Never mind the robos… we’re all digital wealth managers now


One thing that C. Hoare and Co, the UK’s oldest private bank, and MoneyFarm, one of the new breed of digital wealth managers have in common is that they both launched mobile apps this year. Those who still think digital access is only an essential requirement for services aimed at the masses are starting to look painfully out of touch. The good news is fewer and fewer are falling into that category.

When C. Hoare & Co agreed to sell its wealth management arm to Cazenove last month, one of the reasons cited was the “new challenges of technology”. Offering a digital proposition to end clients when nearly everyone in Britain owns a smartphone is a universal requirement for wealth managers and it is no longer good enough to just offer a limited digital proposition as part of a premium service.

The online services for self-directed investors generally have more involvement with end investors than advised or discretionary propositions and we recently benchmarked how these propositions are evolving in the digital world. There are three key points to take away from the research that will increasingly apply to all wealth managers:

Digital transformation has become a top-level organisational priority

Nearly all the companies surveyed have made key hires to lead the digital side of their businesses of which 18 per cent are at board director level.

Mobile first

Mobile is the top digital development area over the next two years considered to be important by 100 per cent, closely followed by cyber security at 92 per cent.


With 92 per cent of propositions already offering mobile-optimised websites, phase one of the mobile digitalisation of DIY services is almost complete. However, when we dig a little deeper we find the current offerings vary wildly across the sector. The investor experience breaks down as they go deeper into the online services, with 70 per cent having optimised pages when logged into an account and only 40 per cent optimised on dealing pages.

A social media presence… not just for kids

Nearly all D2C propositions have a presence across Twitter and Facebook. Even WhatsApp and Snapchat get a look-in with some! Social media is seen as being particularly valuable for customer engagement, relationship building and customer service but less so for customer acquisition.

As Facebook used to say, “This journey is 1 per cent finished” and that undoubtedly applies to wealth management in the digital age. Changing consumer behaviour and advancing technology are driving the retail investment industry’s evolution.

Our media use has become more “social”, our access to the internet more “mobile” and consumers expect to transact digitally as well as informing themselves through online sources.

Some question the sustainability of the new breed of digital wealth manager but there is no doubting their ability to offer a beautiful user experience that matches what we have come to expect throughout our digital lives, whether shopping on Amazon or getting home with the help of Uber. In addition, they are starting to grow their assets and build recognition with investors. Nutmeg has brand recall among the British population of 8 per cent – still small compared with the likes of Hargreaves Lansdown at 30 per cent or St. James’s Place at 20 per cent but higher than for a number of well-established investing brands.

Most importantly, all wealth managers need to understand that “digital” is critical to offering a premium service. We see Hargreaves Lansdown investing a “seven-figure” sum into their next set of mobile apps, on the back of their mobile website visits overtaking desktop visits this summer. That suggests there will be a digital divide opening bet-ween the services with good
online propositions and those that are not prepared to invest.

Being “undisturbed by any process of change” was once written of C. Hoare and Co in a glowing tribute by John Maynard Keynes. For any wealth management company to have a conservative approach to digital investing today, could be considered to be reckless.