MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Tuesday, January 18, 2000 High Performing Advisors Taking Cyber-Route to Top (Part I) Jonathan Bentley formed LightPort.com in 1997 after a 15 year career as a securities broker, financial planner, and independent money manager. Imagine the benefits of answering an important client's question, in detail, within hours of its e-mail arrival. Or the advantage of transmitting financial plans online, giving both you and your customer the ability to make fast and easy edits, thus expediting the portfolio management process and making your clients feel like they have a more direct role in their financial affairs.
Well, a growing number of large financial advisors have stopped imagining such a scenario and have taken steps to bring those images to life. How? Through the creation of their own advisory Web sites. Web sites are viewed by more and more big advisory firms as a critical, powerful tool to compete in the new cyber age. Investors are already used to the idea. According to NFO Worldwide, A Greenwich, Conn. financial research firm, reports that 20 million U.S. households use the Internet to obtain investment news and idea, and 6.3 million have online portfolio accounts. After all, if your clients aren't getting the investment information they want from you, what's stopping them from getting it somewhere else online? While that's not likely with the more affluent Americans who are accustomed to delegating their investment responsibilities to professional financial advisors, why take a chance? Just ask Scott Kays, principal and founder of Atlanta-based Kays Financial Advisory Corporation. His firm has had its web site up and running since April, 1999. "The second worst thing an advisor can hear these days is that a client is "checking out" a competitor's web site," says Kays. "And the first is the client is leaving you for that competitor because you don't have one." Even advisors who haven't rolled out web sites yet are feeling the heat from customers to do so. "Clients are disappointed when I tell them I don't have a web site, even though I don't want one because I have all the business I can handle," offers Susan Kaplan, president of Wellesley, Mass.-based Kaplan Financial Services. "So I may be forced to build (a web site) just to satisfy my current customers' thirst for using the Internet." Of course, that doesn't mean rushing headlong into a web site campaign that sacrifices quality for speed. That's especially true for financial advisors with large client bases. Obviously, with more customers to interact with, a web site may even be a more valuable tool to a larger financial planner than a smaller one, since there is a greater opportunity to communicate with more clients faster with your own web site. "The web is billed as the great common denominator for smaller companies," notes Kays. "But the truth is that larger advisories will enjoy greater benefits from the web than smaller ones, simply because of the ability to communicate with a larger group of clients interactively." Farming it Out: The Outsourcing Issue Buoyed by the notion of happier clients and reduced mailing budgets, more and more financial advisors today are setting up shop on the Internet. Using the Web is nothing new for planners -- according to Austin, Tex.-based Amicus Networks, 97 percent of advisors routinely use the Internet for e-mail and research purposes. But building and maintaining a web site is largely unnavigated terrain for advisors, who naturally wonder where to begin. "I think you have to first decide if you want to build it yourself or have someone build it for you," says Laura Scroggins, president of New Pacific Advisors in Chico, California. Scroggins, who built her own web site back in early 1998. She says the care and maintenance of an advisory web site can be a drain on resources. "Look, every hour you spend updating your web site is an hour lost in helping clients manage their money," Scroggins explains. "It's like writing your own newsletter -- it's great to say you have one, but at what cost in terms of time and money?" Outsourcing your web site to a Internet advisor specialist firm like LightPort.com, which specializes in helping advisors who either have no experience building web sites or who have tried to build one with frustrating results, can make your life much easier. A good, high-quality outsourcing agent can provide you with the technology and services needed to create and launch your own site. "I'd say outsourcing it is the way to go," adds Kays, whose site is chock full of bells and whistles like online maps to his seminars and automated tax forms that can be e-mail to clients (or their accountants) at a moment's notice. "But choose a timeline you're comfortable with. We usually add new features to our site every quarter, because that's about all the attention I can give it." When you do begin considering web outsourcing specialists, stay away from those that embrace a cookie-cutter approach, no matter how much easier it may be on your budget. Advisors contacted for this article uniformly maintained that they really wanted a site that was tailored around their clients' individual desires and needs. "Even that costs less than you think," says Jim Denney, President of Schenectady, New York-based Mohawk Asset Management, which recently installed a LightPort "Virtual Office" in his practice. "But aiming higher never hurt us. And now that our LightPort site is up, I can see that taking a cheaper approach would have really hurt us." Part II will be posted on 1/19/99  Think Fundamentals Big Ideas The views presented in this article represent those of the author and do not necessarily represent those of InvestmentWires, Inc. InvestmentWires, Inc. does not guarantee the accuracy, completeness or timeliness of, or otherwise endorse, these views, opinions or recommendations, give investment advice, or advocate the purchase or sale of any security or investment. Printed from: MFWire.com/story.asp?s=25449 Copyright 2000, InvestmentWires, Inc. All Rights Reserved |