Financial Planning - March 2011

worldwIde revenue
from mobIle apps wIll
trIple thIs year to

$15.1 source: gartner

billion

Advisors are moving away from the BlackBerry to the operating systems with the best selection of apps, and that often means the iPhone and Android. Gartner, a technology consulting firm, forecasts that worldwide revenue from mobile apps will triple this year to $15.1 billion.

To stay connected with clients and prospects, advisors will need to have their app on the devices their clients and prospects use. Custodians and software providers to advisors have taken notice. Many have already released iPhone and Android apps, and many more such apps are under development.

Tablet PCs, with their larger screen and more robust processing capabilities, should have an even larger impact on our business. When Financial Planning surveyed advisors last fall, 17% of respondents said they already had an iPad, and another 31% said they planned to buy one soon. Seven percent already owned a tablet other than an iPad, and another 9% plan to buy one soon.

The sale of non-iPad tablets, specifically Android tablets, likely will expand even more rapidly. At the recent Consumer Electronics Show in Las Vegas, a diverse set of manufacturers were showcasing a variety of Android tablets. By the time you read this, Motorola probably will have launched its much anticipated Xoom tablet powered by Android.

Over the next several months, manufacturers will be launching Android-powered systems with screens ranging from seven inches to 11 inches or larger. We expect many Android tablets to retail for significantly less than the iPad, which should speed adoption among both consumers and advisors alike.

What are the implications for your practice? Clients and
prospects are already accessing your website using smart-
Some firms are already replacing paper
reports with reports on tablets at client meet-
ings. These digital reports can contain more
striking graphics and supplementary audio and
visual content. They also allow you to explore
alternatives interactively in real time.

BUDGETING FOR TECHNOLOGY

Spending by advisory firms on technology varies greatly. The 2009 and 2010 Financial Planning Technology Surveys have indicated that roughly half of all advisory firms spend 5% or less of revenues on technology. Another 40% spend between 6% and 10% of revenues on technology.

Does this mean that the latter group always gets superior results to those that spend less? Not necessarily. The gross numbers only tell part of the story. It’s not just how much you spend on technology, it’s how you spend it.

According to the 2010 Financial Planning survey, 81% of respondents didn’t have a written technology plan, and 94% didn’t analyze the return on investment (ROI) of their technology purchases. If your firm is one of that majority, make it a priority to change.

According to a 2010 Schwab whitepaper, Integrating Technology into Your Practice, firms that report being early adapters and view technology as “central” to their practice or “ critical to their business” say they benefit the most from their

If you have not checked to see what your websIte looks lIke on a tablet
or smartphone from the leadIng manufacturers, now Is the tIme.

phones and tablets. If you have not checked to see what your website looks like on a smartphone or tablet from leading manufacturers, now is the time.

Some of you will need to make immediate changes. You also need to check with your vendors to find out if they are offering, or plan to offer, their own apps for your phone and tablet. A well designed app should give you quick and easy access to the data you’ll most likely need when out of the office.

You might also want to determine what type of phones and tablets your clients are purchasing so that you can cater to their specific needs. It is not too early to consider providing your own iPad and Android apps for your clients. That means your icon sits prominently on their tablet and phone, and it will be where they go first for their financial needs.

technology investment. These strategic spenders spend only 2.4% of their revenues on technology versus 5% for the top spenders in the survey, yet the strategic spenders generate twice the operating income.

This may sound counterintuitive, but it focuses on a basic point: If you want the most bang for your technology buck, think strategically, create a plan and measure results. Improved integration and new mobility tools hold out the promise of a much brighter future, but advisors must do their part. FP

Joel P. Bruckenstein, CFP, is an international expert in applied technology and co-producer of the annual T3 Technology Conference for financial advisors. For more, visit www.technologytoolsfortoday.com/.