Wealth Management Strategic Update: September 2020 Review

October 2, 2020, Aaron Tellier

Wealth Management Strategic Update: September 2020 Review

October 2, 2020, Aaron Tellier

Wealth Management Strategic Update: September 2020 Review

October 2, 2020, Aaron Tellier

Wealth Management Strategic Update: September 2020 Review

October 2, 2020, Aaron Tellier

Wealth Management Strategic Update: September 2020 Review

October 2, 2020, Aaron Tellier

Wealth Management Strategic Update: September 2020 Review

October 2, 2020, Aaron Tellier

Wealth Management Strategic Update: September 2020 Review

October 2, 2020, Aaron Tellier

Many client and agency teams are currently working day and night crafting their 2021 brand plans. In a more normal year (remember those?), the process for data-driven marketers would start with a formal review of FY20 brand and channel performance in order to determine what to do i.e., decide which initiatives should be continued, stopped or re-imagined. But 2020 has been unlike any other year, throwing a wrench into typical testing strategies and learning agendas that would typically drive future focus areas and priorities. 

The abrupt circumstances brought on by COVID-19 have affected individual investors as well as Wealth Management firms and Financial Advisors. Investors have seen direct impacts on their portfolios. Firms have had mixed impacts: topline revenue is up due to increased trading, but overall net interest on AUM has seen declines, consistent with market performance. However, these are shorter term impacts. The longer term implication is that COVID-19 is forcing a re-making of Wealth Management along three critical lines:

  1. Rapid increases in the adoption of digital channels across generational divides:  With social distancing rules limiting face-to-face interactions with advisors, firms and their customers have been forced to engage remotely and digitally more than at any time in the past. Paradoxically, market uncertainties have made investors hungrier than ever for real-time, human interaction with their advisors.
  2. Shift toward comprehensive “total financial wellness” planning:  COVID-19 has only heightened consumers financial worries, making the value of professional advice and expertise clearer and more urgent to them. Holistic approaches (i.e., solutions for a broad set of financial needs including retirement, debt, spending, insurance, estate planning, etc.,) can provide a better experience for consumers, while at the same time providing a deeper, more enduring relationship for the Wealth Manager.
  3. Acceleration of customer-centric, remote delivery operating models:  Social distancing rules have forced firms to rapidly scale up their remote delivery capabilities. This has set the stage for a strategic re-set toward:
    • Fully digitally-enabled client interactions.
    • Digitization of internal workflows, procedures and controls.
    • Collaboration software that enables remote work and more flexible models for sharing expertise.

Wealth Management brands that take a longer view and invest in customer relationships, build differentiated experiences, nurture brand loyalty by eliminating friction points and deliver real value will see greater overall success.  And these elements are shifting to the digital space rapidly, emphasizing the need for brands to invest in their digital infrastructure, gain a better understanding of digital metrics, and differentiate customer strategy from what may have been successful prior to the environment we now find ourselves in.

All this change will force smart marketers to push beyond the boundaries of their tried and true playbooks and embrace new opportunities and capitalize on newly developed consumer interests.

Industry Insights and Trends

Listed below are recent industry insights and trends gleaned from recent news and actions from major wealth management companies.

Schwab launches free financial planning tool

Charles Schwab says it is now offering free digital financial plans to help investors move toward their retirement goals. All existing Schwab clients can use the self-guided tool, Schwab Plan, that the firm argues makes it “the only large retail brokerage to offer complimentary financial planning to all clients.”

For Schwab Plan, clients answer a few questions and in about “15 minutes, they’re able to generate a retirement plan that shows retirement goals and [the] probability of funding those goals, a comparison of current asset allocation to a recommended allocation … and suggested next steps to get and stay on track,” according to Chief Digital Officer Neesha Hathi. The new tool also can aggregate and factor in accounts held outside of Schwab.

