Adviser sector facing lumpy income, uncertain times – and opportunities

New Zealand’s financial adviser industry has been able to showcase its value proposition to consumers in a way that it might previously have taken three to five years to achieve, adviser coach Tony Vidler says.

Tuesday, June 9th 2020, 6:52AM

Tony Vidler

He was one of four advisers who addressed a recent Financial Advice NZ webinar about their experience of the Covid-19 lockdown.

Vidler said things had been “incredibly busy”. In his own business and with those he worked with, there had been an effort to lift the communications level across all client bases, including a lot of personal one-to-one conversations.

He said there had been a deliberate decision to go looking for areas where more value could be delivered in new ways. “It has not been uncommon to have 12 or 14-hour days. The reaction we got from clients across the board from a number of businesses was generally incredibly positive … there was a lot of feedback from consumers who were thankful that advisers were reaching out, touching base, caring and showing interest. That strengthened a lot of relationships.”

There had been opportunities to broaden the service delivered which created cross-selling opportunities and chances for new conversations with existing clients, he said.

“Returns have been really good so far, and the return for advisers in future is even more positive. There has been a complete repositioning in many cases of adviser value and value proposition. That is gold. That is something that we’d hoped to achieve over three to five years but we’ve managed to accelerate that and bring it forward by three to five years. That’s a fabulous outcome.”

But he said things were still challenging for advisers and many were experiencing lumpy income. Many had revenue in the past three weeks that was equal to that of the last third of 2019, he said. “It’s incredibly lumpy – four or five weeks of nothing then four weeks of everything pouring through the front door. It is straining business systems, people and infrastructure. You do have to be cautious but you have to be a bit commercial too and think carefully about what opportunities you pursue and how do we allocate that capital.”

He said it was a “dangerous time” for advisers as they worked out how to manage their businesses over the next six months.

Another adviser, Tim Fairbrother said revenue had been lower as KiwiSaver and investment funds fell and new risk business was slow. But only one client had cancelled personal insurance and one client had withdrawn money. It was hard to get in front of people for new risk business, he said, and some people were hesitant to commit in an uncertain economic environment.

“We have targets in terms of how many people we need to see … going into the crisis we were sitting at 115% in terms of who we need to see and that’s fallen to 80%.”

He said his team had focused on proactively communicating with clients, which was an approach that served it well when it launched during the GFC.

“It’s all about activity … we are going to get out there and talk to as many people as we can. That’s our plan from here.”

Tags: Financial Advice New Zealand Tim Fairbrother Tony Vidler