Driving client engagement in investment management through responsible digital transformation


COVID-19–induced lockdowns have increased the need for investment management firms to change their communication and client engagement strategies. How can firms make the most of responsible digital transformation and drive client engagement?

June 23, 2021

An article by Kedar Pandit, investment management senior analyst, Deloitte Center for Financial Services, Deloitte Services LP.

Driving client engagement

COVID-19–induced lockdowns have brought about a change in investment managers’ communication and client engagement strategies. Firms have quickly pivoted to digital channels, and many will likely accelerate their push toward digital client interaction in the future to improve collaboration between advisers and clients,1 efficiency in sales and client service, and the number of client meetings held per day. However, this increased efficiency doesn’t guarantee better client engagement, as shown by a recent Deloitte survey of global investment managers. Even though most respondents reported that digital communication allowed for a greater number of sales meetings, some also reported a lower success ratio (see figure 1). Furthermore, overcommunication and delivery of irrelevant content to clients may end up doing more harm than good. So how can firms make the most of digital strategies without overwhelming clients? Responsible digital transformation that considers benefits as well as the perspectives of clients, management, employees, and shareholders may be the answer.


Figure 1. Impact of virtual client meetings on business generation and throughput for respondents

Source: Deloitte Center for Financial Services, 2020 survey of investment management firms (n=200)

Data analytics and personalization

Firms can use data analytics to personalize client communications, considering content, delivery mode, and frequency of interaction while respecting the privacy of clients. The insights so derived can help firms decide the amount and type of content to be produced, categorize clients by their interests, and plan deployment schedules. Firms can analyze the topics a client engages with the most to gauge the level of interest in specific asset classes and products. Such analysis can enable firms to provide clients with products of interest and tailored market insights. Clients typically appreciate the communication of these insights that help them make investment decisions, especially in volatile markets.2 Well-informed clients can reach a decision point faster, reducing advisers’ effort in closing a deal. The asset management arm of one global bank has been able to produce personalized interactions throughout the pandemic period, likely driving client engagement.3 This action, along with streamlining its sales teams, centralizing technology investments, and creating a timely advertisement campaign on volatility when others were pulling their ads, likely contributed to the fund manager’s successes in 2020.4

While personalized content is central to client engagement, the mode of delivery can be just as important. Some clients may like watching videos, some may prefer podcasts, and some others may simply like reading reports. Insights such as clickthrough and bounce rates on content emailed to clients can help firms identify a client’s preferred delivery medium, which, combined with clients’ topics of interest, can help create targeted lists for marketing campaigns. That said, firms should be mindful of client privacy while collecting and analyzing data.

Lastly, firms that analyze the frequency of client interaction with various content formats can gauge the amount of new content to be produced in each format and maintain an appropriate level of client outreach. Using analytics, some firms strive to match social media content publication with the frequency of client visits. This has helped some achieve engagement rates up to double that of financial services benchmarks for engagement.5

Coordinating across the operating model

Successful implementation of digital client engagement strategies may encompass coordinated changes across people, processes, and technology. These changes entail strategic choices made by leadership and clear assignment of the initiative’s ownership to track progress. Let’s look at some important aspects to consider when implementing digital initiatives responsibly.

First, firms can consider appointing a chief data officer (CDO) to drive data and technology initiatives top-down.6 The CDO can report into either the CIO or CTO and ensure data consolidation across departments, systems, and even third-party vendors. Such collaboration can be achieved by setting up cross-functional teams comprising marketing, sales, and IT professionals, and it may require buy-in from across the C-suite. While the C-suite designs the strategy, effective execution needs ground-level changes. Professionals may need to learn new skills and coordinate across functions. For example, marketing professionals may need to adapt processes where they drive the overall client engagement strategy, but the data analysis to support the strategy is performed through IT. Firms might organize training sessions to help transition professionals to this new way of working or consider setting up a board-level digital risk monitoring committee to mitigate any risks that may creep in due to digitalization.7 The committee can oversee matters related to cybersecurity, stress tests, and risk governance to ensure responsible adoption of technology. In short, digital client engagement initiatives will likely require a change in mindset and coordination throughout the organizational hierarchy.

