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The Science Behind Optimizing Financial Advisor Interactions
by Anu
On a frigid day in January of 2009, a conversation returned me to the spring of 1994. Math 54, or Linear Algebra, or specifically linear equations, enables us to solve multiple linear equations simultaneously.
So, on this day, I was discussing the optimal advisor outreach strategy with a client. In the past, when this firm 'learned' of a new advisor, the sales analytics team tried to add four wholesaler visits in the first year. Based on one-year potential flows from this new advisor, the answer was binary: yes or no. Either the wholesaler responsible for the associated territory visited the new advisor, or not.
Now the firm is looking to consider multiple avenues for providing coverage to new advisors:
- External wholesaler visits
- Hybrid wholesaler coverage
- Outbound sales desk coverage
- E-mail campaigns
- Web coverage
Through myriad data sources (Coates Analytics, National Accounts relationships, etc.) the firm collected investable assets and advisor AUM grow to model opportunity for a shift of new sales to their firm. Based on the potential flows and receptivity to communication channel, the firm will design a communication plan with any combination of the above. This enables the firm to scale distribution, reach more advisors, improve advisor feedback, and save money.
Optimizing those channels is a series of linear equations. As we wrote in Service by Segmentation and in previous posts, growing distribution does not necessitate growing wholesalers.
So all this brings me back to spring time in Berkeley: Math 54, Natalie Merchant at MLK Auditorium, eucalyptus in bloom, March Madness, ok, ok, sorry -- I digress.