Digital client engagement will be the norm for the next generation of financial planners: 2018 Planner Technology Report


Peker Recep

Leading research firm Investment Trends has released its 2018 Planner Technology Report, an in-depth study of Australian financial planners and their technology needs.

The report, now in its fifteenth year, is based on a survey of 804 financial planners concluded in May 2018. This year’s study highlights a number of important trends:

Digital client engagement will be the norm for the next generation of financial planners

Financial planners seek to strengthen their client relationships by expanding their digital engagement channels, according to the latest Investment Trends research.

Aside from the traditional face-to-face client review meetings and regular check-up over the phone, financial planners most often keep their clients engaged through email newsletters (55% say this) or online access to view their portfolio (35%). However, the vast majority of planners (88%) are keen to use a wider range of digital-based methods to interact, update and disseminate information to their clients.

“The younger generation of planners are driving the move to an interactive digital client experience, with many already conducting client meetings online,” said Recep Peker, Research Director at Investment Trends. “They expect tablet enabled client meetings and the use of interactive modelling tools during client meetings to become the norm.”

“Technological advancement is rapidly increasing consumer expectations, a so-called environment of technology inflation. Platform and software providers therefore cannot afford to rest on their laurels and must be ever cognisant of the evolving expectations of planners and their clients,” said Peker. “From seamless mobile and tablet functionality, to paperless client authorities, providers have to future proof their functionality and tools from both a design and a delivery perspective.”

Platforms and planning software providers must collaborate to meet planners’ top advice and technology needs

The burdens of compliance and technology gaps are weighing on planners’ businesses. The share reporting year-on-year growth in practice profitability has consistently declined over the last four years to reach the lowest level since FoFA was announced. Many planners continue to face the same challenges as five years ago: compliance burden (64% cite this, up from 60%), new client acquisition (41%, steady) and building business process efficiencies (40%, steady).

“Planners seek greater support from their technology partners as they continue to face tougher business conditions, but their expectations have not been fully met. We’ve once again observed declining industry wide satisfaction with platform and planning software providers,” said Peker. “This falling satisfaction has led to 94% of planners saying they would switch their current systems to access improved tools.”

While planners predominantly prefer to access improved tools through their planning software, many are willing to change the platforms they use to access functionality that traditionally sits on planning software, including RoAs (31% cite this), SoAs (27%) and modelling tools (26%).

“To lift planner satisfaction, greater integration is required between the various systems used to deliver and execute advice, and a deeper collaboration between platforms and planning software providers is an important step to achieving this goal,” added Peker.

Netwealth takes the lead in platform satisfaction, followed closely by CFS FirstChoice

Netwealth has taken a clear lead in overall planner satisfaction, with 64% of their primary users rating their overall satisfaction as ‘very good’. This is followed by CFS FirstChoice and HUB24, with 55% and 42% rating them as ‘very good’ overall, respectively.

The top five platforms by overall satisfaction are:

  1. Netwealth
  2. CFS FirstChoice
  3. HUB24
  4. MyNorth
  5. BT Panorama & Macquarie Wrap (joint 5th)

“Netwealth has successfully held top spot in overall satisfaction ratings for the sixth consecutive year, leading to healthy growth in planner relationships in recent years,” said Peker. “Netwealth, alongside Macquarie Wrap and Panorama, has seen the strongest growth in primary planner relationships in the last 12 months, while CFS FirstChoice has managed to extend its overall planner reach,” added Peker.

“Platforms must remain focused on strengthening planner relationships, as the primary platform of a planner captures 67% of their total platform FUA, on average,” explained Peker. “Selection drivers such as efficient admin and online functionality are now hygiene factors, but to truly differentiate, platforms must emphasise their service and support.”

AdviserLogic leads in planning software satisfaction for the third year running

Across the planning software industry, XPLAN maintains a dominant position with 55% of planners using it as their primary software, followed by COIN (12%), Midwinter (7%) and AdviserLogic (7%).

For the third successive year, AdviserLogic has secured first place in overall planner satisfaction with planning software. AdviserLogic also leads the industry across the majority of service elements measured, including value for money and producing scaled/simple financial plans, while XPLAN leads in satisfaction for producing financial plans for clients with complex requirements.

“AdviserLogic continues to set the bar by delivering material efficiency gains to their users. For instance, AdviserLogic users are quickest at producing scaled advice for new clients, and this is reflected in its industry leading satisfaction in this metric,” said Peker.

You must be logged in to post or view comments.