The tool, which is available to clients for free, will directly compete with similar self-directed solutions such as Personal Capital and Mint.

wealth dashboard resized
Fidelity launches Bond Beacon, a digital fixed income trading solution for firms and advisors

Fidelity Institutional has announced the launch of Fidelity Bond Beacon, a comprehensive, fully digital fixed income trading solution that helps advisors manage all aspects of individual fixed income investing for their clients. 

Fixed Income has always been an integral part of portfolio construction, but in 2020, given the wild fluctuations in the stock market as well as bond-buying signals from the Fed, advisors’ have been hungry for new ways to trade bonds. Fidelity Bond Beacon helps advisors by providing:

  • Advanced portfolio management, construction and analysis
  • Risk analytics, conditional market scenarios and risk modeling
  • Post-trade reporting with portfolio analytics

You can check out Bond Beacon at go.fidelity.com/bondbeacon

JPMorgan Chase traders and bankers will keep ability to work remotely

Workers in JPMorgan Chase’s corporate and investment bank will cycle between days at the office and at home as the industry heavyweight with 60,950 employees keeps the ability to work remotely on a part-time basis.

With Wall Street preparing for more of its traders and bankers to return to offices next month, the announcement by JPMorgan could pressure other financial firms to offer similar arrangements. Banks are in constant warfare with each other over talent, and the industry often moves in lockstep when it comes to perks and salary. At Citigroup, some managers have begun sign-up sheets to gauge demand for a September return.

Millions of Americans wiped out emergency savings

While some Americans are saving more than ever before, a greater number of people are experiencing financial hardship as a result of the economic downturn prompted by COVID-19. Since the virus was declared a pandemic, 14% of Americans — roughly 46 million people — said they’ve used up all of their emergency savings, according to a new CNBC and Acorns Invest In You Savings Survey.


When broken down by age, older millennials fared the worst: Roughly a quarter, or 26%, of those ages 25 to 34 said they had completely depleted their emergency fund, compared with just 6% of boomers ages 65 or older, according to the survey of more than 5,400 adults in August. It may be a long time before Americans are able to replenish their savings.

Sources:  https://www.cnbc.com/2020/09/01/americans-are-more-savers-than-spenders-during-the-pandemic.html


Consumer Sentiment

Six months from when the COVID-19 crisis began in earnest in the US, Americans, while still experiencing prolonged shock and grappling with the realities of the pandemic, are beginning to live their new normal and even experience signs of recovery.

Many consumers feel the health crisis is stabilizing and are feeling more grounded in their personal lives as well. This is translating into greater concern for other pressing national issues, such as the economy and the nearing presidential election.  Consumers are tired of staying home and waiting to re-start their lives, many have already made life-event decisions, like deciding to move to the suburbs, going ahead with their wedding or starting their families. These “special moments” for consumers also translate to financial needs. Pent up demand is something many banks are already managing through with mortgage and equity products, but demand is also translating into new checking accounts, renewed focus on savings and investments, and opportunities for banks to ramp up their marketing and cross-sell efforts.

Consumers are split 50/50 about their comfort levels with going out in public since March and tend to feel more comfortable doing activities that are fundamental, like grocery shopping, exercising, or attending medical appointments. Conversely, activities that are discretionary carry higher levels of discomfort, like travel and beauty services.  Given that 80% of Americans say they can manage their money entirely without a bank branch, providing superior banking experiences in a digital environment is crucial, as well as marketing support that intercedes in “moments of truth” when customers really need more expert guidance available to enable them to take their next financial step.

For months now, consumers have told us they are paying more and more attention to brand responses to COVID-19. That has now leveled off, but consumers still expect brands to help put their safety first.  Consumers also want to see that brands are taking measures to ensure their employees’ safety and we’ve seen that come to life in some advertising, most notably in Amazon ads.

Offering discounts and value-added services to customers during this time continues to be a top desire from consumers.  Typical holiday shopping periods are being extended far earlier, with discounts and promotions being the norm and not the exception. Look for ways to add value to your customers and prospects that goes beyond your typical bank product and service levels in order to maintain table stakes competitive positioning.

