In a recent interview with this publication, Michael Diefenthaeler, director of product management at Interactive Data Managed Solutions, described how the new media landscape is affecting financial firms and advisors. In this article he explains how firms should look to implement a multi-channel strategy and how to overcome the related technical challenges.

In order to maximise success in a changing environment of communication channels, firms and advisors need to implement cohesive strategies to communicate with their clients and meet their expectations. However, in order for this to happen, firms will need to review their underlying technology to ensure a consistent approach across the different channels to deliver a positive customer experience.

Demand for multiple channels to provide investment decision support

As client behaviours have changed, firms must look to leverage the new opportunities that social and mobile channels present. User-friendly channels that offer intuitive functions and are accessible from anywhere significantly contribute to the client's perception of the financial institution as a trustworthy partner.

These channels include:

• Social media

Consumers have an increasing requirement for real-time information, and are commenting on industry trends in forums and blogs, as well as communicating with each other. This content increasingly influences their opinions and personal decisions as to whether to rely on a service or buy a product. The introduction of banking and near-banking services within social media, such as ICICI Bank, or First National Bank of South Africa and ASB Bank linking existing mobile customers to Facebook accounts for transaction services, complement existing channel offerings while also providing an opportunity to strengthen the client relationship. This channel can help build relationships with an emerging new client group consisting of “digital natives” who use social networks for interaction with peers.

• Mobile and tablet applications

Many of the applications currently available cannot do a great deal more than enable users to check their balance and find the closest ATM. There is an increasing demand for added value near-banking solutions, designed to help with portfolio allocation and risk within brokerage, statistics, customer consultation and sales functions.

Tablets can enable the advisor and client to view content together much more easily compared to switching between different applications and sources on a laptop. As the popularity of tablets has grown it has become an ideal presentation instrument due to its visual capabilities and integrated networking functions.

• Portals and personalised websites

Financial portals and websites can help provide greater transparency and effective networking. The combination of multiple internal and external data sources, functionality and analysis tools within a single financial dashboard tailored to an individual’s requirements can help advisors to increase efficiency in their role.

Users can easily construct personalised pages and investment proposals which can be automatically generated based on a selected investment strategy, model portfolio and customer-specific requirements.

Overcoming the technical implications of managing multi-channel delivery

The siloed nature of a bank’s numerous internal systems often hinders multi-channel management as old core systems have to be patched to ensure compatibility with new delivery mechanisms. Synchronising large volumes of data across many channels is technologically complex, time-consuming and therefore costly.

However, it is possible to deliver a multi-channel strategy that supports both growing data volumes and the various outlets for dissemination in a cost-effective manner. To make this a reality, firms need consistent data delivered in an efficient manner.

The basis for supplying consistent data and applications is an efficient service management hub. A centralised platform has the ability to gather, harmonise and save structured and unstructured market data from multiple sources, including market quotes, contributor data, master data, indices, news, macroeconomic data and research.

Market data can be integrated into the platform via a standardised data model, which allows for consistent processing across systems. It enables efficient searching across different sources and a bringing together of different kinds of data, regardless of the original source, for comparison, modeling and analysis.

This approach works for a simple reason: it separates the content that powers decision-making from the applications that display and manage this data. This significantly reduces the necessary source code and helps develop applications quickly and easily, independent of the chosen programming language and operating system platform on the user side. Consistent data can be delivered into different applications and channels, including Apple and Android apps or widgets for web pages.

The PaaS route

The “Platform as a Service” concept offers convenient access via the internet to hosting services comprising data collection, storage and delivery, as well as the provision and maintenance of the required technical infrastructure and the operating of business-critical customer applications. Additional software or local servers are not required, thereby reducing technology, maintenance and administration efforts.

With the data hub acting as a single source that can be extended out to multiple channels, firms can offer a wider variety of touch points to their clients. This is important as clients no longer want to use channels in parallel, or one after the other. There is a clear trend towards a combination of channels, driven by client demand.

Crucially, any actions taken in one channel are automatically updated across all of the other channels. So, for example, if a customer performs a reallocation within his portfolio via a mobile app, it is also reflected in their individual user section within a financial portal, or personalised homepage.

Making the most of the multi-channel opportunity

The benefits of an efficient multi-channel strategy are clear: market data costs can be reduced, customer service is enhanced, and the investment advisor’s job is simplified. The customer can be reached through a mix of their preferred channels and both can monitor the performance of their portfolios from anywhere and at anytime. While this undoubtedly represents a challenge to firms, there are also many possibilities for strengthening the client relationship.

By establishing a cost-effective multi-channelling strategy, based on lean structure and embedded internal sales and transaction processes, a company can build out a uniform brand identity, and is well placed to position itself in the new media landscape.

It is no longer a question of whether firms should look to a true multi-channel strategy but when they will implement one. Customers now have better, faster access to data, with availability irrespective of time and location. As demand for these services grows, those firms that fail to offer clients the opportunity to engage with them through the new channels and provide personalised services and apps will find themselves left behind those that do.