Is your advice business at risk of missing the technology wave?

Today, the advice industry remains stuck at the beginning stage of their digital journey. Legacy technology systems and traditional ‘human powered’ customer service is proving more difficult for the advice sector to transition to a technology focused customer service model.

According to a global PWC report ‘Why wealth management can’t afford to miss the digital wave’, 69% of high-net worth individuals (HNWIs) use online and mobile banking, with over 40% use online means to review their portfolio or investment markets.

Based on the study, digital and mobile services are now expected, and are as common in HNWIs’ lives as cars and phones. Advice firms that do not acknowledge this are putting their business at risk.

So what does a digital wave mean from a wealth management perspective and what changes, big or small, can you make to adjust to this digital wave?

Interestingly in the study, they also interviewed advice relationship managers who insisted that their clients did not want digital functionality. This is directly contradicting what their clients are saying.

So what does a digital wave mean from a wealth management perspective and what changes, big or small, can you make to adjust to this digital wave?

On the most simplistic level it means your website, investment updates and reports all need to be available via a mobile (or responsive) website. This means that clients can review their investments on the go, giving them a better customer experience. Also, making your adviser available via video or live chat for your clients and having other digital communication channels accessible will make your services stickier. You should also consider your social media footprint, I’m not suggesting setting up multiple accounts and employing a social media guru, but thinking strategically about your social media footprint and targeting one platform to reach new and existing clients i.e. Facebook, LinkedIn, Twitter or YouTube.

A more medium level of technology application would be developing customer dashboards allowing clients to analyse their monthly investment performance in detail. Rather than the monthly paper statement, what about a video statement? UniSuper, who were winner of Chant West Superfund 2016, have been doing video statements since 2014. Could this technology be transferred to clients in the financial services space?

An advanced technology focus would be clients being able to self-service real time updates to investments for the clients, giving them a live and interactive experience. Dependant on how little or how much control they want on their investments you can tailor this to your client’s needs.

A fun way to add digital elements to your client’s service offering is by adding some gamification. A financial goal based video game or calculators that provide some interactive entertainment to your client’s wealth management needs. A clever way to potentially empathy map your client’s wealth needs. This will also target a younger audience.

At the extreme end of technology development (which by some is not that far away) is using artificial intelligence technology that scans all research and news data and sends appropriate investment snippets of information to your clients. Think of it like Twitter for your clients.

From a technology perspective, to understand where you’re going you must first understand your current state

From a technology perspective, to understand where you’re going you must first understand your current state. Review each wave below and see which one your business predominantly sits within.
First wave: Digital Commerce. You can complete basic transactions online for your clients such as:

  • You email clients reports, commentary or e-news updates
  • You chat to clients via non-traditional methods i.e. Skype, personal messaging
  • You have a responsive or mobile website
  • You have a social media footprint and ongoing strategy to communicate with new & exiting clients
  • Your clients can log into a dashboard and see the latest report of their investments

Second wave: Digital Consumption. Your clients can engage online and make limited changes for example:

  • You have wealth management ‘games’ or calculators on your website
  • Your clients can log in and change their risk profile and investment mix in ‘real time’
  • You offer an electronic statement for your clients
  • You offer your clients real-time recommendations based on the customer’s behaviours/spend

Third wave: Digital Identity. Complete and real-time transactions online with the option of limited touchpoints with human interactions. Such as:

  • Can you provide your clients with a 360 degree ‘real time’ view of their personal balance sheet?
  • Interact with a ‘AI robot’ to help them make informed investment decisions

The question to advice firms is, are you comfortable with where your business is at in its digital journey?