Copy of 7 Trends Reshaping Financial Services

8/8/2019 Copy of 7 Trends Reshaping Financial Services

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Geraldine D. Leder

June 2009


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1

Populist backlash rips the wealthy2

Trust is broken, value is compromised3

Cost-conscious clients rethink going it alone4

Tax burden will be oppressive5

Winners and losers emerge in distribution6

Digital is operating force in 21st century

7Winners use crisis to review, regroup, reform

7 trends reshaping financial services


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1. Populist backlash rips the wealthy

Populist sentiment sours for top income brackets

Perception gap widens between wealthy vs. working families

Wall Street has gone from revered to reviled in eight months

We lack heroes to rehabilitate the industrys image and standing

Implication:

Government action hasbecome a wild card in thebusiness model


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2. Trust is broken, value is compromised

Innocence lost big job to regain trust and reestablish value

Dissatisfaction spreads like wildfire online

Brand confusion and merger fatigue prevail

Implication:

Time to sharpen the

meaning and value in full-

service relationship.

Clarify the brand promise,

what firm stands for


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3. Cost-conscious clients rethink investing on own

Cost is an issue in the absence of value

Online account openings up!

Fee compression is near certainty

Clients will dictate the terms of engagement

Implication:

More investors want

investment firms to

help me invest with you

argues toward multiple

business models

*Spectrem Affluent Marketing Insights 2009


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4. Tax burden will be oppressive

Tax burden changes wealth/consumption habits for ourselves and ourclients

One-third of voters (taxpayers) pay no income tax and this number isrising

Preservation of wealth from taxation requires attention, focus

Wealthy retired people change their state of residence to avoid high

tax states in favor of places where they can keep more of theirincome. (Heartland Institute)

Implication:

Lower returns + highertaxes = bleak prospect.Provide insight and helpbefore they need it


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5. Winners and losers emerge in distribution

Distribution drives opportunity

Innovation and long term focus are keys to staying alive

Lower margins will mandate bigger books, doing more with less

Need NEW clients and client segments

Implication:

Throw out conventional

thinking about models,

products, compensation

and client targets. Learn

from growing providers.


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Distribution prediction: winners & losers

Source: Predictions by Chip Roame, Tiburon CEO Summit XVI- 4/09

Gainers

Online financial servicesIndependent repsFee-based financial advisors

Unclear

DC plans

Retail banksDiscount brokers

Losers

WirehousesInvestment banksInvestment consultants


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But what about the day AFTER

tomorrow.?


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Variable Service Modelstraw man

High touch Systematic contactAnnual reviewGo to meeting/video conferencing

Medium touch Online tradingChat and instant messaging (dedicated

coverage)Online collaborationEducation/non-sales seminars andwebinars

Automated Call center & live chat serviceOnline tradingEducation/training

Source: LederMark Communications,LLC


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6. Digital is operating force in 21st century

Companies, advisors will use social media to:

Market into customer communities

Leverage voice of consumer

Educate, engage, encourage

Become more customer-centric

Implication:

Experiment with socialmedia. Use this unlimitedability to segment and

personalize to grow yourbusiness, cut costs, win

advocates


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Companies are reconfiguring marketing budgets

Source: Marketing Sherpa, Marketing and the Economy SurveyMethodology: Fielded September 24-29, 2008. N=382


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7. Winners will use the crisis to review, regroup,reform

Seismic changes in our countrys economic system will restraingrowth as far as the eye can see

Brands that show courage to rethink all business assumptions willhave the best chance for success

Innovation: new service model, pricing structure, business modeland client segments

Grandfather current advisors and rethink model for the future

Dont let the crisis go to waste!

Implication:

Restore prosperity

through technology for a

better, more client-centric

model, improving firm-

client dialogue, speaking

out against bad industry

behavior


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What to do next.

Continued cost focus

Work on the new model time is a-wasting

Look to different clients, not to squeeze more from existing ones

More teams, bigger books

More business specialization, gender/ethnic diversity

More choices among service modelsExperiment with social media -- blog baby blog!

Nurture a more client-centric culture speak out against businesspractices that fail our clients, increase dialogue with all clients, youngones especially

What else is next?


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How LederMark can help

We work with broker-dealers, RIAs and mutual fund companies in the following areas:

Consulting services

Strategy positioning firms, businesses and products

Qualitative research exploring market needs, from research design through facilitation andanalysis

Marketing project management examples include:

fresh look

outsourcing

marketing campaign development

Marketing communications

Integrated marketing campaigns/projects

Creative services and production

Content development

Selective financial writing

repurposing institutional content for other audiences: e.g., financial advisors or retailinvestors


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Contact us

LederMark Communications, LLC401 Washington Avenue, Suite 600

Baltimore, MD 21204-4837

Gerri Leder, [email protected]

Fran Minakowski, Managing [email protected]

Heather Koziol, Administrative Assistant443.279.7904

Facsimile: 410.832.8883 [email protected]
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]

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Copy of 7 Trends Reshaping Financial Services