Ludovic Sevestre

Leading research firm Investment Trends releases its 21st edition of the Adviser Technology Needs Report, providing an in-depth review of how financial advisers are adapting to evolving technology trends and industry demands.

The report shows a strong demand for better technology integration as financial advisers consolidate their tech stacks, emphasising the need for user-friendly client portals and improved reporting for non-custodial assets. Large practices, especially those with five or more advisers, are more inclined to increase their tech budgets to achieve these benefits. Advisers estimate their annual average tech spend at $37,000 and plan to increase it by 6% to $39,000, while larger practices aim to boost their tech budget by 8% to $91,000 per annum.

“Advisers recognise the need for seamless integration across their technology platforms to enhance client experience and operational efficiency,” said Ludovic Sevestre, Associate Research Director at Investment Trends. “This integration is crucial for delivering accurate financial advice, allowing advisers to focus on client relationships and planning. For providers, the opportunity lies in developing systems that adapt to future advancements, driving growth and client satisfaction.”

The results show the adoption of artificial intelligence (AI) is on the rise, with 37% of advisers already using AI tools to improve practice efficiency. A further 43% of advisers express interest in integrating AI into their practices, contingent on support for implementation, security, and privacy concerns. Current users primarily use AI for editing (42%) and customer service (33%), with substantial interest in AI tools for reporting (34%), customer service (34%), modelling (33%), analytics (30%), and practice management (29%).

“AI is transforming the financial advisory landscape by automating routine tasks and providing deeper insights through data analytics,” noted Sevestre. “Advisers who embrace AI will be well-positioned to offer more efficient and personalised services to their clients, gaining a competitive edge. Providers that develop AI tools to enhance client interactions and strategic decision-making will lead the way in this evolving landscape.”

Cybersecurity remains a critical concern for financial advisers. Over one in five advisers (21%) rate security among the top three most important factors when choosing an investment platform, surpassing brand and education. The most common security measures

implemented include multi-factor authentication (MFA), anti-malware software, and strong passwords. Despite these measures, 36% of advisers rate their practice’s cyber-readiness as below 7 out of 10.

“Security is paramount in protecting client data and maintaining trust,” emphasised Sevestre. “Advisers are increasingly prioritising cybersecurity in their technology investments, recognising it as a cornerstone of their service offering. Providers who focus on robust security measures will safeguard client information and reinforce their reputation for reliability and trustworthiness, essential for long-term success in the financial advisory sector.”

Investment Trends’ 2024 report delivers deep insights that underscore the ongoing transformation in the financial advisory sector driven by technological advancements and heightened security awareness. As advisers continue to navigate these changes, industry regulators, leading banks, investment platforms, fund managers, and financial planning software providers need to be ready to take advantage of these opportunities.

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Member ratings of their super fund’s ‘service’ is on the rise, but they want more.

Leading research firm Investment Trends releases the 16^th edition of its 2024 Super Member Engagement Report. Providing an in-depth look at member attitudes, satisfaction and advocacy, including how they would like to engage with Australian super funds. This years’ edition highlights:

The latest report shows that member engagement levels remain high for those with super balances of $250k or more, indicating a clear inflection point for next level interactions with their super fund.

“Member engagement with their super fund continues to increase, as many more look to take matters into their own hands when it comes to retirement planning,” said Ludovic Sevestre, Associate Research Director at Investment Trends. “Our data also reveals that the more interactions non-retirees have had with their super fund over the past year, the more likely they are to start thinking about retirement.”

The member experience with their fund service is an area explored in particularly forensic detail in this year’s report. The report highlights login credentials (17%), fund withdrawals (13%) and queries with annual statements (11%) as the most common reasons why members contact their super fund, validating the digital-led service delivery approach considered by many super funds. Faster responses (29%), better technical knowledge on the website (25%), better technical knowledge on apps (24%) and professionalism were viewed as the factors vital to delighting members who contact the call centre.

Despite positive returns in FY23, overall member satisfaction and Net Promoter Scores (NPS) have continued to ease, although a few (non-DB) funds bucked this trend.

Super fund switching activity eased slightly (8% down from 9% last year), yet intentions to switch remain elevated (10% up from 9% last year), particularly among self-directed members aged 45-65. Key triggers for this group include job changes, lack of trust, and poor fund performance.

“The persistently high switching intentions among self-directed members highlight the opportunity for super funds to build trust early and demonstrate consistent performance over time. They can pro-actively combat churn and enhance member loyalty by taking heed of the feedback their members have provided through this survey, but also by actively monitoring member engagement across their various service channels,” concluded Sevestre.

Research Methodology

The Investment Trends 2024 Super Member Engagement Report provides a detailed analysis of the Australian superannuation industry, examining the sentiment, attitudes and needs of superannuation fund members.

Based on a survey of 10,866 respondents conducted from February to March 2024, the Report is the largest and most comprehensive independent study of Australian super fund members.

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