INDUSTRY NEWS

Edward Jones’ AI Play? Data Stockpile Includes 500K Weekly Client Interactions

Edward Jones is sitting on a huge trove of data thanks to the millions of interactions logged monthly between its 19,500 or so advisors and 8 million clients.

Edward Jones' advisors interact with 500,000 clients per week, according to Haas, adding that the firm is gaining valuable insights into the wants, needs, wishes and "walks of life" of its millions of customers. She said that the firm believes AI can harness those interactions to provide insights to advisors and their clients on topics such as why a model or analyst opinion has changed, tax-loss harvesting and market volatility.

Edward Jones is in the process of rolling out Envestnet's MoneyGuide and Salesforce, which Haas says will be key to analyzing client interactions. More than 5,500 of Edward Jones' roughly 15,300 branches are now using Salesforce, and the firm said it expects that rollout to be complete in the coming months.

Our Take:

“Every curse has a blessing and every blessing has a curse!” - Garth Brooks

The billions of AI data points that will be collected over the next year may very well help advisors predict client behavior, but it may also help St. Louis predict advisor behavior.

Imagine the power of analyzing the mouse clicks of the mass exodus of advisors leaving every month, and using that info to train AI algorithms to predict the next likely breakaway advisor that has yet to leave? Do breakaway advisors do similar things in the months leading up to their resignation as it relates to client interaction? Is there any change in the status quo of an advisor’s behavior before they leave?

Would it be possible using AI to predict which clients are less likely to follow their advisor to a new firm based on demographic or contact frequency, etc? Imagine after a year or so, the amount of data available when it comes to client retention analytics and if there’s anything they can do to keep clients from following their advisor.

Maybe clients who log in to their account portal more often when the market get volatile are less likely to follow their advisor? And maybe those clients should be called first by the “babysitting advisors”? When we help advisors transition, we are working to increase the client retention from an industry average 75% to 90%, but any edge the previous firm can get to reduce the assets flowing out would make hitting that 90% goal significantly harder and result in leaving behind revenue.

INVESTMENT NEWS

NFL owners open the door to private equity investment into teams

National Football League (NFL) team owners have voted in favor of allowing private equity funds to acquire up to a 10% stake in any given franchise.

NFL becomes the last major North American league to permit institutional investment. MLB, NHL, NBA, MLS have all previously voted to allow it.

Each fund is able to invest in up to six teams, and will have stakes capped at 10%.

Approved funds includes Arctos, Ares Management, Sixth Street and a consortium consisting of other PE firm.

Our Take:

Obviously investing in professional sports is not for everyone, but I do love that it’s possible for the right person. Investors are constantly looking for ways to diversify into something unique and special that they can tell their friends about and this might just be the *chef’s kiss” of unique and special.