Brick & mortar financial advisors are going extinct.
For as long as we can remember, financial advisors have been taught to have an office on main street, go to networking events, cold call, door knock, and drive tens of thousands of miles.
Well, those times are quickly becoming nothing but a bad memory as we are presented with one of the best opportunities ever as advisors and an industry.
A Global Megatrend
Since the early 2,000’s the human race has been in the midst of a megatrend. Megatrends are transformative changes that happen on a global scale. We can’t fight them. Human behavior actually changes, and we all know that humans are a stubborn species. Still, once we evolve, we don’t go back.
The technological evolution we have seen since the late ’90s, perpetuated this megatrend perpetuated this megatrend. Technology has grown and continues to grow at an exponential rate.
This growth has empowered the consumer to change how they consume virtually all of the products and services they need.
Consumer expectations, preferences, and demands have changed in virtually every other aspect of their lives and will continue to change. So, it is only natural to want their financial advice, products, investments, and insurance the same way.
McKinsey&Company published a report, The Virtual Financial Advisor, in 2019 that clearly shows how more and more people prefer virtual advice over the outdated ways of doing things from 1985.
The Virtualization of Financial Advice and COVID-19
The Pandemic that hit in 2020 disrupted so much of what we were accustomed to. Yes, there are and continue to be many issues that we must deal with, but there are also some silver linings. One being that COVID-19 forced the evolution of the financial advice industry.
It forced advisors to work from home. But, financial advice was still just as important, if not more, given the challenges we were all facing. The consumer/client will always value Human Advice over an algorithm for obvious reasons, but the way they get this advice has changed.
The 2020 “work from home” experiment proved beyond a reasonable doubt that we could indeed thrive virtually if we have the right infrastructure in place to do so. Virtual meetings work. Technology has made this possible to the point of making it enjoyable and effective.
The perfect storm of 2020 showed Advisors what the consumer has known for some time. Virtual advice is not only possible but also becomes the preferred way for people to conduct business. Not only does it save clients time and is more convenient for them; it is also of tremendous value to Advisors.
Advisors can now reach more potential customers.
For example, my organic LinkedIn posts reached over 1 million people in 2020; good luck trying to cold call that many people! Advisors can ditch the expensive offices, save money on overhead, and pivot to investing in better tech to serve their clients with an amazing experience regardless of physical location.
The World Has Changed
Whether we want to admit it or not, the world has changed. The financial advisor of the future has a choice. Evolve or stick their head in the sand and slowly go extinct. This choice is much more than the dinosaurs had; advisors really must take advantage of the massive opportunity right in front of them.
Those that evolve will thrive. Those that don’t will slowly go out of business.
Here’s to a bright future for us all.
Best Regards,
Derek Notman
