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Clara Shih, Digital Doctor: The 2017 IA 25

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Seen as the premier source of insights on all things digital in the advisor space, Clara Shih is CEO and a founder of Hearsay Systems, which lets advisors and their firms use social media, websites, email and text messaging in efficient and compliant ways.

A Starbucks director since 2011, Shih has worked for Google, Salesforce and Microsoft. In addition to creating the first business application on Facebook, the Stanford and Oxford graduate has written several books, the latest of which is “The Social Business Imperative: Adapting Your Business Model to the Always-Connected Customer.”

(Related: FINRA Issues Social Media Q&A)

“We are standing at the crossroads,” said Shih at a recent social media event for financial services professionals. “We can complain that [technology] gives us more to do, but there are also opportunities ahead. The point is to stay relevant as firms look at the next generations [and take steps] to ensure that robo-advisors don’t take over.”

How can advisors make themselves stand out in a crowded and increasingly automated field? They must be accessible online – aka “be Googleable,” she says.

Social media can help advisors both attract and retain clients. “Nearly 2 billion people are active on Facebook, and high-net-worth investors spend more time on social media than others,” she said. “The more wealth individuals have, the more time they spend on social media. There is a positive correlation.”

In addition, data can be an advisor’s best friend, according to Hearsay, which processes some 100 million interactions involving 150,000 advisors and others and sorts this information to predict the highest-risk items. Its latest rollout, for instance, is a compliance platform that uses machine learning to prioritize the highest-risk offenses for supervision teams to track.

Latest Lessons

Speaking in mid-May at the kickoff for the yearly Hearsay Summit in San Francisco, Shih explained: “The iPhone was unveiled almost exactly 10 years ago. It’s hard to remember pre-smartphone times.”  

“In the last decade, all of us … have witnessed the ultimate renaissance – not just in marketing but in all our relationships and aspects of our personal and professional lives,” the executive added.

With more than 90% of smartphone owners keeping these devices nearby at all times, “How we get everything done is completely different today [compared with 10 years ago],” she said. “We … do not want to wait for information or to fill out a form. We want a response instantly”

But despite the revolution in technology, many advisors and financial professionals market themselves “like it is 2007 or earlier,” Shih says.

Though there’s been tremendous innovation in fintech with the rise of the mobile platform in the past decade, she explains, many advisors are held back from exploiting these tech advances due to regulatory and other hurdles, such as legacy infrastructures.

“Thus, they are still calling to prospect or to get a bill paid,” Shih said. “Who picks up their phone?”

It’s time for businesses to aggressively embrace change, she argues: “How do we bring advisors along? They are trying to get with the times … but are caught in a tough place as clients text them. This communication, by text, is what the customer wants. [Advisors] need our help …”

Working in favor of advisors and their firms is a “unique, authentic voice, which is a very powerful asset for each and every organization” in financial services. “You are a people-oriented business with an advisor voice, and that is what consumers crave,” she added.

— Read Frontrunners: The 2017 IA 25 on ThinkAdvisor. 


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