Casual person using tablet to analyse financial dashboard

With the exception of a few market leaders, the percentage of client wealth reporting delivered digitally (vs paper) is astonishingly low for 2019. Industry averages suggest that many wealth managers are hovering between 0% and 20% for digital delivery of statements, confirms and other client reporting. Comparing these stats with banking (retail is more than 90% digital) or other industries (digital utility billing exceeds 50%) suggests a big challenge and an even bigger opportunity for advisors.

Why is digital wealth reporting so low? There are a number of challenges facing our industry. Legacy back office systems and the requirement to aggregate data from multiple technologies has created a technical challenge for wealth managers. New industry players, including robo-advisors, have the advantage of delivering a better client reporting experience without wrestling with legacy technology. Business models can also be an obstacle; asset managers who are responsible for client name reporting often don’t have direct access to the investor to gain consent for switching to digital reporting. Finally, the most common digital reporting experience is an online PDF — and that is not very exciting.

Investors want an engaging online experience. A recent Consumer Digital Demands report by Charles Schwab found that 52% of consumers are more comfortable relying on technology to get answers to questions and solve problems. Digitalization offers the potential for increased transparency and advisor collaboration, as well as greater convenience. We also know that digitizing aspects of the advisor’s practice leads to greater success. A study from Fidelity found that advisors using a broad range of digital technologies have 42% higher assets under management (AUM) and earn 24% more than their peers.

How can we bridge this gap between low levels of digital wealth reporting and the opportunity to improve investor engagement and advisor success? We believe there are three key steps.

The first is the client experience. Look no further than leading robo-advisor platforms to see what best-practice digital reporting looks like. It is interactive, offers a long-term view of the investor’s account and is highly engaging. PDF copies of documents exist on the platform, but they are an afterthought – the exciting and engaging content is up front.

The second important consideration is making digital conversion frictionless. Many wealth managers have complex digital consent processes that result in low adoption and high levels of abandonment. One of our bank clients shared their experience of having more than 1 million clients visit and then abandon their digital consent platform (before converting!). The process of gaining consent for digital delivery was recently made easier with proposed amendments to the Bank Act in Bill C-86, which clarify that an investor can provide consent for digital delivery via electronic means.

The final — and most important — step is creating demand for digital adoption. Implementing a marketing campaign that delivers the “digital message” in every channel is essential to success. By applying these principles, our clients are seeing adoption levels of 50% or greater.

There are few digital transformation opportunities that deliver such a compelling business case. Diverting the cost of print and postage into a compelling client reporting experience will not only improve engagement and advisor success, it will also deliver significant savings to the dealer’s bottom line – a triple bottom-line opportunity not to be ignored.