Millennials are growing up and are set to make up a large portion of the affluent market segment seeking out quality advice, but according to new research by Netwealth, this could be problematic for advice firms.
While 1.5 million Millennials control approximately $2.2 trillion in household wealth, they have grown up as digital natives and are looking to engage technologically apt advisers.
Namely, according to Netwealth, as many as 46.5 per cent of millennials look at their banking app or portal daily, while half view and manage their superannuation using a website or app at least monthly. Moreover, 43.1 per cent manage their investments using an online broking service at least monthly.
But more importantly, around half of the emerging affluent rank a firm’s digital offering in the three most important things when selecting a financial planning firm.
Commenting on the report’s findings, Matt Heine, Netwealth’s joint managing director, said the pandemic has highlighted the importance of digitising the adviser-client experience. But the onset of a new client type — the emerging affluent — has accelerated this journey.
“As digital natives, advice firms will need to double down their digital investment, but the pay-off could be hugely favourable, as the emerging affluent might be their future client base,” Mr Heine said.
To that end, Mr Heine stressed that a client experience has to be more than a Zoom meeting. Instead, client portals have been identified as the next frontier in customer engagement.
“The first trend we uncovered is the significance that client portals play in enhancing the overall customer experience. Delivering them via mobile app has the capacity to evolve the client-adviser relationship beyond in-person interactions,” Mr Heine said.
“They provide an always-available and omnipresent reminder of the adviser, evolving and supporting the relationship from a physical one to a hybrid digital one.”
Hey Matt….let me remind you that the Electronic Transaction Act in Australia came into effect in 1999. Several years after Adobe Sign was established. Whilst for NetWealth et all, it is was what … 2020 and only then caused by Covid. Some 20 years…yes 20 years later so it’s hilarious you given me a lesson on being “tech savy”.
I would much prefer you to lobby the Government to reduce regulatory red tape, championing and promoting genuine conflict free advice, making Advice Tax Deductible, pushing advice fees to come out of Super funds, rather then Mr Dinosaur…Mr 20 years too late…. telling me “tech is more than Zoom”. Look…thanks…..but given the amount of over regulation, the advice process when compared with an 8 second attention span of a “emerging affluent” .. created by a 15 second Tik Tok post I simply can’t….don’t need too…. or want to be even going near the Emerging “effluent”…I say “emerging Effulent as that is what eventually will happen to Australians without access to affordable face to face advice.
Before advice firms invest lots of money in the sorts of tools Millennials love, they need to consider how much of the Millennial market is receptive to professional advice and willing to pay what it costs. I reckon not many.
They was this industry is going there will be no one left to give advice. Simple