Investment Providers Lean into Digital Channels and Personalized Communications

November 28, 2022 — Boston

Retaining investor mindshare will depend on a segmented approach, leveraging burgeoning communication channels

Inundated with the amount of investment advice resources available, today’s investors are eager for guidance from a reliable source. Providers that can leverage their status as a trusted resource and provide a path of least resistance when it comes to investment advice will be able to raise client awareness and drive increased adoption, according to the latest Cerulli Edge—U.S. Retail Investor Edition.

41% of investors most frequently use the websites of financial services providers as the top source of investment guidance. These websites frequently are the primary, and in many cases the only, resource on which users choose to rely. Rated highly by current clients, they offer wide and deep educational opportunities for investors. “These clients already have chosen to entrust their assets to these firms and believe that the firms are dedicated to serving clients’ interest, making the decision to rely on them for information a natural choice,” says Scott Smith, Cerulli’s director of advice relationships.

Incumbent providers can leverage the breadth of data they have accumulated about their clients to help personalize their experience. Investors are rarely aware of the full scope of products and services their providers offer, but do express a preference for using their existing providers for their emerging needs. By reminding existing clients of the breadth of their platforms’ offerings on an ongoing and just-in-time basis, providers will be able to further drive client adoption.

At the same time, next-generation investors are consuming investment advice through additional channels. Providers can’t ignore the changing nature of information exchange and the power that new platforms, such as social media and podcasts, have to influence investors. The research finds that 32% of investors 40 years or younger are using social media and podcasts as an investment advice resource. However, platforms such as TikTok that are much more highly embraced by younger client prospects have yet to become much of a focus for many wealth management providers.

"Firms that choose not to include engaging social media efforts as part of their strategy, along with other sources of investment advice, forgo the opportunity to build brand recognition with the next generation of investors, says Smith. “Firms that truly want to connect to these markets will have a much easier path by offering themselves where their prospects already are consuming content,” he concludes.

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Note to editors

These findings and more are from The Cerulli Edge—U.S. Retail Investor Edition, 4Q 2022 Issue.

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