Roy Keenan from Yarra Capital Management shares insights with James Dunn from The Inside Network on the role of active management. The Inside Adviser
After the Hayne Royal Commission many advisers decided to steer away from large dealer groups in favour of becoming self-licensed. In the last six months, however, that trend has taken an abrupt turn.
AI will reimagine advice marketing and client relationships more than investment: Netwealth
Nearly half the advice firms who participated in a 2023 survey by the fintech Netwealth are AI “interested”, Andrew Braun told delegates at the 2024 SMSF Association National Conference in Brisbane.
Braun, who is Netwealth’s general manager of marketing, said that figure dropped to 11 per cent when asked whether they were actively using AI in their businesses, with another 34 per cent exploring how they could use it and what benefits it could deliver their advice firms.
“What we found very interesting – and somewhat surprising – from the survey was the areas where they thought AI would have the biggest impact on their businesses.
“Contrary to what I would have thought, we found that seven out of 10 advisers thought that it could impact their marketing, such as content marketing or digital advertising, while six out of 10 thought it could impact their client-related activities, such as customer service. There was a smaller focus on areas such as portfolio management, compliance, and security.
The benefits of AI can potentially be more widespread, Braun continued, with Netwealth’s research showing there are about 40 different ways where it can assist an advice business.
“Take client relationships, for example. When we think about the client experience, what we’re dealing with now is someone who expects instant gratification, and for responses to be hyper-personalised,” he said.
“What we have via AI are tools that can make you more proactive in what you offer and less reactive. Imagine if you could look at a client’s emails and social media before a meeting. Using AI, you can come up with a smorgasbord of things that you can talk to a client about, whether that’s an investment idea, a life event, or a simple administrative issue.”
He cited the example of the financial behemoth Morgan Stanley that has created such a tool for its advisers. “Here’s how it might work. Assume the market has been volatile and is down 4.1 per cent in one day. Every adviser would have an AI-generated email sent to clients along these lines: ‘You might be wondering what this means for your portfolio. Although the S&P declined by 4.1 per cent, your portfolio was only down 2.4 per cent due to how it’s diversified’.
“Anyone who creates portfolios or sits on an investment committee knows just how much data and research is used. What AI is allowing to happen is not just access to this data, to this research, but different ways of understanding what it all means and how that can impact on your clients.”
Another potential use of AI are “behavioural nudges” where you basically try to help educate clients to make better decisions. “It might tell them when they’ve got too many subscriptions, and perhaps they should close one. Or it might be positive note saying they’ve saved more money than they thought so perhaps they should consider a higher interest-bearing account.”
On the organisational front, Braun explains how AI can be effectively used to resolve appointment clashes. “Quite simply, it allows you to catch up on a meeting after it has finished, highlighting content that was shared, notifying you of any action items emanating from the meeting, or a specific client discussion,” he said.
“If you want to learn more, you can ask clarifying questions to get a more detailed response. It can tell you why a certain decision was made, giving you helpful context. It can even detail whether other solutions were considered, and why the meeting reached the conclusion it did. It can be a huge time saver.”
