Reimagining client relationships

Reimagining client relationships

The COVID-19 pandemic has significantly impacted the way that we do business, and the international financial services sector is no exception. In a sector where relationships are vital, it is important that we hold on to the ones we have. Considering the economic impact of the pandemic, it is also imperative that we develop new business. One must be mindful that the pandemic did not stop the onslaught of regulatory requirements.

In July 2020, the Central Bank of The Bahamas released the results of a survey of international banks and trust companies in the Bahamas regarding the operational impact of COVID-19.1 The results were reassuring, as institutions were able to maintain effective operations amid the pandemic. The financial impacts were noted as ‘minimal’, highlighting the resilience of the sector and the fact that the majority of firms were able to activate business continuity plans, while others quickly implemented plans to ensure that client needs were met.

Maintaining client relationships

Advisors quickly realised that, in the current circumstances, they would have to lean on the equity that had been built up with clients over time, with communication being key. To maintain existing relationships, it was imperative that advisors consider:

  • taking advantage of videoconferencing to increase the frequency of meetings, so keeping clients close;
  • investing in technology such as client relationship management software;
  • using technology to analyse client data, assess needs and communicate in a personalised manner;
  • accepting that clients still want personal interaction and that, as an advisor, there is an expectation to convey care and concern for clients’ wellbeing; and
  • developing strategic communications plans to provide updates on matters that impact clients, such as regulation, while also conveying an awareness of what is going on with the client to maintain the required level of trust.

Attracting new business

Traditionally, advisors met with prospective clients, introducers and business partners face-to-face. This has, however, essentially ground to a halt due to pandemic-enforced social distancing, while the resulting economic fallout has seen more persons concerned about their financial wellbeing. Consequently, more people are in need of financial advice and guidance on estate planning. It is the delivery of these services that has been transformed. Although face-to-face meetings will return, it is likely that in-person networking will not be as fruitful as in the past. This means that advisors will need to find new ways to attract clients.

Planning ahead

Millennials are earning and inheriting more. These tech-savvy potential clients expect that technology will be infused into service delivery. Therefore, service providers must embrace digitisation and automation not simply as a stopgap in the COVID-19 environment, but as the way of the future.

As clients embrace technology, the client experience must be enhanced using secure platforms that allow for the giving of ‘virtual advice’. However, there is more to ‘virtual relationship building’ than hosting a meeting or conference. The communication must be strategic, focused on prevailing client needs and supported by digital onboarding options and consistent outreach to clients.

COVID-19 planning considerations

The global economic environment and prevailing geopolitical factors have created an opportune moment for clients to review their estate plans and financial strategies. Advisors in jurisdictions such as the Bahamas have been focused on the following matters:

  • creation of emergency funds;
  • refinancing options for clients;
  • preservation of wealth;
  • managing family dynamics;
  • maintaining philanthropic goals; and
  • gifting strategies.

The effects of the pandemic have meant that advisors must review client relationships and offer advice to guide clients through these challenging times. Income-generating assets must be secured and measures put in place to ensure sustainability over the long term. Obviously, wealth preservation is of paramount concern, with clients considering the impact of dispositions on the overall value of their portfolios. With enhanced tax administration and reform, now is the time to secure tax advice. The stress of the pandemic has strained family dynamics as well. Hence, family governance documents must be reviewed and updated.

Equally, unprecedented times create unique opportunities. It definitely is not business as usual, but it is certainly time for advisors to hold their clients close as they rethink existing planning structures and embrace the opportunities, even in the midst of crisis.