Similarly, consumers want their brands to demonstrate and advertise about how they’re evolving to meet people’s needs during the crisis. They also want to see actions that brands are taking in their communities, charitable organizations and other causes. These are increasingly important to ALL consumers, where traditionally Millennials and Gen Z were the cohorts most interested in choosing brands based on their goodwill efforts.

Consumer concern over other national issues in addition to the health and economic crisis stemming from COVID-19 is growing. As November nears, the US Presidential election is a top issue as well as social unrest and racial inequality as police brutality against Black Americans continues to occur and make national news.


For months now consumers have told us they are paying more and more attention to brand responses to COVID-19. Now, that has leveled off, with the number of respondents paying more attention decreasing by 10 points while those paying the same amount of attention against a higher baseline has increased by 13 points.


While more engaged in the US political landscape overall, most American consumers say they pay attention to brand’s political stances and that they are paying more attention during an election year especially.


Boomers are significantly less likely than other generations to be paying attention to the political stances of the brands they purchase. Interestingly, it seems that engagement with US politics does not directly correlate with attention paid to brands’ political stances.

Latest Trends

New personalization models are emerging

Organizations must change their personalization strategy: Businesses need to quickly update their understanding of individuals’ wants and needs, and quickly retire information that is no longer valid. Banks that give people the ability to steer their own digital experiences will be the first to understand what their new wants and needs are.

Digital Experiences must transform: Most digital platforms and digital experiences were designed to supplement in-person experiences, but demand is rising for shared digital experiences and digital communities.  It’s not just a matter of reacting to consumer needs based on data, but refreshing that data “in the moment” so that it is continuously improved to reflect evolving consumer needs.  For example, imagine a prospect searching for the a new checking account.  They finally purchase after doing all the research and weighing the pros and cons, and then they STILL get ads from all the competitors that they considered but did NOT select! Don’t be that bank. Look to future needs with more real-time data.  Some banks are even looking at emotion detecting technology to digitally read emotions on the consumer’s face and dynamically (using Artificial Intelligence) change their marketing in response to the consumer’s emotions.

Innovators: Tasting Collective, a subscription dining club, has pivoted from in-person dinners led by chefs in their own restaurants, to livestreamed cooking classes, led by chefs virtually. Health wearables: HEY Bracelet and Bond Touch, both wearable bracelets, are attempting to virtualize human touch. Usually sold in pairs, the bracelets can lightly squeeze the wearer or light up and vibrate when activated by their counterpart.

Sources: Accenture, Hubspot

Voice-activated assistant and smart workspaces use grows exponentially

According to ABI Research, the pandemic is expected to push global voice control device shipments to grow by roughly 30% in 2020 compared to last year.

Amazon reported that worldwide Amazon Alexa skill usage increased by 65% between April and June. Almost 34% of the total population owns a voice assistant, and according to eMarketer, in 2019, an estimated 111.8 million people in the US will use a voice assistant at least monthly.  In the US alone, 52% of voice assistant users say they use voice tech several times a day or nearly every day, compared to 46% before the outbreak, according to a report.

Technology, such as that seen in smart workspaces, is increasingly human-centric, blurring the lines between people, businesses and things, and extending and enabling a smarter living, work and life experience.  The more time people spend at home getting comfortable with their smart technology, the more trust they develop and the more they want the ease that voice banking skills provide.  When you wake up at 2 a.m. in a panic because you forgot to pay your credit card bill, you can just say, “Alexa, pay my credit card bill” and go back to sleep.

Aside from consumer convenience, consider too that the average time spent on basic customer inquiries such as balance requests and transaction updates consumers is approximately 52% of customer service call center time.  The savings from voice handled transaction questions could potentially be worth billions in savings to the financial services industry.

Podcast ad spend is on the rise

US podcast advertising will see especially strong growth this year, relative to ad spending for all other audio formats. We estimate that podcast ad spend will grow by 10.4% to $782.0 million this year, compared with a 17.0% drop for digital radio outlays overall. US podcast ad spend is still set to surpass $1 billion in 2021. 

