TechnologyMay 23 2023

Advice firms embracing tech generate 54% more revenue

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Advice firms embracing tech generate 54% more revenue

Advisers who embrace technology within their firm generate 54 per cent more revenue per adviser, according to data compiled by Intelliflo.

The Intelliflo eAdviser Index is compiled each year using data gathered by the company's Intelliflo Office practice management software which is used by 46 per cent of the UK adviser market.

As part of the process, Intelliflo breaks down advisers into four cohorts based on their level of technology adoption: explorers, adopters, embracers and champions.

This year’s index showed champions, the highest adopters, generated 54 per cent more revenue per adviser than the lowest adopters. This is an increase on the previous year’s figure of 44 per cent.

They also generated 76 per cent more ongoing revenue per adviser than explorers, the lowest adopters. The gap in assets under advice per adviser was 64 per cent.

Nick Eatock, Intelliflo's chief executive, said: "Tech-embracing advice firms continue to outperform their peers, displaying wider gaps in revenue, assets under advice, and clients per adviser.

"Year after year, the message is crystal clear: technology adoption is the make-or-break factor for firms seeking future success, cost-effective client service, and bridging the affordability advice gap. Streamlining processes through technology adoption becomes an essential competitive advantage at a time of rising costs and resource pressures driven by consumer duty."

The eAdviser Index analyses nearly four billion interactions within Intelliflo Office over the past year.

Intelliflo’s customer success team uses adoption models across six key areas of Intelliflo Office: activity management, valuations, income, Document Designer, Personal Finance Portal and data quality.

This allows them to identify the extent to which a firm is using technology. These models give each firm a score out of 100 in each of the five areas: zero means that adoption has not yet started and 100 indicates the technology is fully adopted and is being used effectively to a very high level. These scores are then combined to produce one overall score.

Eatock said: "Covid has accelerated the adoption of digitalisation throughout our lives so I suspect clients are more ready, willing and able to take those digital services. In many respects they expect it from their adviser and it becomes a self-fulfilling prophecy.

"The firms who are better adopters tend to have a technology mindset within someone at the top of that business, or they make sure there is someone who focuses on the technology."