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Client Portals - The Return on Investment

Whilst the FS industry is increasingly aware of the purpose of client portals, there is a difference of opinion on the benefits  portals  deliver. The general views across a small sample of high quality advice firms* were as follows:

There is great research coming out of the US highlighting the difference a client experience platform or portal can make to your bottom line. I have summarised the highlights from a recent white-paper ( source: SS&C Advent  ) below, it clearly shows how firms are achieving dramatically different results due to implementing  client experience technology .

Technology focused advisers (TFAs) are firms using a combination of CRM, portfolio management, performance reporting, financial planning, document management, portfolio rebalancing,  account aggregation  and  client portals .

Such firms are twice as likely to offer mobile access and are increasing their tech spending compared to other firms in the study. Because they base technology decisions on specific strategies rather than solely on cost, the TFAs identified in the study are enjoying strong financial performance.

  • They are seeing  higher revenue  per staff  (+19% ) and per professional  (+18%)  than other study participants.
  • They have considerably  more assets  per staff  (+13% ) and per professional  (+25% ) than other firms.
  • Driving that financial performance is much higher productivity serving clients, as TFAs can manage 41 households per staff versus 30 households for others, a 37% difference.
  • When measured per professional, the difference is even greater, with TFAs managing 113 relationships versus 69 for the study participants,  a massive 64% improvement .
  • Most importantly, they are seeing dramatic incremental  profitability  as profit per staff (+27%) and  per professional (+45%)  dwarfs the average profits for other participants.

Putting this in perspective, this means that technology use is adding 25 extra adviser hours for every 40-hour work week, or three full extra days per week.

What are TFAs doing differently to achieve these dramatic results?

  • creating new efficient ways to deliver the output of their advice on the devices most of us now use;
  • removing significant cost out of the back office function when producing valuation reports more frequently;
  • creating a digital proposition to defend against emerging online threats like robo advisers;
  • protecting the AUM as a client’s wealth starts to pass to the next generation. People inheriting wealth often change their adviser as they have a different expectation from advisers.

There are many areas where TFAs stand out but it is worth pointing out that  account aggregation  is major key differentiator. Some  89% of TFAs  are  using account aggregation  to automatically bring in data on clients’ holdings and include in their wealth management analysis and reporting, compared to 54% of others.

Shouldn't you be offering this to your clients? If you would like to learn more, check out some of our  client case studies  or  register for our next webinar .

Sim Sangha

Business Development Director