PARTING SHOT

Advisors can learn a lot by balancing technology with a human connection.

N THE FINANCIAL ADVISORY INDUSTRY, WE HEAR A LOT ABOUT

“ digital transformation.” Technology, we’ re told, is revolutionizing the ways financial services engages with customers and making us more efficient practitioners. Increasingly, clicks are counted as handshakes.

Retirement planners and wealth managers have embraced technology to engage with and efficiently service clients. There’ s been an explosive growth in fintech tools— such as online retirement plan check-ins— and the industry has often answered client needs with the response“ There’ s an app for that.”

It’ s not the wrong approach, but it may be incomplete. Because an important question emerges: Are we confusing efficiency with engagement? Is effectiveness necessarily the same as emotionally connecting with clients?

Shopping For Insights At Trader Joe’ s

While high-tech capabilities are undeniably critical in today’ s business operations, no industry should lose the power of human connection— what we might call“ high touch.”

To gain insight, it’ s often helpful for us to look at other industries, which helps us pause, reconsider and check the dominant assumptions everyone seems to be running toward.

Take the specialty grocery store chain Trader Joe’ s, an exceptional success in its industry. The company is known for its cashiers’ interactions with customers, and you’ ll note that it isn’ t running as fast as its rivals into digital interactions( such as self-checkout stations). Trader Joe’ s does indeed use sophisticated technology behind the scenes— to power its supply chains and run its operations. But when it comes to dealing with customers, it remains committed to the human touch.

The company has achieved remarkable success with this deliberate strategy. A private company, it enjoys an estimated $ 16.5 billion in revenue, and various analysts have put its sales per square foot at a whopping $ 1,750 to $ 2,100, which would be four times that of Walmart’ s or Target’ s numbers. It also has an exceptionally loyal customer base.

Even more interesting is that Trader Joe’ s shoppers are not anti-tech Luddites. Its average customer is urban, college educated and between the ages of 25 and 44— precisely the demographic that most businesses are

Are we confusing efficiency with engagement? Is effectiveness necessarily the same as emotionally connecting with clients?

trying to reach through digital channels.

In a recent interview with Supermarket News, the company’ s vice president of marketing, Tara Miller, explained the rationale of avoiding retail media technology.

“ Everything you put into [ a store ] comes with a cost,” she was quoted as saying.“ We prefer to allocate those costs to developing products and hiring people to work at the store.”

While the chain’ s competitors are embracing digital advertising and platforms and having screens recommend products, Trader Joe’ s is deliberately steering away from screens, self-checkout, grocery delivery, curbside pickup, online shopping, loyalty programs and discounts. Instead, it’ s investing in people. The company’ s reasoning is that grocery shopping should be a social experience, and Trader Joe’ s crew members are enhancing it. Miller noted the role of these employees:“ They’ ll not only help you find what you’ re looking for and discover new products, but they’ re also happy to share their thoughts on those products.” continued on page 58

60 | FINANCIAL ADVISOR MAGAZINE | MAY 2025 WWW. FA-MAG. COM