How to Match Customer Investment Strategies with Products

Blog Post
April 27, 2018

Saving for the future is smart. Yet, historically many Americans haven’t exactly been wired to do it. So, financial advisors have long relied on scare tactics to convince consumers to save for the future: 

  • If you’re not putting at least 15% a year in your retirement fund, you’ll be working until you’re 75!
  • Better start saving for college when your child is two years old or you’ll face more student loan debt than they’ll ever earn back! 
  • What if you faced a serious medical emergency? You could lose your house or business paying the medical bills!

Even if there is some truth behind each statement, the communication pendulum is shifting away from fear to focusing on the benefits of saving. 

Most economic indicators point to continued recovery from the 2008 financial crisis, and consumers seem to agree. In fact, a Mintel study from October 2017 shows that 79% of people in the U.S. consider their finances to be in a positive place. Those who are dissatisfied with their situation want to increase financial security by saving for emergencies and/or retirement. Consumers know that saving and investing is important—and they’re willing to research options. 

Here's the real challenge: the pool of potential investors now spans four very different generations with unique needs and goals for investing.

It’s all about me

If you’re not pairing strategies with the specific needs of potential investors, you’re missing out. While traditional investment models are still good predictors of behavior, they’re not the only tool financial advisors should use to frame their product sets and approaches with potential clients. Advisors—and the firms for which they work—must consider the why behind consumer behavior. 

Baby Boomers and Gen X

Take Baby Boomers and Gen Xers, for example. They are clearly at highest risk if they haven’t built a long enough runway for retirement. Yet, retirement plans aren’t the only offering that will pique their interest. Some may be looking for help to manage their aging parents’ portfolios. Business owners, ready to hand over the reins to their successors, now need an investment option to protect the hard-earned equity they’ve built. They value the guidance financial advisors offer, so long as those advisors recognize their individual needs and the investment jobs they’re trying to complete. 


Now to their children. Millennials are naturals with technology and multi-tasking. But, they want—and even expect—hand-holding through life’s big decisions. They’re more concerned about present funding than saving for the future and are highly stressed by debt, according to Mintel. Financial advisors can help alleviate that stress by walking them through proactive debt management tools and by serving as coaches for individual retirement planning. Tools must be mobile-friendly and ideally include some type of recognition for reaching their financial milestones along the way.


Generation Z, or the iGeneration (born in 1995 or later), is the newest group to enter the workforce and start thinking about investments. iGens want information on demand and trust the advice of friends—even strangers—more than authority figures, organizations and brands, according to Harvard Business Review. Like their older siblings, they value online connectedness; however, they want to do their own research and make their own decisions (to a point, that is). They expect nearly every interaction in life to be personalized and have little tolerance for brands who haven’t taken the time to get to know them. Additionally, one negative interaction with a firm can cause their natural online sharing reflex to kick in with a vengeance. 

So, what’s a financial advisor to do? The most successful ones recognize the uniqueness of each generation and engage with them on their terms, balancing investment education and coaching with industry expertise and authority. 

Think like an investor: goal, gap, go 

Of course, generational characteristics aren’t the only influencer of investment decisions. Financial advisors have long known that factors such as age, life stage, risk tolerance and investment ramp timeline played a large factor in the portfolio suggestions they make to clients. However, this traditional segmentation approach yields large groupings of customers matched with pre-defined investment portfolios and doesn’t necessarily consider the uniqueness of each buyer’s specific journey. 

Indeed, the more insight advisors have into the jobs consumers are trying to complete will allow them to better align their offerings at the start, increasing the likelihood consumers will pay attention.

To connect with potential investors, advisors need to think like them. Technology has created a do-it-yourself culture that has now transcended into the world of investing. The formula for connecting with these DIY’s is quite simple:  

  1. Goal – Consumers, especially younger generations, are goal oriented. They’ve painted a picture in their minds of the future they want and simply want to know how to get there. The goal might be retirement, but it also might be starting a business or paying for college. If you watch their online behavior close enough, they will reveal their goals, and you can start a more informed conversation with them.
  2. Gap – Got my goal. Now what’s my gap? The “Age of Me” consumers don’t care as much about industry statistics as they do what’s relevant to their lives. Blanketing them with information about what the average American needs for retirement means nothing. They want to know how much they need for retirement and the specific financial gap they need to close to get there. Use industry data behind the scenes to build online investment calculators, then hand clients the controls. The scenarios they build will give you valuable insights into their current financial health. 
  3. Go – With goal and gap in hand, consumers are ready to go take the journey toward finding solutions that promise financial security. They want investments they can monitor regularly and track progress toward their goals. But don’t assume they want to go on the journey alone. This step is typically where hand-holding by a financial advisor is most valued. They will feel confident walking into an investment conversation with their own research in-hand but will still rely on the expertise the advisor brings to the table. They won’t likely say “go” until they get validation from an expert. 

Where to start? 

There’s an adage that says if you want to know what a man values, look at his passbook. Where he spends his money tells you a lot about him. So, start with your marketing department to find out where the best customer data is and how to access it. I assure you, it’s being collected, and it’s just a matter of finding and using it. 

Data is plentiful, especially with tools like Global DataViewTM. Use it, along with propensity scoring, to determine your highest potential leads. Be sure the data on your customers is available and used across channels. This is where many investment firms fall short. If a firm knows how a customer is behaving online but fails to communicate that activity to the call center, marketing or field advisors, it’s a big miss. 

Let’s say a consumer is searching for 529 plans. However, the planned marketing calendar calls for an email about health savings plans to be sent. While there’s nothing wrong with educating customers on other topics, the firm still hasn’t recognized the immediate job at hand, which is saving for college. If that same firm continues to send irrelevant offers, the customer may grow tired and unsubscribe all together. 

However, if the firm is paying attention to the buyer’s actions and sends valuable information on college savings plans, the customer is more likely to react. A robo-advisor can serve up specific 529 plan options for consideration. Then, imagine that same person contacting the call center and an informed agent already sees that the caller has been investigating 529 plans. The agent can have relevant information readily available to continue the conversion. Now, that’s a productive way to match investment options to specific buyer needs!

Having data is essential; but making sure you leverage it across the entire buyer’s journey is the key to delivering targeted, timely and relevant conversations that ensure alignment with buyer needs. 

The environment has never been riper for financial advisors who know how to engage and encourage consumers (rather than scare them into saving) and to offer them solutions to build their investment confidence and help them reach their financial goals.