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(L-R): David Armstrong, Bob Oros, Mike LaMena, Heather Fortner

RIA CEOs: Client Experience and Capabilities to Shape the Next 10 Years

Advisors can no longer differentiate themselves solely on being a fiduciary or managing a portfolio.

Registered investment advisors have had the wind at their backs over the past decade plus; in fact, despite the pandemic, the RIA channel recently reported a record number of advisory firms and assets under management per advisor. But CEOs at some of the most intentionally growing RIAs say the next 10 years will look a lot different. As much as the channel has grown, advisors need to do more to differentiate themselves in the marketplace.

“Just standing for fiduciary is no longer differentiating,” said Bob Oros, CEO of Hightower, speaking at the recent Industry Awards CEO panel. “Just to stand up and say, ‘I’m a fiduciary’ and think that’s going to draw any uniqueness—not there. The next 10 years becomes a lot more around the experience you deliver and the breadth and depth of the types of solutions and services you can bring.”

Oros says Hightower has its advisors focused more on “moments that matter,” meaning significant moments in a client’s life, such as a health crisis. It may not always be financially related.

“As advisor businesses, you’re going to have to get comfortable going to areas that seem pretty far from the bull's-eye, and those firms that do will be well positioned for the next five to 10 years or more,” he said. “Those that still think it’s about portfolios and rebalancing once a quarter risk irrelevance.”

Some of those capabilities that Hightower may look to add in the future include senior services and things addressing health care and mental health.

“I think there’s an arms race to add more capabilities, services, talent to be able to differentiate yourself,” said Mike LaMena, CEO of Wealthspire Advisors, speaking on the same CEO panel.

That may mean affiliating with a larger firm that has the resources and capital to make the investments necessary to differentiate, LaMena said. But those firms need to make sure they have the capabilities and training in place to help those advisors serve clients beyond their financial life.

“If you’re going to position your advisors as the trusted person in that individual’s life, the families that you’re fortunate enough to work with, you’re going to get calls that go well beyond financial, and you need to be in a position to respond,” he said.

“The firm, the enterprise itself, is going to be responsible for ensuring that those capabilities are available because the reality is that practitioners and technicians are not normally going to be educated and have to have people, human psychology-type conversations and do them well in an educated fashion,” said Heather Fortner, CEO of SignatureFD. “If that’s really what the consumer’s going to be looking for, how do you, as an organization, ensure that you have the resources available to those advisors to do this well?”

Photo by Diana BrittonSignatureFD CEO Heather Fortner

SignatureFD CEO Heather Fortner

The client experience is another area where RIAs can differentiate themselves going forward, with the CEOs arguing that advisors need to do a better job delivering a personalized client experience, similar to what they get in the other areas of their lives.

“Our industry is one of the only to get away with ‘it’s the client’s experience the advisor’s way,’” Oros said. “Our industry has been able to get away with not delivering that level of personalization that you get anywhere else, and I think it’s going to come to an end.”

“Clients should be a lot more empowered than they are today.”

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