At a time when investors are rattled by Covid-19 and faced with historic market volatility, the last thing they need is to not be able to access their investment accounts.
But with extreme market swings and high volume, a number of wealth management firms in the past several weeks have experienced high-profile website service outages. And that has had a negative effect on customer loyalty and satisfaction, according to J.D. Power's 2020 U.S. Self-Directed Investor Satisfaction Study released on Thursday.
The survey revealed that Vanguard ranked highest in self-directed investor satisfaction among investors seeking guidance, and Charles Schwab ranked highest in self-directed investor satisfaction among do-it-yourself investors.
Website issues, the survey pointed out, have been frequent and damaging even before the coronavirus pandemic. In fact, self-directed investors indicated that website issues have been the biggest source of problems and are responsible for 33% of all reported issues in the past two years.
Among DIY investors, those who experienced at least one website outage during the past 12 months are twice as likely to say they either “definitely will” or “probably will” leave their current firm in the next year.
The survey found that when problems occur, 79% of self-directed investors turn to human support channels to solve the problem. Overall satisfaction among those who work with a human to solve a problem is 21 points higher (on a 1,000-point scale) than among those who use self-service digital channels.
Also, self-directed investors’ satisfaction scores are highest when a strong multi-channel experience is provided, the survey said. A combination of web, mobile and human interaction received a score of 809, while having no interaction scored 706 and mobile-only interaction with their firm scored 751.
As for satisfaction with their firms, Vanguard earned the top rank with a score of 820 out of 1,000 in self-directed investor satisfaction among investors seeking guidance, based on performance in the following eight areas: firm interaction, account information, commissions and fees, financial advisor, information resources, investment performance, product offerings and problem resolution. Charles Schwab was close behind with 819.
And Charles Schwab took the top spot with a score of 817 in self-directed investor satisfaction among DIY investors, based on these seven factors: firm interaction, account information, commissions and fees, product offerings, information resources, investment performance and problem resolution. That was followed by Vanguard with 800 points and Fidelity with 790 points.
The 2020 study is based on responses from 5,511 investors who make all their investment decisions without the counsel of a full-service dedicated financial advisor. The study was fielded from November 2019 through January 2020.
In its 18th year, the survey evaluates key satisfaction drivers and firm performance among both investors seeking guidance (those who don’t have a dedicated financial advisor but do have access to interaction with a registered investment professional) and true DIY investors (those who do not interact with professional advisors).