It’s a sad reality that at most financial planning conferences, many attendees go out of their way to avoid being in the exhibit hall, due to a combination of exhibitors that don’t feel relevant, poor salesmen, and especially the few bad apples that really make the experience uncomfortable. Yet financial planners actually should want to be in the exhibit hall – not only for the opportunity to find new vendors, service providers, and products for their businesses, but more importantly to do the requisite due diligence to ensure they are up to date on the latest products and services. In point of fact, doing such due diligence is arguably a key aspect of fulfilling one’s obligation as a fiduciary CFP certificant.
So how can the bad exhibit hall experience be fixed? The starting point is attracting a broader range of exhibitors than “just” insurance and investment companies, broker-dealers, and custodians, but also including software and technology companies, consultants, and more. From there, lay out the exhibit hall itself less like a random scattering of exhibitors and more like an efficient supermarket with aisles dedicated to certain types of companies, and wrap it up with an Ignite-style session built to allow a little bit of time for a lot of exhibitors to show what they have to offer.
In most cases, the primary problem with the poor exhibit hall experience is simply that the majority of vendors and service providers in the exhibit hall are the wrong exhibitors…and on top of that, many of the right exhibitors are nowhere to be seen.
There are a few fundamental problems that have led to this issue. The first is that the manner by which financial planners, especially the independent-minded fiduciary CFP certificant, choose products and companies to work with has changed. While a great deal of business was once driven by a close relationship between a wholesaler and the advisor, where the advisor would then recommend and deliver the wholesaler’s products to his/her clients, that is no longer the case. Instead, the conversation for many products – especially in the realm of investments and insurance – tends to start with “show me which of your products and solutions are best-in-class in their category.” The mentality is pretty straightforward: “If your products and services aren’t best-in-class, I won’t deliver them to my clients, so don’t waste my time.” Of course, not every company is going to be best-in-class, and there’s nothing wrong with a little variety, but filling an exhibit hall full of vendors and providers who are not best-in-class just makes the exhibit hall a wasteful experience for the advisor. The bottom line: it’s time for better screening of which exhibitors are allowed to participate.
The second problem–perhaps even more insidious–is that the roots of the exhibit hall are the insurance and investment products that advisors deliver to clients; products that are typically produced by huge companies with billions (or tens of billions or hundreds of billions) of assets, who can afford to spend huge amounts of money on exhibit halls, especially since it just takes a couple of advisors and their client dollars to produce a good ROI for exhibiting.
The reason this is a problem is that the pricing for the entire exhibit hall tends to be based on this type of product provider, while financial planners are served by a far wider range of companies, products, and services. For instance, most companies that provide software solutions specifically for financial planners – from MoneyGuidePro to Junxure – are so small they would be a rounding error on the market capitalization of a major custodian, broker-dealer, or investment firm; yet all of them pay the same cost for a booth, regardless of whether they’re trying to get $100 million of AUM from the advisor or just a $500 software subscription. Similarly, the solo practitioner independent consultant, and the totally new start-up technology firm, also all pay the same rate as the large firms and the mega firms, despite the fact that their revenue might only be measured by the thousands or tens of thousands of dollars (not millions or billions) – which means, in practice, they are completely priced out of the exhibit hall, and instead have an inefficient experience as a conference participant hoping to meet enough people to make it worthwhile, or simply go to a smaller niche conference instead.
So what needs to happen instead? Financial planning conferences need to develop an effective tiered pricing structure, with different pricing depending on either the type of company/business/service, and/or the size of the company.
There’s no reason a start-up firm should be paying the same rate as an established multi-billion dollar company; doing so simply ensures that financial planners will never be exposed to any innovative new companies. Similarly, there’s no reason that an independent consultant to financial planners should be paying the same rate as a broker-dealer with 2,000 advisors; doing so simply ensures that financial planners will never be exposed to specialists who can help them with their specific problems. Instead, independent consultants should have a different pricing structure of their own, which should be different than technology companies, which should be different than insurance/investment product providers, which should be different than broker-dealers and investment custodians. Additional tiers might be made, such as a separate “start-up” pricing structure for technology firms with less than $500k of revenue (or $100k, or $1M, or whatever number seems appropriate).