PureFacts Blog

Advisors and Clients Travelling Together on the Digital Highway

May 17, 2018

All roads converge at the digital highway when it comes to investment advisors and their clients. That’s because baby boomers have embraced mobile technology in the past few years, while millennials have grown up with the digital experience and rely on it for everything from socializing to investing.

With the multi-trillion dollar wealth transfer that’s underway between these two demographic groups, this point shouldn’t be overlooked. Investment firms without robust digital strategies won’t pass the finish line.

There’s an incredible amount of innovation occurring in digital relationship software, and I’m sure it’ll only increase exponentially over time. The ingenuity of social media platforms is essentially spilling over into everything else, including wealth management. The Internet is the relationship autobahn and the race is on to overtake competitors at every turn.

“Investment advisors who rely solely on telephones and in-person service are quickly becoming as obsolete as history. Digitally-led hybrid advice, differentiated for client experiences, is upon us already,” says consulting firm Accenture, in Future of Wealth Management.

Advisor-client digital platforms are transforming wealth management business models. “The overriding principle is that financial institutions and their IT organizations must be prepared for a world where change is constant—and where digital comes first,” says PWC in Financial Services Technology 2020 and Beyond: Embracing Disruption.

Taking the right route on your digital roadmap

One of the biggest challenges I see for wealth managers is in developing digital strategies and roadmaps that will help them compete now, and ultimately win further down the road. That’s because the race is already on, and there are many routes to take. Further, the landscape is constantly changing so wealth management firms have to adjust their strategies on route.

So, how do wealth managers help their advisors win in the client relationship race?

One area of opportunity I’ve noticed is around dynamic digital interactions. This is a relatively new field of development. Typically, advisors and their clients don’t share a single portal, so they can’t interact online.

For example, a client may get an email notice at home, and then access an online performance report. The performance report may even have some dynamic elements, like a one-year return graph that changes when the client clicks on the since-inception return. Later the advisor may call the client to discuss the performance report. But, the client and advisor aren’t looking at the same report, but rather two identical versions and they can’t interact together. However, we’re beginning to see innovation where the advisor and client will be able to interact online with the same report.

Imagine an advisor and client looking at a 5-year performance graph. The advisor is in her office. The client is at home. The client asks, “I wonder how much my portfolio would have been worth if I had invested twice the amount I did each month?” The advisor then responds, “Let’s take a look.” The advisor then clicks on a “What-If” button on her desktop and changes the automatic monthly contribution of $300 to $500. The client watches this happen on his tablet. They then both simultaneously see the graph render with new dollar values. Now that would be a compelling story.

As Accenture sees it, “Digital has arrived and will only grow in prevalence, as it fuels agility and efficiency in wealth management practices. …Investors overwhelmingly value collaborative relationships enhanced by digital technology.”  At PureFacts, we couldn’t agree more.

Speak to us about how we can help you create a winning digital strategy. Contact us today.

  • Pat Sathiensamrit

    Director, Strategy

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