Web sites geared toward financial advisors have changed dramatically in the past few years, and even more dramatic improvements are expected. The changes are being driven by competition and the need for mutual fund sellers to forge even closer links with intermediaries.
Firms that sell financial products have no choice but to catch up with the head of the pack if they want to continue to attract advisors and the huge pool of client assets they represent. Most industry leaders have been smart enough to change with the times and continually upgrade their Web offerings, according to Dalbar Inc. <\/b>, a research firm with offices in Toronto and Boston. The laggards, in turn, are losing ground.
\u201cIf there is one area in which many fund companies\u2019 sites fall short, it is the level of sales support that they offer advisors,\u201d says Mark McDonald, Dalbar\u2019s manager of client and public relations in Toronto. \u201cThe best sites are effective at this. But there is a large range in the level of information that sites provide.\u201d
Dalbar has long monitored the metamorphosis of the financial services industry on the Internet and it closely tracks and researches industry Web sites. Thus, it has good basis for comparison.
\u201cFor instance, while some sites provide advisors with the selling points of each of the funds in their product line, assistance with composing prospecting letters to send to clients and PowerPoint presentations that the advisor can use to sell the particular product, there are just as many sites that provide none of it,\u201d he says. \u201cThe reasons probably are manifold, from cost to the time necessary to produce these materials to bandwidth limits.\u201d
Pressure to improve Web sites has arisen as more advisors have become savvy Internet users. And many clients \u2014 often baby boomers who have become fairly sophisticated investors \u2014 now are comfortable with the technology. As a result, the expectations of VIP visitors to a company\u2019s site are rising.
McDonald says the most successful firms quickly realized that their online portals were becoming a vital sales and marketing link to advisors across Canada.
\u201cAdvisors and their assistants usually go to a fund company\u2019s site to get information on a particular client\u2019s account; to reprint a client\u2019s statement or tax receipt; or to research funds,\u201d says McDonald. \u201cCompanies are realizing there are both financial and goodwill benefits to providing that information.\u201d
While some fund manufacturers were slow off the mark, all now realize the importance of readily serving advisors \u2014 but with varying degrees of effort.
\u201cThere are still differences from site to site in the level of account information offered to advisors,\u201d McDonald says. \u201cSome only provide basic information, such as account balances and unit balances. Bigger firms, such as AIM [Funds Management Inc. <\/b>] or Mackenzie [Financial Corp.] <\/b>, will let advisors look at clients\u2019 systematic investment plans, change a client\u2019s address, change dividend options \u2014 things like that.\u201d
Fund sellers are also finding that advisors\u2019 assistants visit their sites as often as their bosses, so they are making it possible for support staff to handle many administrative tasks online.
MONEY GOES WHERE IT\u2019S EASY<\/b>
\u201cThere will always be a relationship between how easy it is to do business with a fund company and how much money an advisor sends to that firm,\u201d says McDonald. Making life easier for the rep and his staff should be a priority.
Dalbar (www.dalbarcanada.-com) <\/i> has noticed that the industry leaders have been using their sites to \u201cbecome true business partners\u201d with advisors. \u201cSites such as AIM\u2019s, Dynamic [Mutual Funds Ltd.] <\/b>\u2019s and Mackenzie\u2019s are offering downloadable software that will help design portfolios for the advisors\u2019 clients,\u201d McDonald says. \u201cThe software suggests funds for the client to invest in and an asset mix, and will prepare a formal proposal for the advisor to take to his or her client.
\u201cWe\u2019ve talked to the companies that offer these tools,\u201d he adds. \u201cAnd, for the most part, they\u2019re quite pleased with the traffic the software is getting and the number of advisors that have downloaded the software to use on their own systems. While I wouldn\u2019t call that a \u2018must have\u2019 right now, I think it will be soon.\u201d
In the future, fund-selling sites will have to work even harder to solidify links with advisors and their staff and clients by offering more in-depth fund information and greater interaction.
@page_break@Fund companies also must acknowledge the competition and that periods of lacklustre performance may occur more frequently.
\u201cMany companies are slow to allow users to compare the funds in their lineup to third-party, objective benchmarks,\u201d says McDonald. \u201cIt is rare to see a company publish the Morningstar [Canada] <\/b> ratings for its funds, or the performance of its funds alongside the performance of its funds\u2019 benchmarks.
\u201cThat\u2019s understandable,\u201d he adds. \u201cIt takes fortitude to publicize the fact that your funds are underperforming their benchmarks or earning less than funds with stellar Morningstar ratings.\u201d
The fund companies must also ensure product information is readily available through the growing number of new technologies that will soon be commonplace.
\u201cAdvisors want to know immediately about market recaps, earnings releases and interest rate hikes.\u201d McDonald says. \u201cCompanies should start delivering that information as sound bites to advisors\u2019 PDAs, e-mail inboxes and \u2014 when podcasts go wireless \u2014 those, too.\u201d
For fund sellers, the future is about using every available technology to become more closely linked to advisors and their staff. Savvy fund companies will want to become indispensable by providing everything advisors want.\tIE<\/b>
If you have Web sites to share with IE readers, e-mail Glenn Flanagan at gflanagan@sympatico.ca. <\/i>
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