Digital communication is now at the center of many lives – but it’s not necessarily a tool all brokers and advisers have embraced. However, those who use digital tools may have huge opportunities to earn new clients and retain current ones.
“Ninety-six percent of households with incomes of $75,000 or more are online,” writes Michelle Jackson for Employee Benefit Adviser. Between 1 and 5 percent of wealth management and retirement advising firms use digital engagement tools, Jackson writes, which means a huge opportunity for those who embrace such technology.
It could especially help earn business from Millennials. This group, born between 1980 and the mid-1990s, are collaborative and eager to work with advisers. But they want to communicate in ways that are diverse and often digitally driven, writes Charles Paikert for Financial-Planning.com. “Interactions and plans should be customized.”
Jackson suggests providing a one-stop digital mailbox where clients, especially Millennials, can manage all their communications. “Millennials now account for more than half the workforce and most express an interest in using (such a tool),” she writes. “By providing a consolidated cloud-based portal that will put all these experiences in one place — including their retirement communications — creates a destination that can help to create a richer multi-channel experience.”
Some larger firms are moving into the area of virtual financial advice, Chris Flood writes for the Financial Times. “This virtual advice market can be seen as the industry’s response to the rapid growth of low-cost robo-advisers that offer automated services but no contact with a human adviser,” Flood writes. It also fills the needs of clients like Millennials, because it offers a high level of personal service but is delivered digitally.
But Millennials aren’t the only factor driving the digital trend. According to an Investment News editorial, which cited McKinsey & Co. “Surveys show that 20 percent to 30 percent of mass affluent and high-net-worth clients are already comfortable handling their finances at a distance.” Giving clients options for how they want to communicate benefits everyone.
Along with satisfying clients, virtual meetings can also make brokers and advisers more efficient because they cut down on travel time. They may also result in better client retention because a client who moves can still do business with the broker. “In the past, that client may have severed ties with his old adviser; in the future, a tech-savvy adviser may be able to hold onto those assets,” according to the editorial.
“If your firm doesn’t offer alternatives to face-to-face meetings, now is the time to draw up a game plan,” according to Investment News. “The goal should be to put your clients in the driver’s seat.”