“Predictive” CRM: Compete with Robo-Advisors by Providing Value They Can’t

Morgan Stanley recently announced they are implementing a new “machine learning-based system” that will make their financial advisors (of the human variety) more efficient. So, what does this really mean? Well, it essentially means that Morgan Stanley appreciates the fact that robo-advisors are creating a diluted marketplace, and that having an actual “relationship” with a client is no longer enough to assure loyalty to a financial advisor. To be able to forge that loyal relationship, advisors must offer something more; something the robo-advisors can’t. They need a crystal ball.

Sadly, human advisors don’t have one, either.

What Morgan Stanley is doing, though, is being proactive. They are providing added value to their clients by offering predictive technology. The theory behind this is that human advisors and their “algorithmic assistants” are more appealing than a software system that lumps clients in one big group. Software programs utilize limited data, allocating assets wholesale within each category solely based upon how they are profiled.

It’s clear that the folks over at Morgan Stanley are onto something, but does that necessarily involve customized, complex, and very costly technology to get them closer to that crystal ball? Or is it possible for your firm to achieve those same goals utilizing your CRM system?

Traditional CRM: It was fine before, but it’s can’t fight that fight any longer

If you have already been working with CRM within the financial services arena, then you are well aware of its capabilities. Typically, CRM has functioned as a control tool with a focus on asset aggregation, reporting, and managing relationships. Here at AKA, we have been implementing Microsoft Dynamics CRM systems for years, and we are confident that, regarding data integration via transfer agents, trade settlement systems, portfolio management systems, etc., no one can do it better than us.

However, the problem with traditional CRM systems—and this is not limited to Microsoft—is that they have not been able to add value for financial advisors when it comes to predictive relationship management. This is because, traditionally, CRM systems are on premises and therefore are limited to using internal data only—account information, roll-up information, and so forth. Because these systems couldn’t typically tap into external sources, they did not have the ability to offer either predictive analytics or machine learning. Quite simply, they just weren’t built that way.

Today’s CRM is super-charged: Who needs a crystal ball when they have machine learning?

If you’re thinking you have lost the battle with the robo-advisors, you might want to think again. Human advisors have an opportunity to demonstrate that they can offer so much more than managing a portfolio. They can help clients achieve their goals and their dreams. IF they get in front of the information that will enable them to deliver an amazing client experience that will leave the client wondering if they actually do have a crystal ball. That’s where today’s CRM comes in.

Taking advantage of the Cloud, the CRM capabilities in Microsoft Dynamics 365 can integrate instantly with multiple information sources and other systems. Microsoft offers Relationship Insights, which provides a super-charged financial services CRM that, in essence, turns it into a predictive tool and enables advisors to be much more proactive. Relationship Insights plays off Microsoft’s ability to manage both external data and the data you already have that is typically integrated into your CRM system, thereby taking CRM—and your client relationships—to a higher playing field by leveraging both AI and machine learning, as well as the Cloud.

CRM reaches out to advisors well in advance, based on parameters or triggers that you set in your system. These triggers allow them to make better, predictive decisions that benefit clients. Beyond simply monitoring your clients’ portfolios, this can ensure that action is being taken on trends happening in the earliest stages. Also, by monitoring social media, a more personalized, hands-on approach can be achieved. For example, let’s say an advisor notices one of their clients is posting a significant number of pictures of sailboats on their Instagram account. This tips off the advisor, who can reach out to the client to including a future boat purchase in their financial plan.

With this new level of technology in place, CRM shifts from a reactive approach to a predictive tool. It’s no longer a matter of “You didn’t meet your quota”—it offers an opportunity for improved client outreach and the likelihood of an improved relationship score. When you give your financial advisors the ability to make thoughtful decisions utilizing the limited time that they have, you are adding value to existing client relationships. You are also allowing your advisors to focus more time on those highly valued clients, thereby improving client retention.

Take THAT, robo-advisors!

Change the game and win: Here’s how

How to Compete with Robo AdvisorsEquipped with predictive technology like Relationship Insights, today’s CRM empowers your financial advisors. It gives them the ability to build on those valuable, human relationships with their clients, allowing them to focus on assisting them in achieving their goals and living their dreams. That is how you develop a loyal client for life.

Don’t play the robo-advisor game–learn how to change it. Watch our webcast, Competing with Robo Advisors: How to Carry a Bigger Book of Business While Providing Clients with a High-touch Experience.

Then contact our team of financial services experts to discuss your goals.