It has proved easier for providers to build an effective online and mobile presence for new products, especially for direct-to-consumer products. It may be some time before all providers are able to offer mobile access for their long-standing and legacy products.
Regulatory changes, such as RDR are driving innovation in service. In particular charges are becoming more transparent with the emergence of clean and super clean share classes. Customers now expect easy access to information about charges online. Over time it is likely that this trend will drive down charges. This will make it far easier for advisers to compare charging structures and separate genuinely low-cost products from those that only appear to offer competitive pricing.
It will be interesting to see whether ‘pension freedom’ will drive further innovation in customer service. Advisers will have the opportunity to demonstrate how genuine independent advice provides benefits to their clients over and above that available through the government’s free ‘pension guidance’ proposals. We are also likely to see online technology being used to put ‘controls’ in place to ensure that clients understand and acknowledge the risks and benefits that ‘pension freedom’ entails.
Other developments in service have been moves by providers to engage directly with customers. The old ‘sign-up and forget’ model has been replaced with a ‘sign-up and remember’. Direct communication by providers with customers with news and ideas is now more the norm, backed up by appropriate social media engagement. Advisers can also capitalise on this trend, by engaging with their clients through social media and email when they have something worthwhile to say. The key is to strike the right balance between effective communication and bombarding clients with unwanted communication. Some providers and advisers have got the balance just right and are reaping the rewards.
Increasing engagement with customers is also changing the way that providers work with their third-party administrators to deliver product administration. The old model of setting targets based on speed of response or volume of calls handled is giving way to a new model where ‘softer’ customer engagement performance measures (such as first-time call resolution and quality measures) are part of service level agreements. The best third-party administrators are already meeting these requirements.
Over the last 12 months, service has moved ever more centre-stage with the emphasis now on ‘trying to delight customers’ through excellent service. At one level providers’ greater engagement with clients could be seen as a threat to advisers. Looked at another way, it could be seen as an opportunity; advisers want to recommend products that will ‘delight’ their customers. By recommending best in breed providers for customer service, advisers will be able to spend more time delivering high quality advice to their clients, rather than sorting out product administration issues.
