Guest Blogger: The Importance of Web Portals for Wealth Management

Guest Commentary by Darrin Courtney, CFP®, Research Director, CEB TowerGroup.

Bio: Darrin Courtney is a Research Director at TowerGroup covering important topics in Wealth Management. His research focuses on how technology supports the distribution and servicing of investment products, including the advisor desktop, financial planning tools, customer relationship management, portfolio management, retirement income, and client reporting. Darrin has more than 20 years of financial services experience in operations, client service, sales, product management, and business development roles in wealth management. He joins TowerGroup from The Hartford Financial Services Group, where he was a director in their Innovation Studio, focusing on the Wealth Management division. His previous experience focused on the support, creation, and distribution of Retail, Education, Retirement, and Financial Planning products and services, including both Qualified and Non-Qualified Retirement Plans. Prior to joining The Hartford, Darrin held positions at well-known investment companies such as Scudder, Stevens & Clark, Columbia Asset Management, MFS, and AARP Financial Inc.

Historically, the wealth management side of the financial services industry didn’t focus too much on web portal technology.  The assumption was that it wasn’t a feature their clients desired, nor did they want to offer solutions that could disrupt the relationship between advisor and client.  Most firms figured that the tailored, hands on, advisory relationship was the value proposition and that their clients where not the DIY crowd, which is why they hired an advisor in the first place.  The market crash of 2008, the continued instability in the global markets and the rapid evolution of technology has changed the attitudes of many wealth management clients however, and they now demand a far more collaborative relationship from both their advisors and the firms that employ them.

Forward thinking firms are enhancing their client facing portal and actively working to build out the features and functionalities that their clients desire.  Contrary to long held assumptions, CEB research has found that high-net-worth clients are quite comfortable using internet technology, and in most cases, prefer it to other channels.  This is not to say the human touch does not remain an imperative, as many interactions, such as the delivery of financial planning or problem resolution, face-to-face meetings and live telephone conversations are still the preferred method of advice delivery.  The client/advisor relationship is still critical, and that relationship remains an important part of the overall experience of the client with their wealth management firm.  That being said, CEB has found that the majority of clients with over 1 million dollars in investible assets, 71%, chose “online or the firm’s website” as the preferred method of accessing accounts, products or services.  Surprisingly, many  well-known wealth management firms and divisions have yet to add account access and other services, such as reporting or trading, to their client facing portals.

Contrary to the push back their employers feared, many advisors are requesting enhanced client web portals and more than seven out of ten found that the portals “save time, help the sales process and even improve advice quality”.  The largest benefit however, chosen by 39% of the more than 700 surveyed advisors, was “improve service quality”.  When clients are capable of quickly accomplishing simple tasks, such as viewing balances or printing a report, they no longer need to involve their advisor, or become frustrated if the advisor cannot move these requests to the top of their to-do lists.  By providing an effective portal, wealth management firms not only delight clients by giving them the access they desire, they also free up valuable time in an advisor’s day so they can concentrate on more important tasks, such as prospecting for new clients, or enhancing relationships with existing ones.  An added benefit is that the more clients use the firm’s web site, the more likely they are to remain with the firm.  In fact, recent CEB research found that clients who visited a firm’s web site at least once a week (56%), were far more likely to stay with a wealth management firm than those who never visited  (40%), if their advisor were to leave the firm.   Wealth management firms that wish to attract and retain clients in the years ahead will partner with technology vendors who are capable of providing the solutions that clients desire and advisors wish to support.

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