Finding new clients, attracting and keeping them requires a range of qualities, and intelligent use of technology can play a big part in building successful wealth management businesses. We talk to InvestCloud's Christine Ciriani.

Wealth advisors can scale up their business, unify systems and improve client acquisition and retention rates by adopting better technology, the CEO of InvestCloud EMEA, Christine Ciriani, has told this news service.

Away from the immediate gyrations of financial markets and political dramas, the wealth sector faces massive intergenerational wealth transfer –possibly up to $70 trillion in the US alone. Advisors can be kept awake at night wondering whether they’ll retain only a modest share of this as newer, younger players try to win their business.

Ciriani, knows how big the challenge for wealth managers is. And she reckons that a cloud-native and unified platform is what firms need to handle the task. 

Over the next three to five years, Ciriani, speaking to this news service in Geneva, said wealth managers have three main areas of focus: enabling advisors to deliver personalised advice at scale; improving client-advisor collaboration and digital engagement; and supporting sales enablement and effectiveness. 

Where the “rubber hits the road” with all this talk of technology, clouds and “scale” is whether advisors find more clients and get better at keeping the ones they bring in. And Ciriani argued that InvestCloud’s performance shows that it delivers results.

“A large wealth manager in the US reported a client retention rate increase of 97 per cent and grew total account volume by more than 14 per cent over the past three years,” she told this publication. “Another large US wealth manager reported an increase in total account volume of 40 per cent over the past three years. A global bank offering wealth solutions reported that out of their clients who used the Education App (45 per cent) in Asia, those who did were seven times more likely to have purchased investment products from the bank.”

The tasks
In discussing the three main tasks that InvestCloud has, Ciriani explained the first one – “enabling advisors to deliver digital advice at scale.” 

“This is really about taking a data-driven approach to opening up access to advice for lower wealth segments, while still servicing the more high-touch needs of high net worth clients in a timely, personalised manner,” she said.

In the second task – "improving  client-advisor collaboration and digital engagement" – she said InvestCloud is seeing more demand for this every month on both sides as the advisor-client relationship is increasingly online. In-person interaction is still key for complex advice, but what clients consider “basic servicing” has evolved and therefore clients expect to be able to access information online, 24/7 and with self-service,” she said.

The third of the big tasks – "supporting sales enablement and effectiveness” – relates to helping to streamline relationship management end-to-end through digital means and using data more effectively from prospecting and onboarding to CRM and ongoing client lifecycle management (CLM).

“This is not just about achieving greater efficiencies to save advisor time but is also about driving client growth and retention,” she said. Solutions which re-use data across the lifecycle not only ensure data capture and maintenance is high quality, but it also ensures data which is captured through self-service client portals are used effectively as data is captured once and only once. It also allows customer success officers to support bankers, driving further scale.

Swivel-chair effect
Advisors often face a mass of different systems, and these need to be folded into a simpler, more unified approach. 

“A major problem that still exists is the dreaded ‘swivel-chair effect’, where advisors must swivel amongst five, six or sometimes even upwards of 10 systems to service their client. This is not only a huge headache for advisors but really diminishes their ability to service clients holistically in the way that’s possible with a truly cloud-native and unified platform,” Ciriani said. “Onboarding in private banking is also still a major pain point, taking one or sometimes three months. Wealth management is also fundamentally about expectation management, and this roadblock takes away from being able to deliver the white-gloved experience clients expect from the get-go. Adding in a greater degree of automation through both machine learning and digitalisation can help standardise and streamline processes and deliver an all-around better client experience.”

This publication put it to Ciriani that client expectations have been affected by developments in other sectors (hotel and tourism, travel, luxury goods, etc.). 

“We help wealth managers to deploy some of the tactics of the biggest internet media companies to create brand entanglement with their customers. We talk about the power of the YouTube effect: just like the share button on YouTube for viewers, advisors can leverage digital referrals to exponentially drive client growth,” she said.

“Allowing clients to quickly share relevant content and other aspects of their wealth management experience amongst those in their network can serve as really powerful social proof for a firm,” she said.

“We also build client portals with a recommendation engine, serving up relevant content and research based on the past clicking behaviour of the client, as well as a product spotlight, akin to a story on Instagram,” she said.

As this news service recalls, a few years ago, there was a lot of debate on whether IT budgets could reconcile demands to spend on growth versus complying with new rules. 

“For a long time, firms made tactical decisions over their digital transformation efforts, targeting investment on automating back-office processes largely to help meet a series of new pieces of regulation. But now there is a real pivot to the front-office, with clients increasingly demanding 24/7 servicing. Deploying digital tools has really become critical to both alleviating capacity constraints on advisors and making more strategic decisions around creating more personalised experiences for end clients,” Ciriani said.

Pandemic and its aftermath
WealthBriefing asked Ciriani how the pandemic-induced change to working patterns has affected her business.

“The pandemic exacerbated the issue of technology debt, as well as the gulf between firms’ varying capabilities. Fortunately, even where the technology debt is particularly pronounced, the InvestCloud Digital Warehouse overlays existing systems and aggregates client and financial data, allowing firms to make the most of their data and avoiding the perils of technology debt. This drives operational efficiency with what we call ‘enter once and only once’ data management.”

Pain points remain in an industry where a number of tasks are still performed manually. 

“Onboarding in the private banking space compared to retail banking is still a highly manual process. AI-driven profiling and KYC screening not only delivers greater automation to speed up onboarding timeframes but really helps relationship managers identify the right HNW clients to drive forward growth,” she said.

One term that arose in the conversation was “hyper-personalisation.” Ciriani explained what sort of examples of this process InvestCloud is engaged in.

“Hyper-personalisation starts by taking a design-first approach, infused with behavioural science. This means designing user experiences that are tailored to each person, as well as allowing individual users the freedom to further customise their experiences,” she said. “In addition, leveraging an equally strong data-driven approach means firms can go beyond traditional wealth segmentation. This allows us to create really empathetic client experiences that are truly tailored to the individual and their financial goals.”

InvestCloud’s Next Best Action engine really allows advisors to deliver hyper-personalisation at scale. It leverages AI trained on historical information to serve up custom recommendations for products and actions to take on an individual client’s portfolio and learns over time based on their clicking behaviour and updates to their financial plan,” she said.

Finally, this news service asked what isn't being addressed by industry so far, but which should be.

“One area the industry hasn’t addressed to date is the transition from giving financial advice to really aiding people with their financial wellness. Individuals want different services depending on where they are in their wealth journey. Digital solutions can provide the ability to provide tailored advice and journeys that are relevant to those starting to invest for the first time to those who are extremely sophisticated investors. Education and engagement are important for both but the level of content and journeys should be personalised,” she said. “We’re using behavioural science and educational tools to not only increase a client’s engagement with their financial plans but to give clients the tools that allow them to take actionable steps to improve their financial future, in turn giving a greater sense of control and wellbeing.”