It is a common misconception that the people most switched on in terms of IT and digital engagement are the young. Accessing the internet on the go is increasing among all ages. According to the Office for National Statistics, around one-third of over-65s went online while they were out and about in 2015.
Last year’s Ofcom Communications Market Report found smartphones had overtaken laptops as the most popular device for getting online. It also revealed older people are buying into the benefits big time, with smartphone ownership among 55-64-year-olds more than doubling since 2012 from 19 per cent to 50 per cent. And we should not forget the rise of tablets. Research firm eMarketer predicted there would be 33 million British tablet users by the end of 2015, with half of them using an Apple iPad.
Another common misconception is high-net-worth individuals are not particularly interested in accessing details about their financial situation online. However, this kind of digital discrimination poses a real threat to future success.
The 2014 Capgemini World Wealth Report focused on this issue and found high-net-worth clients are just as likely as any others to want to engage digitally with their financial affairs.
It highlighted that those advisers who remained wedded to a highly personalised proposition via direct interactions were vulnerable to losing out to wealth advisers that embraced the opportunities offered via digital engagement.
Of course, I am not disputing the fact high-net-worth clients are likely to continue to value and expect personal interaction with advisers.
However, in this digital age, they also expect to have a suite of tools available that gives them the flexibility to choose when to engage directly and when to review aspects of their portfolio independently and remotely via the web.
The Capgemini global survey found 56 per cent of high-net-worth individuals in Europe said all or most of their wealth management relationship was conducted via digital channels, with 61 per cent expecting this relationship to be conducted in such a way in five years. That figure would almost certainly be higher if such research was carried out today.
Perhaps the biggest call to action for wealth advisers reluctant to adopt digital information channels is the report’s findings that ultra-high-net-worths are almost equally likely as the lowest tier high-net-worth clients to consider leaving firms that do not meet their digital needs. The report also found mobile apps received the highest level of acceptance among high-net-worth clients. While apps can often provide much the same functionality as websites, their added elements of spontaneity and convenience through a compact, dynamic interface makes them an attractive alternative.
As we have already discovered, the laptop is losing out to mobile devices as the hardware of choice for accessing information on the move.
So, all the evidence points one way: advisers need to ensure they are switching on to the fast pace of change in terms of client expectation and online engagement. Those whose propositions are mainly targeted at high-net-worth individuals must act quickly to build a model that offers a suite of digital options. If they do not, there is a real risk their clients will go online and find another adviser fully switched on to their needs.
Nick Eatock is executive chairman at Intelliflo