Portfolios to people: the evolution of adviser's alpha

09 October 2018 | Practice Management


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Donald Bennyhoff:

Research we've done at Vanguard finds investors value and reward advisers they highly trust with loyalty and referrals.

To differentiate themselves from their competitors, both robot and human, advisers should embrace relationship management as a crucial element of their practices and not just customer service.

What is relationship management?

Any adviser, whether digital or human, can guide investors to low-cost funds, which is the dominant trend in the industry. However, not all advisers are adept at the truly advanced skills, which remain uniquely human.

It's easy to see technology as a threat, but it doesn't have to be; professional advisers, unlike robo-advisers, can excel at the soft skills – valuing clients, respecting them, understanding their investment objectives and feelings. All of these are major contributors to building long-term trust and relationships.

Technology can reduce the time an adviser spends on routine administrative tasks and day-to-day activities around things like asset allocation.

This leaves more time for the adviser to spend developing lasting ties with their clients, ties that will lead to asset retention and referrals.

It's the human factor, cultivating trust, serving as the client's advocate and ally, providing the behavioural coaching that clients need; these are the tasks that can't be automated, and they're functions that can make the difference between a successful advice practice and an unsuccessful one. Thanks for watching.


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Investment Risk Information

The value of investments, and the income from them, may fall or rise and investors may get back less than they invested.

Important Information

This video is directed at professional investors in the UK only, and should not be distributed to or relied upon by retail investors. It is for educational purposes only and is not a recommendation or solicitation to buy or sell investments.

The information in this video does not constitute legal, tax or investment advice. You must not, therefore, rely on the content of this video when making any investment decisions.

Issued by Vanguard Asset Management, Limited which is authorised and regulated in the UK by the Financial Conduct Authority.


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