You CAN Compete with Robo-Advisors: Capitalize on Today’s “Predictive” CRM to Provide Value the Robos Can’t

Recently, Morgan Stanley announced that it is implementing a machine learning-based system to make its financial advisors (the human ones, that is) more effective. What does this mean? It means Morgan Stanley understands that robo-advisors are diluting the market in a big way, and having a “relationship” is no longer enough to keep clients loyal to financial advisors. Human advisors need to be able to offer something robo-advisors can’t: a crystal ball.

Then again, unfortunately, human advisors don’t have one, either.

Machine LearningBut what Morgan Stanley is doing to help its advisors be more proactive—thus, providing more value to their clients–is adding predictive technology to the mix. The theory is that human advisors with “algorithmic assistants” will be preferable to software that clumps clients together using limited information and allocates assets wholesale for each category, depending on how they are profiled.

They are definitely onto something over at Morgan Stanley, but does it necessarily require customized, complex technology (which was not cheap, I can assure you) to get closer to that elusive crystal ball? Or can your firm achieve the same goals with—surprise, surprise—your CRM system?

Traditional CRM: It did what it needed to do before, but it’s no longer fighting the fight

Those of us who have worked with CRM in financial services know what it can do. Traditionally, it has functioned as a control tool—focused on asset aggregation, managing relationships, and reporting. At AKA, we’ve been implementing Microsoft Dynamics CRM systems for decades, and we will argue that, when it comes to data integration from transfer agents, portfolio management systems, trade settlement systems, and the like, nobody does it better than we do.

The trouble is, traditional CRM systems (not just Microsoft, but all of them) have not been able to add much value for financial advisors in terms of predictive relationship management. This is because traditional CRM systems have been on premises, limited to using only internal data—roll-up information, account information, and so forth. These systems could not tap into external sources, and they did not have the capability to offer predictive analytics and machine learning. They simply were not built that way.

Today’s super-charged CRM: With machine learning, who needs a crystal ball?

But if you think you’ve lost the war with robo-advisors, think again. Advisors have a golden opportunity to show that they aren’t just managing a portfolio—they are helping clients achieve their goals and live their dreams. To do this, they simply need to get in front of information so they can provide such an amazing client experience that the client begins to wonder if they actually do have the ability to see into the future. And today’s CRM can help them do it. In fact, what CRM can offer today is, quite frankly, mind-blowing.

Capitalizing on the Cloud, the CRM capabilities in Microsoft Dynamics 365, for example, is instantly able to integrate with other systems and information sources. Microsoft also offers Relationship Insights, which super-charges CRM and turns it into a predictive tool that adds value by being proactive. Relationship Insights brings in Microsoft’s ability to manage external data as well as the data you have traditionally integrated into your CRM system, taking CRM—and client relationships—to the next level by leveraging AI and machine learning as well as the Cloud.

Based on parameters or other triggers you set in the system, CRM will reach out to advisors well in advance—allowing them to make smarter, predictive decisions that benefit their clients. Rather than just monitoring their clients’ portfolios, they can ensure action is taken on trends in the very early stages. And by monitoring social media, they can provide even more personalized guidance. For example, an advisor notices a client is posting lots of pictures of sailboats on Instagram, so he (the advisor) reaches out to discuss whether the client might want to include buying a boat in their financial plan.

With this new layer of technology, CRM changes from reactive—you’re not meeting your quota!—to a predictive tool that allows for improved outreach and a much higher relationship score. The minute you enable a financial advisor to make better decisions with the limited time they have, you’re adding more value to their client relationships, allowing them to focus on those clients who are most important, and helping retain them.

So, what do you think of THAT, robo-advisors?  Not much, probably, since they don’t really think.

Learn how to change the game

In short, today’s CRM, armed with predictive technology like Relationship Insights, empowers your financial advisors to build on those precious, human relationships with their clients, focusing on helping them achieve their goals and live their dreams. That’s how you win a client for life.

So, stop trying to play the robo-advisor game–and learn how to change it. Watch our webcast, Competing with Robo Advisors: How to Carry a Bigger Book of Business While Providing Clients with a High-touch Experience.

Then talk to our team of financial services experts about your goals.


By | 2018-05-01T13:20:47+00:00 July 12th, 2017|Sales & Service (CRM)|0 Comments
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Contributor: Tom Berger

With 20+ years of field experience, Tom Berger is Vice President of Financial Services for AKA Enterprise Solutions.

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