For the last couple of years, one of my regular activities has been speaking about the effect of e-commerce at the various IFA UK shows around the country. Only two years ago virtually all the content I was covering in these sessions involved looking at services that were operating in the US and were likely to cross the Atlantic in due course.
The message at the time was that within just a couple of years similar services would establish themselves in the UK. I am sure many people were cynical about the prospect of such services establishing themselves so quickly, yet in this year's shows I am looking solely at services operating in the UK.
Personal finance e-commerce is no longer an area being addressed by a handful of new media enterprises.
It is great to see that more and more IFA firms are launching their own online sites. And these are becoming more than just mere poster sites with static information. Many now contain an increasing range of interactive client services, allowing the internet to begin to fulfil its potential as a valuable tool for advisers to enhance their face-to-face advice with back-up services 24 hours a day.
Like most things in life, there is a hard way and an easy way to do this. It is fair to say that you can pretty much deliver anything you want over the web these days as long as you are prepared to pay for it.
If your budget is sufficiently large, you can have an individual presence tailored to exactly your own design and taste. However, you are going to have to have very deep pockets if you want to build powerful client-facing services on a one-off basis. And you will be standing in line for support and resources from insurers with large numbers of other firms who are also looking to launch their web services.
The easy way is to work with one of the increasing number of organisations with specialist knowledge of online financial services which have developed tools IFAs can use to power their web presence.
These create natural economies by building a service once and allowing many IFAs to use it. The more users you have, the more the development cost is spread. This is important as building web technology becomes an ever more expensive pastime.People with the right dev-elopment skills are increasingly in demand on the emp- loyment market.
In my view, the plethora of free internet services for IFAs is creating a market distortion and giving IFAs the impression that such services are going to be free in the long-term. There is clearly a land grab going on between the various players in the market at this time. In the short term, anyone not offering a basic free service is missing an opportunity to capture market share in the B2B2C area.
Having said this, I would question how long this is sustainable. It will become essential for these providers to migrate early adopters of their free sites to services with tariffs relatively quickly. Just like everything else, IFAs will get what they pay for from technology. Those who insist on expecting things for free must realise that in the long term they will miss out on the opportunities to benefit from the best services.
AssureWeb's IFA Window, The Exchange's Adviser Web Builder and M-Link's Web Builder have now been joined by companies like MyMoneyAdviser and IFA Systems, offering low-cost options for IFAs creating their own sites.
Each provides a range of bolt-ons, with menu-driven pricing to allow firms to make their site as powerful as they can within affordable limits.
For those at the higher end of the market, it is also important to mention two further firms which have carried out some outstanding work. For the IFA business that truly wants to integrate its customer facing advice, back-office systems and web presence, I have still to see anything that is remotely as powerful as the offering that CMG has put in place for Towry Law and is also rolling out to a number of the other very large players. Such quality comes at a price, but if you want the best you have to be to pay for it.
For those who cannot quite run to CMG prices, it is probably well worth having a close look at Screenpages. It is now two years since it became the first web builder to enable an IFA to give clients access to their portfolios from the adviser's back-office system.
Since then, a number of impressive sites have been created for such well known names as Inter-Alliance, Willis National and Aitchison & Colegrave. The above are just a few of the market leaders in this important area.
Late last year, I was approached by IFA Promotion and the Association of Independent Financial Advisers and asked if the Financial Technology Research Centre would compile a summary of companies able to help IFAs build their web presence.
This turned out to be no small task. However, I am pleased to say by the time you read this, all IFA Promotion members should have received a copy of the 75-page Guide to Building your IFA Business Online.
In my IFA UK talks this year, I am examining the level of web offerings that IFA firms need to be providing if they want to stay up with their leading peers. At the same time, these sessions aim to give all advisers the opportunity to benchmark their own progress in this important area.
The presentation also covers other issues which should be considered when building a web presence and how to make sure your staff take full advantage of your web service once it is up and running.
To bring home the fact that this technology is no longer beyond the reach of even the smallest IFA, I demonstrate during this session what can be done for under Â£150 a month. This is all it takes for a site that allows clients to buy Isas and other managed funds online, compare select and apply for mortgages, obtain comparative term and critical-illness cover comparisons, and service employee members of stakeholder and other group pension schemes.
Admittedly, at that price it will not be the prettiest website in the world but it is the functionality that matters. If you spend a little more, it should be possible to polish such presences substantially and still remain affordable.
Future IFA UK shows include the Scottish Exhibition Centre, Glasgow on March 8, Celtic Manor South Wales on March 22, and the Royal Armouries on April 26, and London Novotel on May 3.
For details of other IFA UK events see the website at www.ifaevents.co.uk.