Financial Planning

Tech stacks not meeting adviser needs

Technology stacks

More financial planners are relying on their technology stacks in order to engage with clients, but many believe their tech needs are not being met.

More financial planners are leaning on digital-based tools to meet their client needs as a result of the COVID-19 shutdown, but many feel they are not receiving the level of technological support they require, new analysis from research firm Investment Trends has revealed.

According to Investment Trends’ “2020 Planner Technology Report”, as many as 82 per cent of financial planners believe the platforms and advice software they use to engage with clients are essential to their success, with more planners relying on their technology stacks to communicate with clients during the coronavirus pandemic.

“Since the start of the lockdown in early March, planners have significantly expanded their use of online meetings, email campaigns, digital signature tools and social media management systems,” Investment Trends research director Recep Peker said.

“Whether by choice or circumstance, planners are adapting their technology stack during these unprecedented times.”

Despite the increased reliance on software, the report revealed a third of the 693 financial planners surveyed in May did not believe their platforms and planning software helped them demonstrate value to clients. In addition, 38 per cent of those surveyed did not believe the platforms and software they are using helped improve efficiency.

“Planners trust their technology providers to help them improve the quality of their advice delivery and providers can do more to satisfy their high expectations,” Peker noted.

“A key first step is improving the online client-facing capabilities available to planners and their clients. For instance, planners currently give just 40 per cent of their total client base access to an online portal, but they want to expand this capability to more clients, with 44 per cent preferring all their clients to have online portal access.”

The research also showed a rise in the number of financial planners switching their investment platforms, with 29 per cent of planners saying they had switched platforms in the past year.

“Platform relationships are being challenged by the twin headwinds of the royal commission and the global [coronavirus] pandemic,” Peker noted.

“Not only has platform switching reached a post-GFC (global financial crisis) high, planners are also broadening the range of platforms they use. The average planner uses 2.6 platforms each, reversing the consolidation seen in the last two years (up from 2.3 in 2018 and 2.1 in 2019).”

The survey revealed Netwealth was the highest-rated platform in terms of overall satisfaction by primary users, followed by Hub24. Adviser Logic was the highest-rated primary advice software in terms of overall satisfaction.

“Despite macro headwinds, industry-wide overall satisfaction with both investment platforms and advice software providers increased for the first time since 2014,” Peker said.

“While great news for the industry, many satisfaction gaps persist in both parts of the value chain. To stand out, providers need to identify and refine the service areas that matter most to their users.”

Last year, analysis from Investment Trends revealed financial planners were losing faith in the domestic stock market and increasingly outsourcing the investment selection process for clients.

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