Advisers need to step up digital offering to keep HNW clients

Advisers who focus on high net worth (HNW) clients instead of less affluent socio-economic groups will find they have as a great of demand for digital advice offerings as the groups they avoid, according to Netwealth.

Speaking at the Money Management practice management webinar, Matt Heine, Netwealth joint managing director, said the use of technology for client engagement was the biggest area that an advice practice could have significant uplift.

“Clients expect a digital presence, they won’t accept an experience that’s not online and financial planning is now compared to every other service they’re using, whether that’s Netflix, Facebook or Instagram,” Heine said.

“We looked at the different segments from millennials, millennials with money, emerging affluent, all the way to through to the HNW.

“What we found was that HNWs have as big demand for digital experiences as the millennials.”

Netwealth data found that 83% of HNWs want access to performance reports on investments on their mobile.

“And yet, when you look at the number of advice firms that are providing that access, its 53.6%,” Heine said.

“There is a lot of activities that millennials, millennials with money, emerging affluent, and HNWs are actually wanting to access and engage with their adviser through a digital environment or online portal.

“The percentages of those that want it and the firms that are delivering it is significant, so there’s a big gap there and we look at that gap as the opportunity for firms to ‘wow’ their clients and deliver the advice in the way they want to.”

Research from Netwealth also found a year-on-year improvement of 60% in client engagement in communication, 28% that said they’ve improved the affordability of advice, 25% that said they had a greater ability to deal with the smaller balanced clients, and a 36% increase for those that used technology to grow client numbers.

“When tech is implemented correctly, it is incredibly powerful; what we’ve seen over the past 12 months is largely COVID-19 driven,” Heine said.