We are entering a new era of digital transformation. The integration of digital technology is resulting in fundamental changes in the business landscape—how they operate, their rate of margin growth and, most importantly, the level of customer engagement.

Increasing customer engagement is particularly relevant to financial advisor practices since research has shown that highly engaged customers are:

• Six times more likely to try a new product or service
• Four times more likely to refer a product or service to a friend or family member
• Two times more likely to pay more for a product or service than a less expensive alternative from a competitor¹

The idea of digital transformation may mean different things to different people, but consider the positively prosaic paper-based legacy approach of the account opening process.

One study conducted by CapGemini Consulting of the customer experience with paper-based processes within banks found that:²

• 50% of paperwork in account openings were rejected
• 60% of customer dissatisfaction originated in back-office processes
• 10-20% of contact center volumes are execution-related issues in the back office

A financial advisor can immediately see where the damage of “bad first impressions” and frustrated clients can lead to dissatisfied new clients and lost referrals.

Finding Opportunities for Digital Transformation

Unlike a bank or consumer product business, financial advisors can’t always drive digital transformation on their own. However, what they can do is make sure they leverage every opportunity available to them to implement digital integration. For instance:

• Advisors can guide clients toward digital options and away from a legacy approach that leaves the advisor or staff as the intermediary between a client request and service execution. For example, enroll clients in e-delivery; e-delivery allows important documents to be received more quickly and more reliably, cutting down on client dissatisfaction and service calls.
• The clients’ online experience can be improved. One example of this is American Portfolios Client Access, by which clients can seamlessly self-register to the platform, then simply and easily update their profile information, set mailing preferences and enable account security. Without the potential delay of going through a financial advisor, the client experience is improved.

Another way to enhance a client’s online experience is to upgrade the practice’s website with more relevant and timely text and video content, including upcoming events, community happenings, market commentary, etc.

Perhaps the most important thing an advisor can do in this evolving digital world is take inventory of all the available opportunities for digital transformation at their disposal and identify which best addresses client needs and improves overall client experience.

Sources:

1. https://www.superoffice.com/blog/digital-transformation/
2. https://www.i-scoop.eu/digital-transformation/digital-transformation-deep-dive-customer-experience/

Please reference disclosures: https://blog.americanportfolios.com/disclosures/