To Serve Next Gen Clients, Advisors Must Embrace the ‘Age of the Creator’

People follow people, not brands.

(Illustration by RIA Intel)

(Illustration by RIA Intel)

When I finally “cut the cord” and freed myself from cable, it took my 13-year-old son nine months to notice the change. The reason it took so long is because he chooses to consume content created by his peers on Snapchat, TikTok, Twitch, or YouTube. My son doesn’t identify with big-budget films and TV shows — he likes videos created by people he finds relatable.
I found my son’s reaction interesting because I noticed that my friends and I share his content-viewing preferences and habits. I typically gravitate toward Twitter and blogs, or podcasts created by my peers. I prefer listening to Ritholtz Wealth Management’s Michael Batnick and Ben Carlson discuss business and the markets on their Animal Spirits podcast, or reading a blog post authored by one of my personal connections (often made through social media), over listening to newspaper podcasts and reading blogs by authors I don’t know more personally. Digital content from news organizations is still highly sought after for its speed, authority, and investigative prowess, but independent content creators are providing a more relevant, personalized complement.
And I’m not the only one. Take Tesla, for example. On Twitter, Tesla has 6.1 million followers, but Elon Musk has over six times as many. This also extends to financial organizations. The Charles Schwab brand has 103,000 followers on Twitter, but Liz Ann Sonders, its chief investment strategist, has 143,000 followers.
Why? Because people follow people, not brands. We identify and socialize with people, not companies. We prefer human, personal connections instead of more general, impersonal ones.
Today’s technology platforms can make any individual creator accessible to the entire world, allowing consumers to select whatever we want, based on our preferences and areas of focus. And this has led to what I call “The Age of the Creator,” a new type of consumption that some have already mastered but that financial services need to better embrace.
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Personalized content is not just for entertainment. It’s changing the way we shop; many people are choosing to buy personalized creations from Etsy over something off the shelf at a department store. It’s changing how we spend our leisure time; big hotel chains are out, unique Airbnb stays run just the way we like, by small business owners, are in.
The COVID-19 pandemic has accelerated this and spawned more creators. TikTok recently announced that as of August 2020, its total monthly active users in the U.S. had surged to more than 100 million, a massive increase over the 11 million Americans who used TikTok on at least a monthly basis in January 2018. As of August, more than 50 million Americans use TikTok on a daily basis.
So, what impact will this trend have on financial services?
This psychological shift to a preference for creators has one obvious beneficiary: independent financial advisors. Because individuals are more relatable than institutions, advisors should lead with their personal brand — something that might be difficult or forbidden at large companies.
Those big institutions will need to adapt to these changes in consumer preference and behavior. For example, clients may want to create their own financial plans online rather than having one prepared for them. Clients and prospects might also expect information and services tailored to their specific needs and goals to evolve throughout their relationship with an advisor.
The interest in aligning investments with personal values — by utilizing environmental, social, and governance (ESG) or impact investing products — is also an outcome of “The Age of the Creator,” and will likely continue to increase. Envestnet’s impact strategies focused on gender and minority diversity have increased 84% over the year-prior period, as of July 31.
Furthermore, according to the Capgemini World Wealth Report 2020, high-net-worth individuals plan to allocate 41% of their portfolio assets to sustainable investment products by the end of this year, and 46% by the close of 2021. Nearly half of ultra-high-net-worth individuals under 40 surveyed by Capgemini expressed interest in sustainable investment offerings.
As we move further into the Age of the Creator, and witness more personal online ingenuity, creativity, and independence than ever before, advisors and other financial services professionals need to ask themselves how their products and services measure up.
Will the preference for personalized experiences lead to a shift away from passive, packaged products? Maybe. But products and services which can be customized to give investors more control and independence are definitely more attractive to today’s consumers. In order to position themselves as essential advisors to clients of the future (like my 13-year-old son) — as well as the clients of today taking to creators — advisors need to become creators.
Wealth managers need to find their own voice, and express it in compelling opinion pieces about market developments (rather than stale quarterly market updates). And they should share those opinions with the world using social media. Why not make videos for TikTok to educate young people about market events or trends, explaining why they are relevant to them, and how they and their families can navigate them? If what they create is interesting and relatable then they are planting the seeds for strong client relationships, now and in the future.
Dani Fava is Head of Strategic Development at Envestnet, Inc., which seeks to empower advisors and financial service providers with innovative technology, solutions, and intelligence to make financial wellness a reality for everyone.

The information, analysis and opinions expressed herein are for informational purposes only and do not necessarily reflect the views of Envestnet. These views reflect the judgment of the author as of the date of writing and are subject to change at any time without notice. Nothing contained in this piece is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Intended for investment professionals only. Past performance is not indicative of future results.

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