Mobile apps have increasingly become the first resource that investors consult to review their investments, make transactions and conduct research, positioning digital as a critical component of the wealth management client experience, a new study suggests.
According to J.D. Power’s 2022 U.S. Wealth Management Digital Experience Study, the trend is particularly pronounced among younger investors, who have significantly higher overall satisfaction and stronger brand advocacy when they engage frequently with their firm’s wealth management app.
“Wealth management firms that want to attract and retain younger investors need to focus on continuing to improve their apps,” says Michael Foy, senior director of wealth intelligence at J.D. Power. “The mobile app really is becoming the center of the modern wealth management client user experience, and that’s true not just for do-it-yourself investors but also for those who work with a financial advisor.”
Moreover, app users are engaging much more frequently with their brand and—when they have a positive experience—are much more likely to recommend that brand, adds Foy. For purposes of the study, J.D. Power defines generational groups as Pre-Boomers (born before 1946); Boomers (1946-1964); Gen X (1965-1976); Gen Y (1977-1994); and Gen Z (1995-2004). Millennials (1982-1994) are a subset of Gen Y.
Key findings of the 2022 study include the following.
Apps significantly outperform websites: The overall average satisfaction score for U.S. wealth management mobile apps is 731 (on a 1,000-point scale), which is 50 points higher than the average score for wealth management websites (681). This gap is driven largely by a significant preference for apps among younger investors, the study notes.
Mobile apps essential for attracting and retaining younger investors: Customer satisfaction with mobile wealth management apps is highest among members of Gen Y, with an average score of 760. Members of Gen Z follow with an average score of 720. At the same time, however, members of Gen X, Boomers and Pre-Boomers—all of whom are more likely to use their wealth management firm’s website—have lower satisfaction with mobile wealth management apps.
Great apps drive strong brand loyalty: Top-performing mobile apps, which earn the highest levels of overall customer satisfaction, also have strong brand advocacy, as measured by average Net Promoter Scores (NPS) of 83 (on a scale of -100 to 100). That compares with an NPS of 73 among top-performing websites.
Important for full-service investors, too: Contrary to the perception that mobile wealth management apps and websites are designed primarily for do-it-yourself (DIY) investors, overall customer satisfaction scores are higher among advised investors, who are more likely to use the digital financial tools provided by their wealth management firms, including tools that help connect them to their financial advisor.
“Digital has become a key component of the overall wealth management customer experience,” notes Amit Aggarwal, senior director of digital solutions at J.D. Power. “Firms that are delivering the best overall digital experience are recognizing that their apps and websites are an extension of the client relationship and can be leveraged to improve relationships with advisors, drive brand loyalty and differentiate from the competition.”
With a score of 728, J.P. Morgan Wealth Management ranks highest in overall customer satisfaction with the wealth management digital experience, followed by Charles Schwab (726), Edward Jones (710), Wells Fargo (707) and Ameriprise (703) rounding out the top five.
The study evaluates customer satisfaction with the wealth management digital experience, inclusive of both apps and websites, based on four factors: visual appeal; navigation; speed; and information/content. This year’s study is based on responses from 6,375 full-service and self-directed investors and was fielded from June through August 2022.
