Competing on "Service"

According to Saturday's Journal, financial services firms are beginning to offer their clients actual financial service. Aside from a bevy of online calculators:

"Last year, Merrill Lynch & Co. Started offering customers with at least $50,000 invested with them two free portfolio reviews each year with one of its financial advisers. While the company offered portfolio reviews before 2005 they weren't always offered twice a year and in the same way. The current offering is a formalized commitment."

This is a big deal. Aside from the statement that "our people are our competitive advantage", competing on "service" is probably the most over used and least substantiated idea in business.
Anyone who has been involved in the financial services industry knows that financial services firms have been running away from their clients as fast as they can for the past six years or so. The typical routine is to derisively call some subset of accounts "small", and either send them to a call center, or even better, just refuse to talk to them.

Merrill re-establishing that at $50,000 clients can count on talking to a real live professional twice a year is a big thing and seriously raises the bar for other firms that have taken on accounts they don't want to service.

Timothy Burger
timothyb(at)timothyburger.com