Digital experiences are driving advisors’ investments, according to J.D. Power’s newly released 2021 U.S. Advisor Online Experience Study, which found that BlackRock, Capital Group and J.P. Morgan rank highest among advisors who rate their online experience.
As importantly, some 93% of advisors said they plan to invest more money in the next three months with an asset management firm that ranked in the top 11% for digital experiences, according study.
“The point we are trying to make is most firms are not investing in advisors’ digital experiences, but when they do deliver, there is a huge opportunity,” Michael Foy, senior director of wealth and lending intelligence at J.D. Power, said in an interview.
“The return on investment of providing a meaningful digital experience is significant and is responsible for deepening asset management firms’ relationships with advisors, particularly in an environment where it is harder to differentiate on product and pricing and the wholesale model diminishes over time,” Foy added.
The study looked at 3,000 unique advisor evaluations of wholesalers’ websites and sought to measure how financial advisors interact with asset manager websites as part of their practice of helping clients build and manage optimal portfolios. The study found that advisors go beyond a firm’s track record and the relationship they have with the firm when choosing where to invest client money.
Many asset managers, however, including Charles Schwab and Vanguard, are missing the mark on basic ease of access of key information, website navigation and functionality, which creates a significant gap in satisfaction between top- and bottom-ranked firms, according to the study, which did not release individual scores or rankings.
"We’ve all become accustomed to being able to quickly find information online without having to pick up the phone or send an email for every question. That same experience extends to the advisor-asset manager relationship,” Foy said. “Advisors are significantly more likely to invest more with a firm that makes it easy for them to quickly find the information and tools they need. Some firms are delivering on that promise, while others are lagging far behind.”
According to the study, many asset managers still need to fix the basics. “Clear site navigation and ability to find the information and tools needed is a core requirement of asset manager websites, but just 37% of advisors say it is very easy to find the information they need and only 34% say it is very easy to find the features and tools they need on an asset manager’s website,” J.D. Power said.
To create that differentiated site experience, wholesalers need to create “unique thought leadership, guidance and advice on advisory practice management and new business development. When advisors are aware of these differentiated types of site content, satisfaction rises,” the company said.