7 trends reshaping financial services

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Information about 7 trends reshaping financial services
Economy & Finance

Published on November 23, 2009

Author: gerrileder

Source: slideshare.net

Geraldine D. Leder June 2009

1 Populist backlash rips the wealthy 2 Trust is broken, value is compromised 3 Cost-conscious clients rethink going it alone 4 Tax burden will be oppressive 5 Winners and losers emerge in distribution 6 Digital is operating force in 21st century 7 Winners use crisis to review, regroup, reform 7 trends reshaping financial services

7 trends reshaping financial services

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 industry’s image and standing Implication: Government action has become a wild card in the business model

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 industry’s image and standing

Implication:

Government action has become a wild card in the business model

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

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

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

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

4. Tax burden will be oppressive Tax burden changes wealth/consumption habits for ourselves and our clients One-third of voters (taxpayers) pay no income tax and this number is rising 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 their income. (Heartland Institute) Implication: Lower returns + higher taxes = bleak prospect. Provide insight and help before they need it

Tax burden changes wealth/consumption habits for ourselves and our clients

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

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 their income. (Heartland Institute)

Implication:

Lower returns + higher taxes = bleak prospect. Provide insight and help before they need it

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.

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.

Distribution prediction: winners & losers Source: Predictions by Chip Roame, Tiburon CEO Summit XVI- 4/09 Gainers Online financial services Independent reps Fee-based financial advisors Unclear DC plans Retail banks Discount brokers Losers Wirehouses Investment banks Investment consultants

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

But what about the day AFTER tomorrow….?

Variable Service Model “straw man” Source: LederMark Communications, LLC High touch Systematic contact Annual review Go to meeting/video conferencing Medium touch Online trading Chat and instant messaging (dedicated coverage) Online collaboration Education/non-sales seminars and webinars Automated Call center & live chat service Online trading Education/training

Systematic contact

Annual review

Go to meeting/video conferencing

Online trading

Chat and instant messaging (dedicated coverage)

Online collaboration

Education/non-sales seminars and webinars

Call center & live chat service

Online trading

Education/training

6. Digital is operating force in 21 st 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 social media. Use this unlimited ability to segment and personalize to grow your business, cut costs, win advocates

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 social media. Use this unlimited ability to segment and

personalize to grow your business, cut costs, win

advocates

 

Companies are reconfiguring marketing budgets Source: Marketing Sherpa, Marketing and the Economy Survey Methodology: Fielded September 24-29, 2008. N=382

7. Winners will use the crisis to review, regroup, reform Seismic changes in our country’s economic system will restrain growth as far as the eye can see Brands that show courage to rethink all business assumptions will have the best chance for success Innovation: new service model, pricing structure, business model and client segments Grandfather current advisors and rethink model for the future Don’t 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

Seismic changes in our country’s economic system will restrain growth as far as the eye can see

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

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

Grandfather current advisors and rethink model for the future

Don’t 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

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 models Experiment with social media -- blog baby blog! Nurture a more client-centric culture – speak out against business practices that fail our clients, increase dialogue with all clients, young ones especially What else is “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 models

Experiment with social media -- blog baby blog!

Nurture a more client-centric culture – speak out against business practices that fail our clients, increase dialogue with all clients, young ones especially

What else is “next”?

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 and analysis 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 retail investors

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 and analysis

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 retail investors

Contact us LederMark Communications, LLC 401 Washington Avenue, Suite 600 Baltimore, MD 21204-4837 Gerri Leder, President [email_address] 443.279.7901 Fran Minakowski, Managing Director [email_address] 443.279.7903 Heather Koziol, Administrative Assistant 443.279.7904 Facsimile: 410.832.8883 [email_address]

LederMark Communications, LLC 401 Washington Avenue, Suite 600 Baltimore, MD 21204-4837

Gerri Leder, President [email_address] 443.279.7901

Fran Minakowski, Managing Director [email_address] 443.279.7903

Heather Koziol, Administrative Assistant 443.279.7904

Facsimile: 410.832.8883 [email_address]

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