On line demand for financial advice grows, especially from older high net worth individuals, research shows

Written by Ray Clancy

Monday, 21 June 2010 09:47

On line demand for financial advice in the UK is increasing but most independent financial advisers are missing the chance to capture leads, it is claimed.

There were over 50,000 searches for the term ‘IFA’ alone in the first quarter of 2010, according to research by search engine Google. It shows that more affluent searchers and older people are leading the search surge as daily internet usage in the UK is increasing year on year by 22%.

Searches on financial related terms are growing consistently and increased 19% year on year in 2009 as users embraced the internet as a medium for their financial research. With 30% of adult internet users earning household income of more than £50,000 this is a market IFAs should be aiming to capture, Google says.

Financial advice searches have grown strongly in the last 18 months, the report shows. The search term ‘unbiased financial advice’ had 84% more queries in February 2010 than in February 2008.

It points out that as the internet becomes an integral and even primary component of financial planning, companies with a strong online presence offering products or advice are benefiting hugely from the growing demand, whilst those who continue to rely solely on traditional sources of leads such as word of mouth and directories risk falling behind.

Wealth management is a big opportunity for IFAs online. Despite scepticism amongst many IFAs that older, high net worth (HNW) individuals use the internet as part of their financial research, studies indicate that HNWs do increasingly use the internet and are using search as an alternative research tool for managing their wealth.

‘This market represents a real opportunity for financial planners online because queries in this sector have grown strongly over the last few years yet the lack of advertising by IFAs to this market means that they are missing out on valuable leads,’ said Ian Morgan, Head of Finance at Google UK.

Whilst query volumes have increased, the majority of IFAs have failed to step up their internet presence either through maintaining a healthy website or through promoting themselves with online advertising.

‘It is vital for IFAs not only to have a good website, but to use all means possible to drive potential leads to find that website. Many IFAs are failing on one or both of these steps, meaning that online consumers are not finding them. IFAs are missing out on business, as potential customers are forced to look to other online sources of advice which are only a click away,’ the report says.

In recent years and with shaken consumer confidence in traditional financial establishments, many new online businesses have become popular sources of advice, with comparison sites like Moneysupermarket.com and forums such as Moneysavingexpert.com benefiting from the preference for independent online advice and information, it adds.

‘It’s great news that consumers of all demographics are taking control of their personal finances. Because the internet is now part of people’s lives, it’s not surprising that they increasingly use search to find financial help and advice,’ said Philip Calvert, founder of IFA Life and an Internet marketing expert for IFAs.

‘But IFAs are missing out on a wealth of opportunity online and risk becoming increasingly sidelined in the online world if consumers cannot find them in searches,’ he added.

IFAs who have embraced the internet are seeing positive results. ‘It's unimaginable that any IFA firm could even survive today without the internet. It’s now an essential part of our lives and the lives of our clients, so it's vital that we keep on top of all the different ways that it can be used and build value in our business whilst adding value to clients. I also recommend that every IFA puts time aside regularly to get trained on internet marketing,’ said Tina Weeks, owner of Serenity Financial Planning in North London.