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June 04, 2015 at 12:00 AM
The perennial discussion over fees shouldn’t actually focus on fees at all. It’s not the fees that are the problem. The real problem (and the challenge for advisors) is communicating the value associated with those fees.
Most advisors provide value beyond the assets-under-management fee structure. But many advisors present their fees in relationship to this structure. This limits your value to the investment process you provide — a challenge with the proliferation of new, low-cost investment options.
If you’ve ever been asked questions like these below, it may be time to rethink the fee discussion:
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“What am I paying these fees for?”
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“How do your services compare to [XYZ robo-advisor]?”
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Several firms have changed the way they present how they get paid. We call it a “core” story. It is not the standard elevator pitch or value proposition, but an in-depth description of what you get paid for. It’s your value conversation.
If segmented, your value conversation can be presented clearly, concisely and in a way that will be understood and remembered by your prospect. Think of segmenting your value into three distinct categories, each with an associated fee.