Podcasts will make up around one-fifth (21.0%) of digital radio ad spend this year, a large jump from the 4.1% share it had just five years ago. We forecast this growth will accelerate strongly in 2021, increasing by 44.9% to reach $1.13 billion in ad spend.

Many financial services organizations leverage some type of radio or audio advertising. With the growth in podcasts and the advertising within them, we believe that advertising on podcasts will continue to be harder to ignore.

Innovative Creative

Shown below are examples of innovative creative recently launched by different financial services companies.

Charles Schwab launches the “New York Sled Rangers” TV spot as part of their “Own Your Tomorrow” campaign. https://ispot.tv/a/ncD3


Fidelity Investments launched “When the World Gets Complicated” TV spot. When the world gets complicated, a lot goes through your mind, but Fidelity says that with Fidelity Wealth Management, your dedicated advisor can give you straightforward advice and tailored recommendations.  https://ispot.tv/a/ntja


Edward Jones launched “Challenging Market” TV Spot. Edward Jones acknowledges the current challenging set of market conditions, which is why it says it's ready to listen and help you find opportunity.  https://ispot.tv/a/nAow


What We See Working (and Why)

Financial Planning Tools

Way back in the early 2000’s and 2010’s, one of the primary advantages of working with a financial advisor was that they had access to sophisticated planning software. This software could analyze and project a client’s financial planning situation more efficiently and effectively than the advisor (or the consumer) could possibly do on their own. And the way it worked was that clients would pay a fee for the advisor to gather their data, input it into the software, and present them with a sophisticated report  i.e., the “Financial Plan”.

But now there is an ever-growing abundance of increasingly sophisticated software available online for free.  These tools are offered for free because they function as a “hook”: a way for consumers to engage with their finances and help attract (or retain) a consumer to the financial services firm offering the software. For example, Personal Capital, a fintech/online wealth management firm, has grown from $0 AUM at launch in 2009 to $12.5 Billion AUM as of June 2020, almost exclusively through the leads generated by their free (and award-winning) online personal finance tool.

And now the latest in the world of giving away planning software tools for “free” to attract and deepen relationships with current clients is Schwab. In September, Schwab announced the launch of Schwab Plan, available for free to all existing clients (prospects can get a scaled down version called “Financial Planning Hub”). Interestingly, Schwab is also growing its human financial planning offering:  Schwab Intelligent Portfolios Premium, which includes access to a live CFP professional.

The output of planning tools like Schwab Plan (or Personal CapitalMint or Fidelity’s Financial Planning Tools) can have genuine functional benefits, like providing simplified guidance on asset allocation, delivering performance dashboards that are easy for clients to understand, or providing automated portfolio rebalancing. But that’s not the most valuable piece because so many tools are provided for free, the “output” or “the plan” is rapidly becoming a zero-cost commodity.  What is valuable is the interpretation of the output of the planning tool, in other words, answering client questions like: What does this mean? Which parts are important? What do I do next? Will I be able to live the life I want? In other words, free online planning tools are a mechanism for driving better conversations between the firm/advisor and the client. And those can be better conversations with a prospective client, a current client, or even a former/lapsed client.  Better conversations are the root of better customer experiences, which are in essence “the product” that Wealth Management and Advisory firms deliver.

The upshot: the real value of financial planning is not the planning software/code and its output, nor in inputting the data into the planning software on behalf of clients (even though some advisors still charge for both!). The real value of financial planning is its ability to drive higher quality engagement and better conversations.

In conclusion, wealth management companies need to actively address marketing efforts given the new environment to both overcome today’s challenges while also capitalizing on new opportunities. “Navigating the new normal” will require revised marketing guidelines for the end of 2020 and beyond.


You might also be interested in:

You might also be interested in:

You might also be interested in:

You might also be interested in:

You might also be interested in:

You might also be interested in:

You might also be interested in: