Are advisors committing to digital tech? Clients weigh in

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“Before anything else: preparation.”

Alexander Graham Bell’s motto underlies a common business theme: Disasters are fundamentally a continuity challenge that must be met by innovative thinking and smart technology — and this pandemic has certainly upended the way wealth managers serve their clients and how those clients work and live.

Are you prepared?

With many extended families now sheltering in place, financial planners finally have an opportunity to implement and commit to a digital, interactive approach to conducting business — one that clients increasingly say they prefer. A recent Broadridge investor survey detailed how clients now want advisor information to be communicated via their favorite digital channels — a trend that’s even more pronounced among tech-savvy, younger cohorts.

For wealth managers and financial planners, the themes of advisor productivity, the financial education of families and the personalization of wealth experiences are converging in new and exciting ways.

In the survey of 1000 individuals who currently use a financial advisor conducted in June, 57% said communications with their advisor had changed in some way in light of stay-at-home mandates.

Of that number, 58%, cited phone calls and 46% cited emails as new ways that they communicated with their advisor during the pandemic. More than a third (36%) used video chat, even though only 9% prefer the method above all others. Importantly, millennial investors were most likely to use video chat with their advisor (59%), according to the survey.

Meanwhile, another Broadridge survey of 401 financial advisors across wire, regional, IBD and RIA channels, performed in July and August, found 65% say working from home has been just as effective as working from the office, and 86% have been able to host productive virtual meetings with clients.

Perhaps that’s why 58% of advisors still expect to work at least partially remotely a year from now while 27% still have no current plan to return to work or are unsure of their return-to-work plans, according to the survey.

Beyond backyards and boundaries

These survey results provide a clear indication that advisors should prioritize investments in webinars and virtual-meeting technologies to connect with current and future clients. As in-person meetings look to become a thing of the past, investments in such virtual tools also open the door for advisors to prospect and attract clients outside of their historical geographic regions.

Those professionals who grasp how emotional this moment of crisis is have a chance to play an important role in each client family’s financial life and to establish deeper relationships with the entire family.

But it remains an underutilized opportunity: Of the clients surveyed, 44% reported that their advisor had not communicated with their spouse, partner, children, grandchildren or heir.

To remedy this, financial planners should consider broadening their educational outreach to the entire family through Zoom and other technologies. Virtual seminars can bring everyone together to discuss concepts like investment risk and explore asset allocation solutions.

While boomer parents adjust to new communication technologies younger generations demand the same customer experience from their wealth manager as they receive from their favorite retailer. This includes reaching their advisors by mobile, email and text, online access to full, up-to-date account information, and personalized advice that addresses their broader life goals.

Meanwhile, the millennials in the family will become the richest generation in history as they inherit over $68 trillion from mom and dad. Seventy percent of this cohort has no advisory relationship and, in an ironic twist, the millennial search for advice is gearing up just as large numbers of financial advisors are set to retire over the next decade.

Striding generations

Our investor survey also detailed investors’ increasing expectations of personalized experiences, especially among younger generations.

Advisors should be particularly attuned to their clients’ communications preferences. Customizing each client’s experience begins with knowing what they are already doing online. If the market gets choppy, planners should know in advance how to contact each client the way they wish to be reached, whether by text, call, email or app.

Even a response to a simple social media posting can offer advisors personalized insight into their client’s digital engagement preferences. Artificial intelligence and analytics can further ensure that each client receives the right message — promptly.

To transform business to the next-gen model that clients want, financial planners will want to adopt the Artificial Intelligence (AI), blockchain, cloud and digital capabilities required for personalizing relationships successfully. If you can’t scale and implement your modernization efforts, another firm will.

In the months ahead, successful planning firms will keep their relationships with clients both personal and socially safe.

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