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Indie Advisors: Better Tech Would Improve Client Acquisition

Managing a Practice

Most independent advisors report satisfaction with their technology capabilities, but they still see opportunities for improved technology to better meet their practice goals. 

According to survey results of more than 400 U.S. financial advisors, 83% argue that better technology tools would greatly improve new client acquisition—especially as 32% of advisors express interest in prospecting outside of their current geographic area and will rely on improved technology tools to reach prospects virtually. 

Sponsored by Broadridge Financial Solutions and the Financial Services Institute, the survey also found that 58% of advisors describe their practice as a “solo” practice. Among the remaining 42% of advisors who describe their practice as a “team” practice, the average team size is four, demonstrating that advisors are increasingly reliant on technology tools to service clients and fill the personnel gap.

While most advisors (60%) are equally focused on financial planning and investment management, advisors under the age of 45 cite client-facing tools as the No. 1 area for technology improvement as they focus increasingly on holistic financial planning.

The advisor community also has an opportunity to make stronger connections with the next generation of investors, as well as drive impact around ESG, financial literacy and wealth transformation, according to the survey. 

“This joint study with FSI highlights the growth opportunities for financial advisors and the heighten role technology tools play in enabling advisors to provide a better service experience, foster deeper relationships and reach new constituencies,” says Chris Perry, President of Broadridge Financial Solutions. “Advisors are taking advantage of this wave of digital transformation to provide investment ideas, offer financial literacy tools, discuss ESG trends and connect with clients and their families in new ways.”

Social Media and Video 

LinkedIn (77%) and Facebook (67%) are the most widely used social media platforms by advisors for both business and personal use, providing other channels where advisors can reach their clients virtually, according to the findings. 

Video conferencing is also alive and well, and is not expected to go offline anytime soon. Slightly more than half (51%) of advisors report that they are still conducting formal client meetings virtually—either via phone or video conferencing. 

Advisors expect to increase their video conferencing usage in the next 12 months (39% versus 21% currently using video conferencing). At the same time, nearly 9 in 10 (88%) advisors expect to either increase or maintain their current rate of in-person, formal client meetings in 2022.

Family Connections

As to building relationships with that next generation of clients, 89% of advisors say they have engaged or plan to engage with additional generations of existing clients, such as children or grandchildren. 

Of the advisors “currently or planning to engage” with those additional generations, roughly 8 in 10 (79%) directly raise the topic with their clients and 55% say they offer to build the financial literacy of clients’ children or grandchildren.

Most advisors also prioritize engaging their clients’ spouses in financial discussions, as 9 in 10 advisors consider it important to maintain a strong relationship with both spouses. Advisors say that on average, 68% of formal client meetings include both spouses.

Interest in Crypto and ESG 

Meanwhile, the findings further show that investors apparently are seeking creative ways to find returns, with 64% of advisors reporting that they have seen an increased interest in cryptocurrency from clients. Moreover, 33% of advisors report that they have seen an increased interest in ESG investments from clients. 

“With the rise of DIY investing and clients’ growing interest in branching out to new asset classes, financial literacy is of the utmost importance and advisors have a clear role to play,” says FSI President and CEO Dale Brown, in noting that there is a significant opportunity for advisors to educate current and prospective clients. 

Fielded in November 2021, the survey of 493 financial advisors and employees of financial advisory firms was conducted by 8 Acre Perspective.