Merrill Lynch Wealth Management announced details of its new consultant development training program on Monday. Perhaps the biggest change was the ban on cold calling, which applies to the entire herd of thunder.
“As a company and industry, we’ve gone way beyond cold calling,” said Andy Sieg, president of Merrill Lynch Wealth Management, on a call with reporters on Monday afternoon. “We won’t call any of our advisors. Cold calling is a very inefficient way to set up a practice today. Most of the seasoned financial advisors in our firm and across the industry came to this conclusion some time ago. “
The ban on cold calling was first reported by The Wall Street Journal and Bloomberg.
Instead, trainees are encouraged to build new customer relationships through LinkedIn, as well as leads and referrals from Bank of America. Sieg said there were wider opportunities for collaboration and referral to move from consumer banking to Merrill. The bank serves more than 60 million customers, more than 3 million of whom have net assets in excess of $ 1 million and have no investment relationships with the company.
Louis Diamond, president of Diamond Consultants, believes the cold calling ban was due to multiple layoffs of Merrill consultants who violated the company’s Do Not Call list. For example, the company fired financial advisors Ethan Kunin in Austin and Nicholas John Ferguson in New York in late 2020. In his BrokerCheck profile, Kunin said he was following the instructions he received in the training program in the summer of 2020.
“However, in classic Merrill form, they are making a blanket rule across the company with no exceptions or specific consultants who don’t break the rule of still doing their business the way they want to,” Diamond said. “It’s just an industry practice: trainees call and it’s like a rite of passage. So many consultants have built their business. It’s a badge of honor. “
According to Diamond, the changes will bring Merrill one step closer to becoming a bank-dominated company.
“When consultants build businesses out of bank transfers, those businesses are not very portable because any bank transfer does not come under the protection of the broker protocol,” he said, referring to the decades-old industry-wide agreement that enables brokers to switch and bring companies more easily limited customer data with. “Usually, bank transfers are more difficult for the bank. It’s just about creating another wave of trapped advisory force. “
Eliminating the ability to cold call could also make the program more difficult, argues Diamond.
“In this day and age it is important to have multiple means of communication with customers and prospects,” he said. “Having these guys fight with one hand behind their backs while other companies still allow cold calls is a challenge. It’s difficult to grow your business this way. “
However, Sieg argues that the new program will be more efficient and effective. The company is targeting an 80% completion rate compared to the current success rate and industry success rates, which are generally less than 30%, he said.
In addition to moving to cold calling, the program will also include a new trainee role as a Merrill Consultant, which includes a salary plus incentive and is open to colleagues across the company, including Consumer Banking, Global Banking and Market roles currently in Merrill operate. like customer employees and external candidates.
However, executives also expect this to provide a natural career path for the company’s financial solutions consultants working at Merrill Edge. These people already meet with 20-25 customers and talk to them about their financial needs. The difference is that the offering isn’t that broad and that it’s more specific to the Merrill Guided Investing platform, said Aron Levine, president of Preferred and Consumer Banking and Investments.
“This creates a tremendous amount of skills and customer experience that is the starting point for entering the final stages of the consultant development program so that they are way ahead of the game,” said Levine.
Merrill currently has 2,000 apprentices who are expected to graduate in the next 12 to 18 months. The new program will complete approximately 1,000 new consultants per year, but now the program will only last 18 months instead of a 36 month period.
Executives believe the reduced timeframe is not an issue as most trainees have extensive experience with clients prior to entering this role.
The hurdles remain the same. To graduate, trainees must have 25 households and $ 15 million client assets.
“In order for Bank of America and Merrill to continue to lead, we need to build a professional advisory group that is well equipped to serve current and future clients,” said Sieg. “We know that growing our advisory force can be achieved through an organic talent development strategy, taking advantage of the enormous workforce at all levels of Bank of America.”