Asset managers’ digital strategies drive investment inflows, says JD Power
TROY, Michigan – (COMMERCIAL THREAD) – The Financial Services Wholesalers Luncheon is dead. Cheers for online webinars, websites and active social media accounts. While the ranks of wholesalers were already shrinking before the pandemic, the arrival of COVID-19 has only accelerated the trend for more digital engagement between asset managers and financial advisers. According to the JD Power 2020 Digital Consultant Engagement Study,SM released today, asset managers who have the highest levels of digital engagement with advisors also get the best brand perceptions and reap the highest inflows of new investments from those advisors, while managers assets with less digital engagement fall even further behind.
“For asset managers in today’s market, forging and maintaining successful relationships with advisors is increasingly a matter of effective digital engagement, ”said Mike Foy, Senior Director of Wealth and Loan Intelligence at JD Power. “This trend has been happening for some time, but it really accelerated during the pandemic, with wholesalers unable to meet face-to-face and counselors citing higher stress levels and increased workloads. In this context, asset managers need to provide easy access to relevant content and resources across multiple digital channels, including content that can help them do their jobs more effectively and grow their practice.
Here are some of the main findings of the 2020 study:
- An effective digital strategy stimulates the intention of advisors to invest: Asset managers who build strong digital relationships with advisors see significantly higher investment flows from these advisors. Specifically, the top four asset management companies with the highest scores on multiple digital experiences (Capital Group, BlackRock, JP Morgan, and MFS) also have the highest levels of investment intent among advisors.
- Investors in a hurry need easy access to information: Due to the pandemic, counselors are more pressed for time than ever, with 58% citing increased stress and anxiety, and 25% saying their working hours have increased. As a result, the digital engagements that resonate the most are those that provide easy access to content and asset management resources.
- Webinars win the day: Among the different types of digital interactions, webinars show the largest increase in advisor engagement, with 56% of advisors reporting having attended their leading asset management firm’s webinar in the past six months, compared to 34% in 2019. Email and websites also saw their use increase year over year, as did social media.
- Advisors remain skeptical about ESG engagement: A company’s commitment to environmental, social and governance (ESG) issues is one of the most important drivers of an asset manager’s reputation, and 55% of advisors say they are very likely to invest more in brands that they identify as committed to ESG. However, advisors perceive that only 15% of the brands they currently work with are actually engaged on this issue.
- When it comes to digital, not all advisors are equal: Asset managers need to understand which segments of advisors are the most open and digitally influenced versus those who always want a more personal interaction with wholesalers. Advisors with 16 or more years of industry experience are much more likely to rely on digital interactions with asset managers than those who have only been in the industry for five years or less. Likewise, independent advisors (and those who invest primarily in ETFs) are more likely than wire house brokers (and those who invest primarily in mutual funds) to rely on digital.
The 2020 Advisor Digital Engagement study, now in its second year, assesses how financial advisors digitally interact with asset management companies and how this digital experience affects their brand impressions and future intentions to invest client assets. with these companies. Digital engagement is rated across multiple channels including email, mobile apps, podcasts, social media, webinars, and websites. The study is based on 26,174 brand ratings of 1,330 respondents from financial advisers and was conducted from May to July 2020.
For more information on the 2020 JD Power Consultant Digital Engagement Study, visit https://www.jdpower.com/business/resource/advisor-digital-engagement-study.
To view the press release online, please visit http://www.jdpower.com/pr-id/20147.
JD Power is a global leader in consumer information, advisory services, data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has for more than 50 years provided incisive industrial intelligence on customer interactions with brands and products. The world’s largest companies in major industries trust JD Power to guide their customer-centric strategies.
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