The new face of client relationships in wealth management
Despite the front runners leading the way in wealthtech adoption, the wealth management industry as a whole sometimes struggles to shake the perception that it is resistant to change.
Indeed, some firms have been overly reliant on legacy processes historically resulting in a general adoption rate of new technologies that can lag behind other industries. Recent events have drastically disrupted the market though, catapulting advisers into a more digitised way of working. With face-to-face meetings not a possibility during lockdown, advisers adapted quickly and took to their screens to support their clients and develop new relationships. For firms who are approaching this shift as a springboard for further innovation rather than just a means to an end, it opens the door to new opportunities.
Most countries have experienced unprecedented surges in people interacting and transacting online. According to EE, there has been a fivefold increase in the number of Zoom users on their network compared to pre-lockdown, alongside a 45% increase in traffic for Microsoft Teams. Microsoft revealed that Teams has now surpassed over 75 million daily active users and 200 million daily meeting participants, stating a 70% increase in usage following lockdown regulations, whilst Zoom has revealed a record-breaking 300 million a day meeting participants.
The drive to digital isn’t just restricted to the wealth management sector: the adoption of video calls is across the board. People are embracing video calling in both their work and personal lives. Wealth managers are coming to terms that their clients’ behaviour is changing with the times, with new audiences open to now expecting it as default or as a preference.
The younger generation have always been more inclined to use digital channels for their financial services, but still expect those that have a personal touch. What we are now seeing though is a growing number of older generations adopting video calling platforms to conduct everything from family gatherings through to business meetings. With older generations more likely to be more vulnerable to COVID-19, firms can expect this trend towards video to last long after lockdown is eased.
Despite massive disruption to the sector, both advisers and clients are starting to see the benefits this technology offers them, whether it is improving efficiency or flexibility. With a dramatic economic shift, wealth managers have had no time to relax since lockdown. Stock markets have been volatile often going up and down dramatically over the course of a single day, meaning advisers have had to be in constant communication with their clients, either reassuring them or helping them take advantage of new opportunities.
The removal of travel due to video calls means wealth managers can free up more time each week to spend with their clients and strengthening relationships. Firms are also able to operate more efficiently enabling them to pass potential cost savings onto their clients. With access to advisers and the perception of value for money so important, this is boosting client loyalty, with the more forward-thinking organisations considering how video conferencing can be factored into their processes on a permanent basis.
Just the beginning
Whilst some providers like Wealthify were ahead of the game, with their pre-set being a digital-only provider, some more traditional firms embraced and adapted to the new era. For example, Chase de Vere has chosen to embrace the changes and even rebrand their strapline to ‘We’re here for you, by phone or video’ and they make video calls their primary point of contact. Progeny is another financial advisory company that is embracing digital interactions, through video calls, podcasts or informative content videos.
Current occurrences have demonstrated that the sector can quickly adapt to become more digitised in their operations and video is just the beginning. A recent survey conducted by the Financial Times revealed that the majority of wealth managers would now speed up the adoption of digital communications, highlighting the opportunity for real change in the industry and a whole new way of managing finance.
Wealth managers now have access to more tools than ever to digitise processes. Wealth management as a sector has always relied on the relationship between adviser and client, and the adoption of new technology is not set to detract from this – quite the opposite in fact. New tools are emerging which empower advisers to automate admin chores, optimise the client experience and put smart risk management safeguards in place. These all share a common and timeless ambition: putting the client first.
Advisers have been able to experience the benefits of digitisation first-hand through the move to video for meetings. Firms should not view this as a short-term solution, nor the extent to the value that digitisation brings. To remain competitive, firms will increasingly need to consider the wider ways they can improve client support through new technologies.
Face-to-face no longer implies meeting in person and advisers are able to provide a similar level of service, building and maintaining personal relationships with clients and truly understanding their complex needs through video interactions. These enforced changes are only accelerations on long-terms trends that were eventually going to happen. It seems that digitisation driven by the pandemic may be here to stay.