm is losing through ineffective and unnecessary meetings.
Author: Orlando Werffeli