How to modernize client engagement

Q1: Studies show the investment management industry is lagging behind other sectors when it comes to digital innovation in client communications. Why do you think this is the case, and how do we overcome it?

I think it’s a broad generalization to say that the industry as a whole is falling behind. There are companies at different stages of maturity both in financial services generally and within asset management.

However, there are three trends that lead to a lack of digital adoption. The first is that asset managers have a culture of risk aversion and striving to never make mistakes. This is a pretty high bar to set, which can sometimes hinder innovation. When it comes to digital transformation, taking that leap can actually help avoid mistakes by removing inconsistencies and improving governance.   

Secondly, asset management firms have been very focused on getting results and letting those results speak for themselves as a key driver for business. But creating significant differentiation on performance has become harder and, as a result, client experience is becoming a much bigger part of the value proposition.

Despite this, companies are missing the insight needed to improve their services. Many rely on surveys and anecdotal feedback from client-facing teams and product managers who meet with customers. This means there is a lack of measurable, actionable data that is clear and helps them understand what their clients truly want.

Firms need to take a look at what their clients are doing to be able to offer them the answers to the questions they haven’t asked yet and talk about the next opportunities. Asset managers are coming to the realization that digitalizing client communications can put this data into the palm of their hands.

Lastly, clients have not been pushing back and clearly stating, “I don’t want to have to call you to get my reports.” Our recent survey with Aite found that 69 percent of respondents state lack of explicit demand from customers as the biggest inhibitor for digitalization. But the truth is, customers want to self-serve at a touch of a button and expect easy and modern solutions to access their data – they just don’t see the need to ask for this when it’s commonplace elsewhere in their lives.

Taken together, these three issues are the greatest obstacles for faster adoption of digital innovation in asset management.

Q2: How can digital portals move beyond pure distribution of information to provide a deeper understanding of clients’ needs, deliver a more compelling customer experience and drive retention while creating upselling opportunities?

There’s a basic, three-word answer: client engagement analytics.

If you're empowered with measurable insights on how your customers are engaging with content and reports, then you can really focus in on what is important to them.

That means you can dedicate all your resources to delivering what customers truly want - whether that's analytics or other new features. You then learn from the data and can see if your clients are responding in the way that you expected.

In turn, this enables you to try new things and innovate to see if you can increase that engagement over time.

Digital client engagement can also reveal opportunities that were hidden before, to either the end client or the asset manager. The beauty of it is that the more the client engages, the better the manager will be able to match data and products to their needs.

By delivering more meaningful interactions, firms appear more trustworthy and relevant to their clients, inspiring loyalty and increased investment.

It’s also a great opportunity to try new things and find out how customers react to different ways of displaying data, consuming content and styles of commentary, for example. Firms can play around with how they deliver information to find the most effective medium, with the ability to swiftly pivot to alternative displays, without negative impact.

Every firm can have the same data, but the way they tell the story can offer a distinctly compelling experience and push them ahead of their peers.

Basically, measure to see what's driving engagement and then do more of that. At the same time, find out where clients aren’t engaging and spend less of your time focused on those areas.

Taking this approach will allow you to really build engagement and offer a differentiated experience from your competitors.

Q3: What are the key considerations when building the business case for adopting digital portals?

It’s a multi-step process, but first and foremost, you need a very clear idea of who you’re trying to please and what you’re trying to accomplish. This means having a vision of what success looks like and using that as your guiding principle.

Secondly, you must make sure that you include your key stakeholders up front and make them part of the team. They’ll not only surprise you with how much they can contribute, but also advocate with their peers and other key stakeholders. The most successful roll-outs we’ve seen tend to include operations and client facing staff such as sales, client management, marketing, and product teams.

Next, find clients who are willing to partner with you to develop and be early adopters of the service. They will help you build enthusiasm and support for the product with your other clients, and give fundamental feedback about what they’re experiencing. If you can make them valuable references, then they’ll help get other clients comfortable and on the bandwagon.

Lastly, set clear and achievable milestones. What’s most important is to notice when something isn’t quite working as well as you hoped. Step up and acknowledge it as soon as possible, and then review things together as a team. Look for what can be learned from the project so far and how best to improve. Because that's what innovation really looks like. It brings the team together, it creates a supportive, creative and constructive environment, and that will lead to a successful project.