Many Financial Advisers Prioritize ‘Ease of Business’ From Asset Managers

When it comes to choosing the asset managers they work with, financial advisers are prioritizing “ease of doing business” and their potential partners’ digital capabilities, according to J.D. Power’s annual Adviser Online Experience Study, the results of which were released Thursday.

According to a survey of about 2,300 financial advisers, J.D. Power found that advisers naturally prioritize investment returns from asset managers. But also high on the priority list was ease of doing business, at 37% of those surveyed. So while, as the researcher put it, “every asset manager promises strong returns,” a message around simplicity and seamlessness may be a good differentiator for an asset manager.

Multiple options for digital interactions also showed up as a high priority for wealth managers. Of those advisers surveyed, fewer than 7% said they prefer to rely on a single engagement channel when working with asset managers. Instead, a vast majority prefer a mix that includes phone/video calls (73%), email (70%), digital websites and apps (56%), and in-person visits (55%).

While returns will always be important, differentiation in “hyper-competitive” asset manager selection is increasingly important, particularly as the survey showed advisers are working with fewer asset managers than in years past, notes Craig Martin, executive managing director and global head of wealth and lending intelligence at J.D. Power.

“Advisers’ time is precious, and the more asset management partners they work with, the more time is required to manage these different relationships and gain knowledge on the various products,” Martin says. “Many asset managers can offer a wide variety of products and solutions under the corporate umbrella, which is allowing advisers to have more of their needs met with a smaller number of partners.”

According to the survey, wealth managers said they are working with an average of seven asset managers after holding steady at eight over the past three years.

This year’s results showed an improvementson user and digital experience—differing from the consumer insights and analytic firm’s 2023 report, which showed displeasure with many asset managers’ online experiences.

Martin says the multi-channel focus for wealth managers was interesting in that it differed to some extent, based on where an adviser is in their career.

“Advisers that are earlier in their career are more apt to see value in live interactions to learn about products and best practices,” Martin says. “More seasoned advisers tend to see the value of live interactions as a way to get support with specific things. This is most likely due to the fact that these advisers feel they have a fairly high level of experience and knowledge, which has made them successful, and the value of live support is to address specific issues.”

Meanwhile, the head of wealth intelligence believes advisers are focused on ease of business and quality digital experiences in part to meet evolving individual client needs—with many of those clients seeking broader financial planning services.

“Additionally, we are seeing an evolution in the adviser-and-client relationships, with an increased focus on moving away from a more transactional product and service provider focus [and moving] to a truly trusted adviser that’s focused on clients’ needs and wants,” he says. “The expectation of the client is that the adviser has good products and services, but the specific details are not as important as what it helps them achieve on a personal level.”

One way asset managers can help their cause, according to the surveying, is for their wholesalers to be ready to work with financial advisers on the asset manager’s digital capabilities. At the moment, about 37% of advisers said they receive “no support or guidance on using asset manager websites or apps from their wholesalers or representatives.”

Many of the country’s largest asset managers were used as examples for the advisers to review in the report, but J.D. Power did not provide individual scores or rankings for the firms.

The U.S. Advisor Online Experience Study evaluated adviser interaction with asset manager websites based on four factors: speed; information/content; visual appeal; and navigation. This year’s study was based on 2,329 evaluations from financial advisers and was fielded from June through August 2024.