Technology That Helps Advisors Automate

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Financial advisors face growing competition from robo-advisors. By 2020, A.T. Kearney analysts reckon that robo-advisors will accumulate $2 trillion in assets. Traditional advisors must adapt to these changes by implementing effective growth strategies, improving margins through cost containment and maintaining a high level of client service. New technologies can help achieve these goals and better compete in the market.

In this article, we will look at how advisors can leverage technology to increase sales and improve client service with less overhead costs. (For more, see: The Biggest Tech Mistakes Financial Advisors Make.)

Automate Mechanical Tasks

Financial advisors are often the highest paid members of a practice, which makes it important to invest in technologies that free up their time for high-value activities. Surprisingly, relatively few advisors employ these kinds of technology in their practices, which creates a significant opportunity for first-movers to set themselves apart. Many of these technologies are quickly evolving, however, from a nice-to-have to a must-have to remain competitive.

Portfolio rebalancing is arguably the most popular task that can be automated since it saves time and eliminates most common errors in the process. According to Financial Planning, the number of advisors using portfolio rebalancing software jumped from 39.4% in 2013 to 62.7% in 2015. Advisors that aren’t leveraging these technologies risk losing their competitive edge in an industry that’s increasingly dominated by tech-savvy firms.

There are also many less obvious tasks that are ripe for automation. Appointment reminders, billing statements and other clerical tasks can be easily automated using most modern customer relationship management (CRM) solutions. Advisors can also automate support services using self-serve client portals or weekly e-mail updates that provide access to investment performance and other account details. This information can help reduce inbound calls and improve client satisfaction. (For related reading, see: Tech Trends Financial Advisors Must Stay Ahead of.)

Follow-Ups With Leads and Clients

Most financial advisors have a lot on their plate between juggling a high number of clients and reaching out to new prospects. New technologies make it easier than ever to set up automated reminders to ensure the right amount of follow-up for leads and regular contact with clients. By automating these tasks, advisors can increase the number of clients that they serve to increase revenue and improve profit margins over the long term.

Many advisor CRM platforms enable advisors to set up reminders to follow-up with potential leads over time. For example, MailChimp and other e-mail marketing platforms have automated workflows that can help send out timely e-mails to prospects to keep them engaged.

Advisors can use these same technologies to keep on top of existing clients. Redtail CRM’s workflows enable advisors to set reminders for events like client birthdays, anniversaries and reviews to keep their relationships healthy. Blueleaf’s platform provides automatic branded weekly updates to clients to reduce in-bound calls, while alerting advisors when something goes awry with a client’s portfolio to preemptively address the problem. (For related reading, see: New Apps for Advisors Who Work Remotely.)

Choose the Right Vendors

There are many different technologies designed to help financial advisors, ranging from customer relationship management to portfolio rebalancing. It’s tempting to choose these vendors based on their cutting-edge features, but integration with other third-party vendors is often overlooked. The lack of integration can create an environment where information is difficult and time-consuming to access across platforms.

The best solutions integrate with a large number of third-party vendors. For example, Redtail CRM integrates with companies Riskalyze for portfolio analysis or BlueLeaf for data aggregation. This makes it easy for financial advisors to quickly access information across platforms and avoid wasting time fulfilling requests or communicating with clients.

Advisors should also consider selecting a single holistic provider like Tamarac or Orion rather than trying to piece together multiple third-party vendors. By doing so, they can avoid the headaches of integrating and upgrading various software platforms over time. Advisors also benefit from paying a single technology bill each year rather than dealing with many invoices.

The Bottom Line

Financial advisors face increasing pressure to grow their top line, reduce costs and deliver exceptional client service. New technologies can help advisors achieve these goals by automating mechanical tasks and maintaining the right level of contact with prospects and clients. The key is ensuring that these technologies work seamlessly together to eliminate any headaches and produce the highest return on investment. (For more, see: Top Tools Every Financial Advisor Needs.)

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