Ready or not, advisors must answer clients' new digital expectations

COVID-19-driven techshift opens doors for broader household engagement and more personalized and secure messaging

Ready or not, advisors must answer clients' new digital expectations

The COVID-19-induced transition to remote work has led to unexpected benefits for the financial-services industry, leading to some calls for certain temporary shifts to be made permanent. And it’s not just financial firms and professionals that are calling for these changes.

In a recent survey of advised investors across North America conducted by Broadridge Financial Solutions, 62% of those who have experienced more digital modes of advisor communication due to the pandemic said they would entirely or partially maintain those changes even after the crisis passes. That tendency toward permanent adoption showed across all channels, including emails, social media, and video chat, among others.

A high-tech, high-touch approach
“The key thing is that clients are craving for personalized content, communications, and actions from their advisors,” said Michael Alexander, president of Broadridge Wealth Management. “That means firms that can deliver a high-tech and high-touch model in a personal and holistic, intuitive way – and Broadridge does this on behalf of advisors across different continents – are going to be the big winners.”

According to Alexander, Broadridge’s core strategy with respect to technology consists of an ABCD framework of transformation and innovation: A for artificial intelligence; B for blockchain; C for cloud; and D for digital. And in the course of the outbreak, the fourth pillar has clearly come to the fore.

While the study doesn’t dive too deep into specifics, it’s clear that firms are moving away from print and mail facilities, and migrating to and leveraging more digital communications. One significant finding emerged with respect to video: around one-third of the surveyed investors said they had that capability, but just 10% said they prefer it.

“Millennials and younger respondents showed a much higher propensity and willingness to use videos,” Alexander said, noting that video can be a powerful bond-building tool for advisors hoping to woo the younger crowd. “On top of that, they showed a great deal of willingness to be digitally transparent to advisors, including having advisors following them on social media and getting advisor communications through those channels.”

Based on Broadridge’s research, 70% of millennial investors do not have an advisor. In addition, 44% of people who stand to inherit money from an advisor’s primary clients – including the client’s spouse, children, and grandchildren – indicated that they have not been contacted by the advisor at all.

“When client money transitions, if an advisor hasn't already cultivated a relationship with their heirs, they're really going to be at a disadvantage,” Alexander said. “With people mostly locked in their houses right now,advisors have a captive audience. The chance to get people’s attention during the pandemic is a golden opportunity to deepen and broaden the relationships with the entire household, not just the single investor.”

Taking aim with technology
For the ill-equipped advisor, living up to clients’ heightened expectations might feel like trying to hit multiple moving targets at once. Aside from making sure that the messages they send are relevant and timely, they have to consider clients’ preferred modes of communication. Fortunately, Alexander said, great strides made in areas like artificial intelligence and analytics has made things much easier.

“In the old days, you had to take note and keep track of things manually, which opens trap doors through human error,” he said. “What’s really come to bear is that because of advances in data science, firms can have the ability to monitor client behaviours, and deliver communications in the right way and with the right timing.”

Advances in technology have also made securing client communications a much simpler affair. In the highly regulated wealth space, the ability to keep an archive or audit trail has become table stakes, with different tools across digital mediums now carrying that function.

Other compliance hurdles have likewise become much easier to clear.“We’ve always been very cognizant of privacy and regulatory laws,” said Donna Bristow, head of Wealth Product at Broadridge Financial Solutions. “In building next best action tools and other solutions for advisors, we’re very conscious of differences between countries to ensure that advisors can use our products effectively.”

The tools available today also add acrucial layer of security by letting advisors filter communications based on clients’ preferences before they are released. Social listening is another potentially valuable piece of the advisor’s digital arsenal, allowing them to monitor clients’ activity online and send a warning in case they post anything sensitive orsomehow otherwise risk their financial safety.

“It’s actually a really fun time to be in wealth because of these technologies, and the ability to integrate information across technologies,” Bristow said.“The more data you can leverage through the science, the easier it is to create personalized results the advisor can share with their clients.”

The power of technology isn’t lost on industry professionals. Broadridge’s statistics has found that advisors are keen to learn how they can use digital capabilities not just from a security and risk standpoint, but also to help investors grow their wealth. Alexander also noted that compared to before the COVID-19 pandemic, the level of interest in the firm’s digital seminars on using wealth technology solutions safely has tripled or quadrupled.

“Investors aren’t going to be one-dimensional. When they’re on a beach, they want information on mobile. When they're sitting at home, they might want it on their iPads. They might want it on emails, or they might want to actually go into the client UI,” he said. “The key is to be multi-dimensional, and allow clients to have it their way when they want it, with relevant information that's very intuitive to read and use.”


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