Despite the finance industry investing billions of dollars in digital and technological upgrades to give wealth management advisors a leg up with their clients, adoption levels are low, leaving advisory firms unsure of what to do next, a recent survey by the Money Management Institute (MMI) and Aon found.
Around a third of advisors prefer to use third-party tools over the tools their firms provide, and less than half of clients said they were very satisfied with their advisor’s digital tools, the survey said.
“This must be frustrating for firms when they’ve invested so much money in building these tech platforms to make their advisors more efficient and more effective,” said Peter Keuls, Aon’s global head of wealth management. “Their advisors are still going out in large numbers to use third-party tools.”
One reason, Keuls said, is that most firms developed their technology incrementally, building on a base that might be two decades old and adding more functionality and capabilities over time.
“But what happens then is you have a system with a number of built-on pieces that don’t necessarily talk to each other,” he said. “The classic example is the CRM [customer relationship management] system that doesn’t communicate well with the financial planning system, so the advisor has to re-input the client information from the CRM system into the financial planning tool to produce a report.”
Frustration with those walls often compel advisors to look for a platform that’s better integrated, has better functionality or an ability to customize that the firm’s software doesn’t have, the survey found.
The solution, however, is not to throw more money at flashier features but to simplify the core features that advisors and clients want to use regularly.
“The firms are spending more than they can afford to spend, especially if you put a rate of return on their spending versus adoption,” said Craig Pfeiffer, president and CEO of MMI. “We talk about clients, we talk about advisors—I have to continue to remind people they’re citizens. And our citizens want easy things. Everybody in my neighborhood wants easier things, wants shorter content, wants more precise content, wants lazy use of graphics and numbers.”
Clients are used to being able to book airline tickets, manage their bank accounts, engage with brands, order a car service or groceries, conduct business and touch friends socially, all in a matter of seconds or minutes. “When they get over to financial services, it shouldn’t be so hard,” Pfeiffer said.
Advisors can improve how their digital offerings resonate with their clients by talking with them about their preferences and recording them in whatever CRM system the advisor uses, he said.