Financial advisors accustomed to personalized interactions with companies outside of the asset management industry say they want those customized experiences from asset managers, but find few are providing them, according to a new report from kasina.
To differentiate their brands, Julia Binder, director of e-business research at kasina, suggests mutual fund and ETF providers should embrace the opportunities digital technology provides to capture the interest of advisors where they are online - on financial news and research sites - and link them back to their websites.
With more advisors visiting asset manager sites for information they cannot find elsewhere, such as detailed product information and expert commentary, providers continue to play an essential role in shaping their messages and should focus on anticipating and responding to advisors' needs, the report suggests. The report surveyed nearly 500 U.S. financial advisors representing 97 firms. Binder says that the personal relationships that helped asset managers build relationships and retain assets even during volatile markets must be extended online. She speaks with Monday Management Executive on the key takeaways from the survey and best practices for providers.
Q: Nearly 60% of advisors say the digital capabilities of asset managers affect their perception of the brands. Where is there room for mutual fund providers to embrace digital?
Using digital tools like websites, social media, content marketing and mobile access, asset managers have more opportunities than ever to build awareness with unknown advisors, gain consideration for their products and make it easy to do business.
As we've seen in our studies on social media integration and website engagement, a number of firms have developed initiatives in each of these areas. The key lies in seamlessly integrating digital engagement into the overall business strategy, underpinned by integrated systems for customer relationship management, content management, sales transactions, marketing data and online analytics. A number of clients are focused on upgrading and integrating these systems to allow them to better target advisors who will be most receptive to their brand messages and to tailor the customer journey to each advisor's individual preferences and behavior. But most firms are not yet able to deliver the personalized user experiences that the majority of advisors want and have elsewhere on the web.
Q: One in two advisors want firms to personalize online content to their needs - fewer than in past years because there has been no increase in the number of firms offering it. Why is this so important now?
Developments in technology adopted by businesses across the web have heightened everyone's expectations for customizable, personalized user experiences. Whether we are reading news, researching products, booking travel, or following a favorite performer or sports team, many sites greet us with information that is relevant to our interests, based on the search terms we use, our location and our history on the site. Asset managers need to adopt these technologies to develop the same insights and connections online that previously were confined to wholesalers in in-person meetings, or risk being overlooked by the vast majority of advisors that prefers doing business online.
Q: Three of four advisors want asset managers to let them choose the topics, managers, and products included in subscription emails, but only 43.1% of firms offer subscription at all. What is the disconnect here? What's driving that?
With the enormous amount of information that advisors receive from asset managers every day via email, it is not surprising that advisors want to control what type and topic of information that is sent to them. Most firms currently do not offer email subscriptions at all. Of those that do, the majority only have the option to register to receive email, without requesting information about their interests and delivery preferences. Advisors that sign up for email typically receive a weekly or monthly newsletter which probably includes some information that is not relevant to their interests and purchasing history.
This approach is easier for asset managers, but harder for advisors, who have to comb through, looking for any items of interest.
Q: What is your assessment of the relationship between fund providers and financial advisors in the current environment?
The reason the majority of advisors primarily research asset managers on financial news and research sites is because those sites - for example, Bloomberg, Yahoo!Finance, Wall Street Journal and Morningstar - provide the tools to filter and analyze the universe of products, the timely and useful information on investment strategies and planning, as well as the functionality to personalize and customize the user experience.
Asset managers that find ways to be present on those sites and then provide comparably tailored user experiences of the unique content they can offer on their own websites as well as engagement on social networks will nurture the long-lasting stable relationships that are the foundation of any successful business.
Q: What are the biggest drivers of change for providers? Do you feel advisors are in the driver's seat in this relationship? Why?
The use of technology is a critical differentiator in today's market-to identify advisors who are likely prospects for your brand, to connect with them in the way they prefer and use digital signals along the way to build insights and form sustained and profitable relationships.
With so many similar-seeming products to choose from, advisors certainly have the advantage and are likely to gravitate to brands that not only have the products they want but also make it easy to do business in the way they want. Sophisticated digital capabilities are an essential component of the relationship between the brand and the advisor.
Asset managers cannot afford to relax on developing and integrating digital capabilities, because firms need to be where the majority of advisors are - online - giving them what they want, in the way that they want it. And that's why advisors are "in the driver's seat."