Jed Finn, COO of Wealth Management, said that as customers use services that get them closer to perhaps benefiting from a relationship with an advisor, the system will prompt both client and advisor toward a meeting.
“For the referrals that go to advisors, there’s a revenue share that goes with that. Same thing that we have with internal partnerships where a corporate coverage advisor is sending leads out to a partner in the field,” he said. “It’s the exact same split, so there are no incentive differences.”
In addition, the way future and current clients interact with some of the investor tools will also turn up on an advisor’s dashboard to prompt discussion. For example, Finn said, the content library is an important part of the firm’s strategy. There, a consumer can access articles, podcasts and videos covering everything from handling equity awards to advanced planning strategies for nontraditional families. The record of that access is collected and thrown into the algorithm, and if the consumer has an advisor, it connects to the advisor-client dashboard, where it can be seen by both the advisor and the advisor’s manager.
“So there’s accountability,” he said. “If the engine comes back and says it thinks the client is interested in something, but nothing gets actioned, the manager can have a discussion with the FA that says, ‘We think something’s in the best interest in the client.’ So it gives us a management capability where we can prompt a discussion, and that might otherwise not be possible.”
Ever since CEO James Gorman joined Morgan Stanley from Merrill Lynch in 2006, growth of the wealth management business has been a priority, starting with the 2009 merger and integration of Smith Barney. At the time, that created the largest global wealth management platform with 16,000 advisors and $1.8 trillion in client assets under management.
Since then, it’s a mission that continues to pay off. Acquisitions such as Solium Capital (2019), E*trade Financial Corp. (2020) and Eaton Vance Corp. (2021) have brought Wealth Management assets under management to $4.9 trillion. And last year alone the firm attracted $438 billion in new assets.
“Mathematically, if you look at our net new assets relative to competitors, it’s much higher,” Saperstein said, speaking to the point that he believes Wealth Management’s investment has been a recruitment draw. “Our advisors and our teams are growing at a really rapid clip. And everything you see accrues to the advisor team, so these technologies and these capabilities are really helping our advisors and teams grow, and word gets around.”
Finn added that Morgan Stanley’s investment, quality of research and access to products, tools and technology for both clients and advisors has meant the Wealth Management business now represents a much larger percentage of the overall company than at any competitor.
“It’s night and day in terms of percentage,” he said. “There’s a huge focus here on supporting this business, and it comes from the leadership on down. And advisors recognize this because we’re able to launch things more quickly and get exclusives with third party partners.”