Report reveals insights on making the most of technology to acquire and service clients

Franklin Templeton and AdvisorEngine today announced the release of a new study, “Fintech for RIAs: Elevating Client Experience,” which found that the majority of RIA clients expect to have digital technology in place for making investment decisions with their advisors, and a great digital experience is now a major differentiator for RIA firms.

“As new fintech tools abound, RIAs are examining which solutions will be most useful in creating a high-quality digital experience for their clients,” says Jonathan Kingery, Head of Private Wealth at Franklin Templeton. “We’re in the midst of the fourth industrial revolution, and the accelerated pace of technological advances is rapidly refreshing how financial solutions are delivered.”

Franklin Templeton and AdvisorEngine, in partnership with Institutional Investor’s Custom Research Lab, launched a research study comprising a survey and interview program among RIAs in the US. The survey, fielded in September 2021, included responses from 152 independent RIAs to examine the utility of and outlook for investment in financial technology focused on acquiring, serving and supporting investment advisory clients.

A call for client-centric technology

The data revealed that RIAs were most interested in client-facing technology. For example, client on-boarding usually takes about seven days but, with updated technology, can be cut down to two, playing a major role in advisor-client relations.

In fact, more than 80 percent of survey respondents see a critical or moderate need for automation support for four processes: client on-boarding, day-to-day client service, analysis of data through the client lifecycle, and marketing and business development outreach to tomorrow’s clients.

“RIAs’ interest in technology stems more from their desire to service clients more completely and responsively than from eagerness to avoid or offload administrative work,” says George Tamer, Head of Sales at AdvisorEngine. “It’s no secret that tech will continue to play a pivotal role in wealth management. But the question now is, ‘What are the most useful ways to plug them into a financial advisor’s daily work?’”

Younger clients (and incoming employees) expect a high-quality digital experience

Sixty percent of respondents strongly agree that Gen-X and millennial clients are likely to expect investment advisors to provide digital technology for communicating and making investment decisions with their RIAs.

This trend is seen not only on the client side but on the hiring side as well, which is especially important amid a tight labor market. Forty-one percent of survey respondents strongly agree that “an RIA firm’s digital infrastructure is increasingly important in hiring and retaining first-rate professional talent.”

Will more technology mean that applications and algorithms will replace more traditional investment advice?

Survey data on this says “no.” RIAs in this study are more than three times as likely to view the next generation of investment management technology as “complementary” to their current way of serving clients rather than as a disruptive threat to their professional practice.

Ultimately, 69 percent of respondents feel the greatest value for technology integration is the ability for asset/account aggregation that provides a unified view of holdings to clients. Once again highlighting the way that client needs are generally the catalyst for new technological investments for RIAs.

Methodology

Franklin Templeton and AdvisorEngine, in partnership with Institutional Investor’s Custom Research Lab, conducted a research study comprising a survey and interview program among RIAs in the US. The survey included responses from 152 RIAs to examine the utility of and outlook for investment in information technology focused on acquiring, serving and supporting investment advisory clients. The questionnaire was fielded in September 2021.

About Institutional Investor

For more than 50 years, Institutional Investor has consistently distinguished itself as the world’s foremost financial publication and convener of global institutional investors. By leveraging Institutional Investor exclusive memberships, forums, industry benchmarks, award-winning content, and workflow solutions such as capital placement, Institutional Investor is the essential hub for the world’s financial decision-makers.

About AdvisorEngine®

AdvisorEngine powers financial advice that is personal, scientific, and beautiful. Its wealth management technology platform uses smart automation to modernize the advisor experience (AX), the business operations experience (BX), and the client experience (CX). Capabilities include CRM, prospect engagement tools, paperless client onboarding, account aggregation, goals-based financial planning tools, model portfolios tools, portfolio construction analytics, compliance tools, performance reporting, and fee billing. Based in New York, NY, and Raleigh, NC, the AdvisorEngine team strives to fulfill six ideals through their work: camaraderie, clarity, curiosity, creativity, crushing it, and celebration. AdvisorEngine is a wholly owned subsidiary of Franklin Resources, Inc. For more information, please visit advisorengine.com and follow us on LinkedIn, Twitter and Facebook.

About Franklin Templeton

Franklin Resources, Inc. [NYSE:BEN] is a global investment management organization with subsidiaries operating as Franklin Templeton and serving clients in over 155 countries. Franklin Templeton’s mission is to help clients achieve better outcomes through investment management expertise, wealth management and technology solutions. Through its specialist investment managers, the company offers boutique specialization on a global scale, bringing extensive capabilities in equity, fixed income, multi-asset solutions and alternatives. With offices in more than 30 countries and approximately 1,300 investment professionals, the California-based company has 75 years of investment experience and approximately $1.5 trillion in assets under management as of February 28, 2022. For more information, please visit franklintempleton.com and follow us on LinkedIn, Twitter and Facebook.

Franklin Distributors, LLC. Member FINRA/SIPC. Franklin Distributors, LLC, and AdvisorEngine are Franklin Templeton affiliated companies.

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