By Jerry Butler 



Are you aware of Robo Advisors? Robos are experiencing very good growth and taking market share from conventional distribution channels but so did discount brokers 30 years ago. Regulation, shrinking fees, increasing compliance yet the industry and many advisors continue to grow their businesses and build very successful practices. Why?

30 years ago you could open an account over the phone, the account form was one page, A signature was not required and you could buy the client an investment with no money in the account. Regulations have changed dramatically and we are not going back to the “old” days and those days were not necessarily better!



Consider the following threats to the way you currently do business:

  1. Many consumers currently consider investment advice a commodity. They see little difference between an independent advisor or broker or a bank or a “career agent”. That is why many will deal at the bank with an advisor with 15 – 20 ……… hours not years of experience. The reason is the amazing branding banks have done (they have had a 100 years!). Banks are trusted. The advisor might leave but the bricks are still in the same place therefore who sits in front of the client has become less relevant.
  2. Shopping on the internet has become ubiquitous and financial products are on the shelf as well. Many check out term insurance prices and follow their investments on the internet.
  3. Returns have been replaced by fees as the selling point for many institutions. Advertisements tout their lower fees and do not talk about returns. ETFs have become the vehicle of choice for many consumers, advisors and businesses.
  4. Right now, there is a large part of the population being neglected by conventional advisors. They are the younger person with little savings now. These are the people who use technology for every facet of their life. They depend on technology and that way of life. Will they continue to use technologies for their financial decision making when they have lots of money?
  5. Technology is cheap now and always getting cheaper especially on a per transaction basis and cost of storage. Large businesses with generic products have economies of scale and can manage hundreds of thousands of clients that can be slotted into a finite number of boxes where the algorithms do the bulk of the work. Artificial intelligence will continue to carve out “tasks” in our industry giving a competitive advantage to the large and well capitalized.
  6. The middle of the distribution channel – broker, dealers, mga, exempt market dealers – is squeezing advisors. They are cutting payouts and pushing costs and liabilities down to the advisor. While they are raising revenue expectations they are also cutting payouts. Lower revenues and higher expenses appear to be the trend. The survivors who will thrive are the advisors who are willing and able to change and adapt.
  7. Trust. Our industry has done very little to place the advisor in the community’s mind eye as a knowledgeable, helpful and trustworthy professional. As a CFP I wonder where and what that organization is doing. I see very little return on that “investment” both from my perspective and from the “client” perspective. That also goes for Advocis (though they have done some) and the Canadian Securities Institute.

I am sure I am missing many other threats but the above should give us all pause. Until the early 90’s the consumer marched down to the closest bank or credit union and got a guaranteed double digit return. Then they all poured into mutual funds and basically got double digit returns through the 90s. Expectations of the consumer were off the charts. “Snap back to reality!” The 80s and 90s were not the norm. Consumers are better educated and more aware of choices and competition in the market place.


An important issue to remember is that technology like Turbo Tax or Quick Tax did not put accountants or tax preparers out of business. But the accountants who did not evolve into a more sophisticated business model did feel the pain. There are always disruptors in every industry. It is important to look at your business model and your skill set and figure out how you can change your business to bring a value added proposition to your clients.

Do not forget that many people want personal service and most need it. Statistically we know that individuals with an advisor save more and get better advice therefore advisors need to keep evolving to the new ways of the industry

Here are some opportunities as I see it:

  1. Join the lower total fees revolution. Change your compensation model and show your clients how you can give better advice and competitive fees. What is your value proposition?
  2. Your business model has to reflect your strengths. Are you a generalist? Maybe a financial planning model. Are you or can you be a Specialist whereby you stand out from the crowd? There are many successful business models in our industry but the model has to fit your strengths. Know the different business models and figure out what works for you.
  3. Know your target market. Know who they are, where they are and what they want (need). I think too often we define a market by the size of their savings. It is impossible to only prospect million dollar accounts because the owner can be from all walks of life. Your target market is who more than how much. If you are targeting trades people or brain surgeons – than you will know where to find them. The other factor is what are your interests? Your best clients will be the ones with the same interests. You can translate your hobbies into friends and maybe clients.
  4. Have a clearly defined Service Proposition and how to communicate it to clients. How are clients treated? How many touches? How many appointments? Be sure your team is on the same page. Compensate staff based on the service of clients expected and provided.
  5. Be more than a one or two trick pony. Don’t just work with investments and insurance to replace income. Bring more to the table. If you have a situation outside of your comfort zone – have a referral ready (Center of Influence).
    That can cover mortgage, income tax, property insurance, debt management, estate planning, succession planning, etc. – become the relationship manager for all things financial.
  6. If you have a speciality and are in a niche market than that should be communicated to your target market. Your target market may be other professionals to refer to you. Know your value added.
  7. CRM. This is the most important feature (especially to increase value) no matter what your business model. This gets everyone on your team on the same page.  This is both in the client’s personal life and their financial life. You should know that Bill is a hockey fan and that his mortgage term is up in 3 months. One of the most ignored facets I encounter is advisors who want to grow their business but do not have a prospect list. Build a list with social media. In addition, the more you know about your prospects – the better chance they become a client (especially if their interests are congruent with yours).
  8. Use technology as a way to lever sales and service. Financial planning, contact management, investment analysis, income tax software, etc. can all be used to efficiently and effectively help you with your clients. Present information with charts and graphs – most people are visual learners.
  9. Have a Strategic Marketing Plan. Make social media part of your marketing. Relationship Marketing is the most effective business builder right now. It does not matter who your target market is as you can create touches with clients and build a prospect list. Host client education and appreciation nights. The more touches the better. Your marketing plan should have a referral program; identify centers of influence, charitable function projects, etc. The most important aspect = measure and monitor the results comparing budgeted and actual. Analyze how you are doing and know which areas to improve.
  10. Think outside the box. Offer free financial planning advice to your client’s adult children. Show them the benefit of starting early. Have their tax returns
    done. What differentiates you from your competition? Find the value added and tell everyone.
  11.  Educate and communicate. Tell your clients the different options they have available to them. Explain products and compensation and alternatives. Make your clients feel you are not hiding anything.
  12. Clearly communicate your value added every chance you have. You and all your employees should be able to concisely and clearly explain your value proposition.
  13. Bottom line – don’t have a book of business; have a business.


When CRM 2 started being bandied about Queenston got tons of calls from the arrogant – advisors will be running for the hills. We told the uninformed that Financial Advisors are resilient, knowledgeable and able to adapt. And you have!!

The next disruptor will result in anxiety but be met with the same adaptable business savvy.

Queenston has been successfully helping our clients increase their businesses value with several of our services. Check us out.


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