Client Engagement Platform and CRMs: Why Advisors Need Both

The modern advisor’s tech stack has to do almost everything to maintain a competitive advantage. Outside of human expertise and market interpretation, firms have digitized the sales process, client support, billing, marketing, market research, and file storage.

Yet, none of these specifically handle client engagement – key criteria when evaluating client retention and satisfaction. This measure used to be monitored solely with client relationship management (CRM) software or through analyzing the client support numbers. However, as the client experience became more complex, organizations required more specific tools to execute a client engagement strategy.

Client engagement platforms have emerged to fill the gap – even though the distinction between it and a CRM may not be clear at first glance.

Client Engagement Platform vs. CRM, What’s the Difference? 

The digital CRM has been around since the late 1980s, but it’s only over the course of the last decade that its role has begun to shift. Modern CRM platforms are robust and often include additional features for marketing and sales.

One of the most significant schisms is the difference between CRMs and client engagement platforms. In the past, your CRM acted as a virtual rolodex and a record of communication. Now, most client relationship management systems also emphasize sales or marketing over client satisfaction.

A CRM is essentially a client database. Depending on your specific platform, you may have any number of features or integrations, including:

• Client cards and contact information
• Lead status
• Invoices
• Billing status
• Social media management
• Email newsletters

A client engagement platform, on the other hand, is linked more closely to managing client satisfaction and personalization.

Why Use a Client Engagement Platform?

There’s often overlap between a client engagement platform and a CRM, but they aren’t quite the same. There are several reasons that an advisory firm would add client engagement software to their tech stack:

Enhance Client Personalization

According to one report, 72% of Americans will only engage with messaging if it’s personalized. In an industry that handles something as vital as someone’s life savings, creating custom and relevant messages is even more important. Your clients want to feel that you are speaking to their specific needs.

A client engagement software enables advisors to scale and track tailor-made communications. This ensures that you maintain a quality client experience while growing your business.

Monitor Client Satisfaction

The best way to retain clients is to keep them happy, but it isn’t so simple in the wealth management world. Clients become fearful in bearish markets and aggressive during better times. Therefore, advisors must always balance client sentiment with long-term portfolio success to help others.

A client engagement tool designed for advisors and fiduciaries may include specific features to get feedback from clients and make it easier to be proactive with client communication.

Analyze Client Feedback and Activity

Another key component is using client data and feedback to create a better client experience. A brief survey can help you pinpoint a client’s current concerns about the market or advisory approach. You can then better address their worries. Furthermore, you could use their risk number and data visualization features to set expectations and simplify your explanations for investment options.

Pull Data from Other Tools

A client engagement platform works best when it works in conjunction with other advisory software. In addition to working with a CRM, client engagement tools also work well with custodians, document storage solutions, and research databases.

Automate Client Engagement

The right client engagement software may offer automation support to reduce your workload further. For example, you can automate regular check-ins to gauge client sentiment or generate stress tests.

Why Use a CRM?

A CRM platform is often the central system that combines all of your software (if they are compatible). Solutions such as AdvisorEngine, RedTail, and Salesforce are often base software for any firm and other software built on top of it.

Consolidate Client Contacts

The first use of a CRM is to have a centralized client database. This makes it easier to track client communications with specific advisors.

Keep Track of Leads

Another fundamental element of a CRM platform is keeping track of leads. As a result, it often acts as a sales engagement platform. Your sales team or an individual advisor can set a status for each potential client, schedule follow-up calls, and save lead information in case they return.

Manage Marketing Communications

Many CRMs also offer marketing features or integrate with marketing tools. Common features are for email marketing or scheduling social media posts. Having a centralized location for marketing efforts makes it easier to keep track of advertising campaigns and monitor progress.

Seamless Collaboration

As a CRM includes information on clients, advisors, or other relevant individuals, you can easily collaborate with your team or external service providers – whether for sales or marketing.

Review Advisor Performance

Finally, a CRM platform’s enhanced analytics ensure you can track how many prospects convert into clients and how many clients stay with the firm. This enables you to track your own performance or junior advisors when attracting and retaining clients. Because you also have access to client communications, you can help your junior advisors pinpoint areas for improvement and provide specific feedback.

Design a Support Workflow

While you can be proactive and tap into client sentiment, it also helps to have an organized process for incoming questions. These may come from potential prospects wanting to book a discovery appointment and learn more about your firm or clients with specific questions about their portfolios. A CRM platform enables you to better help both groups without adding to your workload.

Integrations: The Best of Both Worlds

You will most likely want to combine your CRM platform with your client engagement tools. Integrating them provides your advisors with all the information they need to improve client success and provide better client support.

Jumpstart Your Client Engagement 

Using a CRM and client engagement platform in tandem is one of the best ways to supercharge your client experience. Each offers its own benefits and ensures all your systems work together towards growth. But without a clear strategy, it’s challenging to optimize any of your engagement tools or processes.

To learn more about setting up your firm for growth, check out our 101 guide to client engagement strategies.