Advisers Report More Client Contact through Recession

Phoenix Marketing International surveyed financial advisers at various channels and found that advisers are generally more pessimistic than optimistic about the economic environment. Nearly one-in-four anticipate that the economic crisis will continue for five years, while one-in-five believe the crisis will be resolved this year. One-third of surveyed advisers strongly agree that American’s quality of life will be adversely affected for the long-term.

The majority (60%) of advisers indicated that they have had more contact than usual with their clients, which has helped with relationship-building. Phoenix said advisers might be one segment of the workforce that has been strengthened by the economic downturn, as strengthened relationships contribute to greater stickiness and opportunity for sales once the market turns around.

Product Changes

In response to the financial crisis, advisers reported that they have recommended different types of products to their clients (generally more conservative), as well as suggesting that they diversify across a broader range of providers, according to Phoenix Marketing International.

Advisers see opportunity in both insurance products and mutual funds. Respondents were most likely to strongly agree that term life insurance (45%), annuities, and stock mutual funds (43% each) are suitable products for recommendation in these times, followed by bond mutual funds (40%), and money market funds (38%).

Surveyed advisers looked at seven types of financial firms and rated local community banks and mutual fund companies as the most trusted (34% each). Garnering less trust in today’s economic environment were brokerage firms (18%), large national banks (16%), and credit card companies (10%).

The Phoenix study was conducted in May and June among 898 financial advisers who sell securities, retirement services, and/or insurance products.