As someone who travels for a living, I am seeing firsthand the early stages of destruction that the coronavirus wrecking ball is having on the wealth management industry. So much so, that it may permanently change how business gets done in the future.
Why is that? For starters, wealth management has been, and always will be, a relationship business. Particularly when it comes to other people’s money, advisors want and need to do business with the individuals and companies they know and trust; and the best way to build that trust is in person.
Accordingly, there has been a bull market for the last 30-plus years in the conference, meeting and event circuit that seasonally peaks in the spring and fall every year.
Seems like just about every association, asset manager, custodian, broker-dealer, technology platform, trade publication and the like has at least one, two, three or more in-person conferences a year, fueled by an ever-growing ecosystem that supports advisors, who are anxious to get in front of these influential decision makers.
At the same time, advisors love to go to conferences to learn more about how to improve their businesses, stay on top of trends and (most of all) network with peers, industry experts and executives from companies they rely on to deliver advice to their clients.
We know this to be true, because alternative venues like online and virtual conferences, despite their lower costs and no-travel convenience, have never taken hold in the wealth space. In-person events are “in” — expanding and thriving in sync with the growth and success of independent advisors.
Times Are a Changin’
What happens when a true black-swan event, such as the coronavirus, invades the lucrative conference industry? The early answer, so far, is for organizers to start to postpone and even cancel events due to the increasingly dominant news of the highly contagious pathogen’s dangers and, of course, the related stay-at-home orders.
The list of cancellations keeps growing and is going deeper into the year.
Barron’s wisely canceled its highly popular Top Independent Advisor Summit, originally scheduled for mid-March. One advisor set to attend the Barron’s event wasn’t overly concerned about the challenges of flying to the event and being around a crowd of people, but worried more about the risk of “being stuck in Louisville, because there is an outbreak that locks people down temporarily.”
Other conferences affected by COVID-19 include Morningstar’s annual meeting in Chicago (postponed) and BNY Mellon Pershing’s INSITE (cancelled) — both set to take place in June in Chicago. [Editor’s note: McCormick Place, where these conferences were to be held, is being used as a spillover triage center for coronavirus cases.]
Add to this thinking an extremely volatile market, and it’s no wonder advisors are nervous about being out of the office. However, not all advisors feel this way. For instance, a female advisor in Texas was not terribly worried about these issues, as her firm has a strong focus on educating clients not to panic over short-term market swings, and historically these types of virus spreads are not unusual.
She did attend an executive retreat in early March in Florida, despite the growing concerns. “That event is too good to miss,” she said, adding that she hopes conference organizers will have the confidence to continue with their events, once the all clear is given.
Conferences, events and in-person meetings are critical to the continued growth and vibrancy of the wealth management space. Here’s to hoping that we just need to take a collective time-out for a couple months and that the craziness will blow over, so we can all get back to conferencing as usual. I, for one, will be there.
Timothy D. Welsh, CFP, is president, CEO and founder of Nexus Strategy, LLC, a leading consulting firm to the wealth management industry and can be reached at [email protected] or on Twitter @NexusStrategy.