Changes in talent may be accompanied by process modifications. Firms may have to decide which marketing activities to retain in-house and which ones to outsource. Firms that make these decisions responsibly consider factors such as internal capabilities, cost-effectiveness, and adequacy of governance processes.8 They may also review data security practices in the extended organization, including integration with third-party vendors, to secure client data and meet regulatory requirements.9 New control mechanisms to prevent identity theft and fraud may also be required. To address clients’ privacy concerns, firms may develop and communicate guidelines for ethical data usage. Clear and transparent privacy policies can assure clients that they are in charge of their data. Clients tend to be more open to sharing their data if they understand how the information will be used and the benefits they receive in return.10

Finally, firms looking to implement digital communication strategies may have to ramp up their technology investments. Clients are responding well to digital initiatives and are demanding more functionalities such as interactive reports and digital self-service.11 Technology is an area where firms may need to do more, considering that fewer than half of firms surveyed plan to increase their spend on digital channels (48%) and data analytics (46%) over the next year (see figure 2). Firms may also need to rethink their data infrastructure to store data in a clean, machine-readable manner. Cloud-based data warehouses can help aggregate data from diverse sources and process it in real time.12 This approach enables analytical capabilities that can be scaled as needed.13 Firms may also employ time series databases to track and analyze client data over a period of time to gauge changes in client preferences.14 Implementation of the right database and analytics technologies, backed by proper cybersecurity measures is an important element of the digital operating model. Frameworks such as zero trust can provide robust and resilient data security, as well as protection against attacks through vendor or third-party infrastructure.15


Figure 2. Even though clients are demanding more digital experiences, less than half of firms surveyed plan to increase their spending on digital channels and data analytics

Source: Deloitte Center for Financial Services, 2020 survey of investment management firms (n=200)

Digital client engagement strategies have now become more commonplace and have raised client expectations. Firms can cater to these evolving client demands through responsible digital transformation, and the resulting process efficiencies can benefit both employees and management. Moreover, clear privacy policies and ethical data usage guidelines will likely be appreciated by shareholders and regulators alike. Firms that adopt responsible digital transformation practices can satisfy these stakeholders and help them succeed.

What do you think?

Join the conversation on Twitter: @DeloitteFinSvcs.


1 Alyson Velati, “Wealth Mgmt Firms Plan to Forge Ahead with Tech Upgrades in 2021,” Fundfire, December 15, 2020.
2 Ed Moisson, “JPMorgan on course to be best-selling active firm this year,” Ignites Europe, December 3, 2020.
3 Ibid.
4 Julie Segal, “J.P. Morgan Won Active Management in 2020. Here’s How They Did It.” Institutional Investor, February 5, 2021.
5 Dervedia Thomas, “Managers Spruce Up Social Media to Stand Out,” Fundfire, September 21, 2020.
6 J. Tyler Cloherty, Jeffrey A. Levi, Benjamin F. Phillips, Chloe H. Rosenfeld, and Justin R. White, “Technology for the C-suite,” Deloitte, December 15, 2020.
7 Angel Vaccaro et al., “Beyond marketing: Experience reimagined,” Deloitte Insights, January 16, 2019.
8 Ibid.
9 Julie Bernard and Mark Nicholson, “Reshaping the cybersecurity landscape,” Deloitte Insights, July 24, 2020.
10 Timothy F. Cercelle and Omer Sohail, “Redesigning customer privacy programs to enable value exchange,” Deloitte Insights, November 9, 2020.
11 Alyson Velati, “Wealth Mgmt Firms Plan to Forge Ahead with Tech Upgrades in 2021.”
12 Christina Brodzik, Kristi Lamar, and Anjali Shaikh, Tech Trends 2021, Deloitte Insights, December 15, 2020.
13 Ibid.
14 Ibid.
15 Deborah Golden et al., “Zero trust: Never trust, always verify,” Deloitte Insights, 2020.

The views expressed in this article are those of the author and not official statements by Deloitte or any of its affiliates or member firms.

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