40% Faster Next-Gen Onboarding With Digital Engagement Platform

40% Faster Next-Gen Onboarding With Digital Engagement Platform

Executive Summary

Cornerstone Wealth Management faced growing challenges onboarding younger, digitally native clients using traditional paper-based methods, leading to frustration and potential client attrition. To combat this, they implemented a comprehensive digital engagement platform powered by Envestnet Yodlee, offering interactive onboarding workflows, mobile access, and customized educational resources. As a result, Cornerstone slashed onboarding time for next-generation clients by 40% and improved early client retention (within the first 90 days) by 12%, strengthening its appeal to a crucial demographic.

The Challenge

Cornerstone Wealth Management, a thriving RIA managing over $750 million in assets, recognized a critical shift in its client base. While their established clientele remained loyal, attracting and retaining the next generation of investors—children and grandchildren of existing clients, as well as young professionals—proved increasingly difficult. Their traditional onboarding process, heavily reliant on physical paperwork and in-person meetings, was perceived as cumbersome and time-consuming by this digitally savvy demographic.

Specifically, the average onboarding process for a new client under 40 took approximately 10 business days, from initial contact to the completion of all required documentation and account setup. This involved multiple email exchanges, printed forms requiring signatures and notarization, and scheduling phone calls to clarify information. The antiquated process led to a perceived lack of responsiveness, with some prospects citing alternative, more streamlined digital wealth management options.

Data revealed that 15% of prospective next-generation clients abandoned the onboarding process before fully completing it, representing a potential loss of over $3 million in investable assets annually. Furthermore, clients who did complete the traditional onboarding process showed a slightly higher attrition rate within the first 90 days (8%) compared to older clients (5%). This early attrition, attributed to a disconnect in communication style and a perceived lack of engagement, highlighted the need for a more modern, digitally-driven approach. This was especially concerning considering that the average initial investment for this demographic was $50,000, which could easily grow to $250,000+ over time with consistent contributions and market gains. Cornerstone knew it needed to adapt or risk losing a vital segment of their potential client base.

The Approach

Cornerstone's leadership team embarked on a comprehensive evaluation of digital engagement platforms, prioritizing solutions that offered a seamless, mobile-first experience, robust integration capabilities, and customizable educational content. Their decision-making framework centered on three key pillars:

1. Client Experience: The platform needed to provide a user-friendly, intuitive interface that simplified the onboarding process. Interactive workflows, digital signatures, and readily available support were crucial elements.

2. Efficiency Gains: The goal was to significantly reduce the time and resources required for onboarding, allowing advisors to focus on building relationships and providing personalized advice. Automated workflows and streamlined data collection were essential.

3. Integration Capabilities: The platform needed to seamlessly integrate with Cornerstone's existing technology stack, including their CRM (CornerstoneConnect, a custom-built CRM), portfolio management system (Black Diamond), and compliance software (Orion). This would ensure data consistency and eliminate manual data entry.

After a thorough evaluation of several vendors, Cornerstone selected a solution powered by Envestnet Yodlee. This platform offered a white-labeled mobile app, interactive onboarding modules with embedded educational videos, and secure document upload capabilities. Cornerstone worked closely with Envestnet Yodlee's implementation team to customize the platform to align with their branding and compliance requirements.

Crucially, Cornerstone didn't just implement the technology; they also revamped their onboarding strategy. They developed a series of short, engaging videos tailored to younger investors, covering topics such as the basics of investing, asset allocation, and retirement planning. These videos were integrated directly into the onboarding workflow, providing clients with immediate access to valuable information and building trust from the outset. Advisors were also trained on how to use the platform effectively and how to leverage its features to enhance client communication.

Technical Implementation

The implementation of the digital engagement platform involved several key technical steps and integrations:

• API Integration: The platform was integrated with CornerstoneConnect CRM and Black Diamond portfolio management system via secure APIs. This enabled automated data synchronization between the systems, ensuring that client information was always up-to-date and eliminating the need for manual data entry. For example, when a new client completed the digital onboarding process, their information was automatically populated in both the CRM and the portfolio management system. This cut down on administrative overhead and reduced the risk of errors.

• Secure Document Management: The platform utilized secure document storage and encryption to protect sensitive client information. Clients could securely upload required documents, such as driver's licenses and social security cards, directly through the mobile app. The platform also supported digital signatures, eliminating the need for physical paperwork and streamlining the approval process.

• Workflow Automation: The onboarding process was automated using a series of pre-defined workflows. These workflows guided clients through each step of the process, from completing questionnaires to signing agreements. Automated reminders and notifications were sent to clients to ensure timely completion of each task. This was especially useful for tasks like Required Minimum Distributions (RMDs) and other time-sensitive processes.

• Data Security: The platform was SOC 2 compliant and adhered to industry best practices for data security. Regular security audits and penetration testing were conducted to identify and address any potential vulnerabilities. All data was encrypted both in transit and at rest. This gave clients peace of mind knowing their financial information was protected.

• Performance Monitoring: Key performance indicators (KPIs) were tracked to monitor the effectiveness of the platform. These KPIs included onboarding time, completion rates, client satisfaction scores, and early retention rates. This data was used to identify areas for improvement and to optimize the platform for maximum performance. The calculation for onboarding time reduction was: ((Old Average Onboarding Time - New Average Onboarding Time) / Old Average Onboarding Time) * 100. Early retention was calculated as the percentage of new clients who remained active after 90 days.

Results & ROI

The implementation of the digital engagement platform yielded significant improvements in onboarding efficiency and client retention:

• Onboarding Time Reduction: The average onboarding time for next-generation clients decreased from 10 business days to 6 business days, a 40% reduction. This freed up advisors' time to focus on building relationships and providing personalized advice.

• Improved Early Retention: The early retention rate (within the first 90 days) for next-generation clients increased from 92% to 98%, a 12% improvement. This indicates that the improved onboarding experience led to increased client satisfaction and loyalty. This translates directly into reduced acquisition costs and increased long-term revenue.

• Increased Client Satisfaction: Client satisfaction scores, measured through post-onboarding surveys, increased by 15%. Clients consistently praised the platform's ease of use, convenience, and informative content.

• Cost Savings: The automation of the onboarding process resulted in significant cost savings. Reduced paperwork, fewer manual tasks, and increased advisor efficiency translated to an estimated annual savings of $25,000. This was calculated by factoring in reduced administrative staff time and paper/printing costs.

• Increased AUM: Due to the improved onboarding process and increased retention, Cornerstone saw a 10% increase in AUM from next-generation clients in the first year after implementation. This represented an additional $7.5 million in assets under management.

Key Takeaways

1. Embrace Digital Transformation: Modernize your onboarding process to cater to the preferences of younger, digitally native clients. Invest in a platform that offers a seamless, mobile-first experience.

2. Personalize the Experience: Tailor your onboarding process to the individual needs and preferences of each client. Offer customized educational content and personalized communication.

3. Integrate Your Technology: Ensure that your digital engagement platform integrates seamlessly with your existing technology stack. This will streamline your workflows and improve data consistency.

4. Track Key Metrics: Monitor the effectiveness of your onboarding process by tracking key performance indicators such as onboarding time, completion rates, and client satisfaction scores. Use this data to identify areas for improvement.

5. Training Is Essential: Ensure that your advisors receive adequate training to use the new digital platform and tailor their conversations to better engage the younger demographic.

About Golden Door Asset

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