Three Takeaways from the GFMI Digital Transformation in Wealth Management Conference

Last week at the GFMI (Global Financial Markets Intelligence) Digital Transformation in Wealth Management conference in New York City, digital transformation, marketing, and innovation leaders from wealth management firms across the country gathered to discuss the current state of technology and marketing at their respective firms. Attendees represented firms ranging from some of the largest in the world to midsized firms, and even new financial technology startups.

The two day conference was eye opening in terms of how firms are approaching digital transformation, and three top priorities quickly become apparent: roboadvisor platforms, attracting younger audiences, and revolutionizing the client experience.

Firms are taking wildly different strategies when it comes to approaching roboadvisor platforms

Arguably one of the most impactful technology disruptions over the past decade in wealth management, roboadvisors—algorithmically driven financial planning and investment with little to no human assistance—have become quite popular among novice investors. Startups like Betterment and Wealthfront now have thousands of customers and have become a potential competitive threat to large wealth management incumbents.

At the conference, firms such as Wells Fargo, Morgan Stanley and Fidelity provided insight into how they are planning their strategies around roboadvisors. While it was unanimous that “robos” need to be a priority in their digital strategy, how exactly that would come about differed greatly among those presenting. Some saw robo platforms as competitors; others saw them as potential partners. Some were developing their own in-house roboadvisors; others were waiting to see what happens with the current third-party platforms. Some are marketing them to millennials, whereas others were marketing them to existing older clients.

Ultimately, there doesn’t appear to be a blueprint among incumbent wealth management firms on how to handle the rise of roboadvisors, and it will be very interesting to follow their plans as they become more fully developed.

Millennials are a top target demographic

By 2020, millennials will be the main beneficiaries of a massive $30 trillion transfer of wealth from their baby boomer parents. How wealth management firms actually acquire these beneficiaries as client was a main point of discussion among conference attendees.

Many made note of the fact that millennials have a distrust of large financial institutions, having come of age during the Great Recession. They are also noted for their financial illiteracy and general lack of awareness of what financial planners can offer them. These are major challenges for incumbent financial institutions, and compounding the issue is how millennials prefer to interact with the brands with which they do business. Based on the super personalized, omnichannel experience offered by consumer tech brands like Amazon, Google, and Netflix, younger demographics have set an incredibly high bar for businesses in other industries, and wealth management is no exception. Many of the presenters at GFMI hoped to find ways to counteract this and offer a technology enabled client experience before those large tech behemoths decide to offer financial planning services themselves.

2018 is the year in which the client experience is revolutionized in wealth management

Speaking of client experience, wealth management firms are working hard to update how advisors and firms at large interact with all clients, regardless of age. Greg Sullivan, CEO of Sullivan Bruyette Speros & Blayney (a Seismic customer) noted the improvement in client communications that content automation and sales enablement has brought to his advisors, while also facilitating automatically personalized and compliant content creation. Others, such as representatives from Wells Fargo and Bank of Montreal, spoke to the need for client information and communications to be consistent across all channels, whether it is on digital platforms or through human advisors.

The main takeaway from GFMI was that, like most industries, wealth management is going through a period of disruption due to rapid technological innovation. While this poses a few challenges, overall, the sentiment was that those in the industry that adopt new technologies and processes the quickest will be the ones who stand to gain a disproportionally large slice of the growing economic pie in the near future.


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