March 19, 2014

How to Monetize Client Centricity for All Types of Customers

Bhuvanaa Shreeram
Certified Financial Planner, Plan2Prosper

In response to Suresh Sadagopan’s article of “CFP Career – From the Depths of Despair” I’d like to share this little insight.

We Financial Planners invest time to enhance knowledge, set processes and systems and set very high standards on quality for ourselves. We believe everyone out there needs a comprehensive look at their finances and should ideally pay and get high quality unbiased advice. We feel uncomfortable to be product sellers and don’t fit in relationship jobs at banks or insurance companies.

The fact is that there are different types of consumers of financial services. Different types of consumers have different needs. And by needs I don’t mean – debt management or investment planning needs. I don’t even mean that some need to be cajoled, some need education while some need tough talking too. What I mean is that – not everybody needs a lot of attention and customization.

If we were to segregate all consumers of financial services based on their knowledge levels on matters related to personal finance that would look something like given here.This categorization has got little to do with education levels, background, income levels or net-worth of customers. There could be some patterns there but not enough to generalize.

Types of Customers based on Knowledge Levels

Client Types based on Knowledge

There are financial service providers – our own fraternity with different skill sets called advisors / agents / brokers or whatever else name, serving each category of clients here in different ways. Skills required to handle a “Blissful” is very different from those required to handle an “Evolved”. By skills I mean not just technical skills (which of course is very important) but also capability to articulate view points, patience, willingness to help and the ability to influence.

Armed with a CFP certification in hand, most of us straight away jump to the top of the perceived skill set and expect clients to also jump right up there. We exclude a large part of uninitiated clientele from our scope of activities by building service offerings that are so elaborate and detailed and hence expensive.

While every client may not want “highly customized advice” or “a lot of personal attention” it is only true that every consumer of financial service deserves client centric advice. They should be served based on what they need and not based on what the advisor needs. Everyone needs something that is simple, agreeable, relevant and actionable. They all need their advisors to keep their interests in mind and in some cases not much more than that.

There is enough effort going on to move consumers and advisors up the value chain – by media, by manufacturers and a lot of well meaning advisors to educate clients about financial planning and the merits of getting paid advice. There are certifications and regulatory requirement essentially pushing advisors up there. We educate them but we don’t know how to work with them.

The problem statement in the industry if it can be summarized would sound like this – “we haven’t yet cracked how to ‘monetize’ client centricity”. We figured out how to monetize customization and enhanced attention by making our services so valuable that clients will pay for it and the “evolved” ones do. As product sellers we monetize our services well enough, but not necessarily by being client centric. And we don’t know how to work in a client centric manner with the not so evolved and yet make business sense.

Any solutions here?


Authored by,

Bhuvana Shreeram

Head  Knowledge Hub
Ffreedom Financial Planners

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