What Can Financial Services Learn From A Fashion Influencer, Model, and Philanthropist?
At first blush, it might be hard to see the links between the financial services industry and an Italian-born model living in Philadelphia. With nearly three million followers across Instagram, Twitter, Facebook and YouTube, Simonetta Lein reigns supreme as one of the top five fashion influencers in the world.
But upon closer review, the approach that Lein takes to her business ventures, community philanthropy, and approach to technology could be learning moments for financial services firms grasping to address the evolution of the industry.
The evolution of financial services firms is critical because the investment landscape is fundamentally changing. The next generation of investors heavily uses technology to meet their financial needs, and financial services firms that rely on bricks and mortar will lose to technology-savvy firms that address the needs of a changing client base.
What investors care about has also changed. The growing number of female investors – women who have inherited money from their families or made it themselves – takes a more cautious, community-oriented approach to investing. This holds true for the next generation as well; if there is not a well-developed relationship with heirs and an understanding of their needs, they’ll move assets to a firm that they perceive to be more representative of their generation.
Here’s where Simonetta Lein comes in. By understanding how Lein operates, the financial services industry may learn steps to evolve and grow with changing demographics. Here are two operational pillars that drive Lein:
1. Technology & Social Media
Lein generates business opportunities through the savvy use of social media driven by technology. Though the financial services industry is heavily regulated, advisors and teams must connect with their customers and deliver value by leveraging technology and social media. Advisors that don’t embrace the messaging power of platforms like Facebook and LinkedIn are missing the chance to connect with potential clients, especially Millennials and Gen X.
Leveraging social channels also allows advisors and teams to deliver a consistent message at scale versus one-off phone calls or snail mail. By messaging the core values and approaches of your business on social, you can dedicate more time to personalized communications with potential clients or recruits.
While it may take years to develop a follower base like Lein’s, investment in building a social media presence provides an alternative sourcing strategy for new clients and, more importantly, connects advisors to a new class of investors that embrace technology and social networks.
The next generation of investors considers social justice and philanthropy to be a core value when investing. 77% of Millennials have made an impact investment, and 84% of Millennials are giving to charitable organizations. While financial services firms do a significant amount of corporate giving, they tend to keep that information internal and not share it with their clients.
However, Lein shows the benefits of publicly declaring your value of philanthropy. Through her organization, The Wish Wall, Lein collects “wishes” from around the world, encourages her online community to meet them, and chooses several wishes related to women’s rights, literacy, and other key issues to grant over the course of the year. She works to grant the most socially impactful wishes based on the concept of “paying it forward”. Financial advisors, teams, and firms can take a page out of Ms. Lein’s playbook to create a unique way to help individuals in their local communities.
With the inevitable transfer of wealth to younger generations on the horizon, financial services firms should consider how to connect with the next generation of investors on their terms, not with outdated methods. Data shows that the next generation investors actually do a better job saving and investing than their parents. The habit of saving and investing will end up generating significant value for financial services firms that embrace what is important to this new class of investors – technology, social media, and philanthropy.