In the past, digitization often meant simply creating a mobile-friendly website and a basic portal or dashboard for clients to view their portfolio from their phones. But with the Covid-19 pandemic rapidly accelerating digital transformation, the retail investor clients served by wealth management firms are demanding much more than just that—and firms that don’t align with these expectations could be setting themselves up for failure.
While product offerings previously occupied a more front and center role in what retail investors focused on, the majority of clients today are saying that “experience,” rather than product offerings are the differentiating factor in evaluating their satisfaction—or lack thereof—with wealth management firms.
This means wealth management firms need to do more than simply piece together different tools and applications to create a form of digitization. Instead, it’s all about fully integrated platforms that create a seamless digital experience from start to finish.
But the success rate of firms in delivering a truly digitized service experience has been highly variable so far, to say the least. And one of the most important reasons why could be that firms and their advisors aren’t asking themselves the right questions in the first place.
Building A Digital Experience—Where To Begin?
To be clear, it is undoubtedly challenging for financial advisors and their firms who are new to the process to think through how to get started in creating a digital experience for clients.
Too often, conversations begin and end with a “throw everything plus the kitchen sink” into the mix, with planning and results that lack focus and don’t solve for actual issues.
Instead, firms and advisors should rely on the following key questions to guide the initial diligence discussions on how to build the foundations of a more cohesive and future-ready digital strategy:
1. First, assess: where are our client interactions digital, versus traditional, in the form of paperwork or in-person processes?
The reality is that each firm and its advisors are operating at a different level of digitization by this point. It is relatively rare to encounter firms and advisors that remain all paperwork and in-person, but equally rare for firms to be predominantly digital right now. So the first vital step is to take inventory by determining what the firm is doing that is already digitized, versus what hasn’t been digitized yet. This may sound like a simple step, but the results generally contain at least a few surprises for the leadership teams of firms and their financial advisors.
2. What do clients currently say about our products, services and overall experience—in what areas are we seeing meaningful satisfaction and dissatisfaction?
It’s mission critical that firms and advisors avoid throwing the baby out with the bathwater when re-architecting their digital experience foundations. That’s why it’s important to also begin by carefully surveying clients and advisors extensively to see what is working and what isn’t. When it comes to meaningful quantitative data in this regard, there is one key metric that tells a truer story than others: customer retention rates.
3. Are there any points in our service process where people just get stuck?
It’s common to refer to an “end-to-end digital service journey,” and for good reason. Each firm should have a clear sense of the current path that financial advisors and their end clients take, from initial account onboarding throughout the rest of the advisor and client business life cycle. The vast majority of firms that are just starting to rethink how they digitize their service experience will find, upon initial review, that there are a few areas of that process where advisors and clients of all types continually run into slowdowns or roadblocks. Adjusting processes or tools to remove these impediments should be an immediate area of focus, and could yield oversized and immediate benefits.