The 2017 Software Survey, co-sponsored by Advisor Perspectives, Inside Information and the T3 conference, is available. On behalf of the sponsors, I want to thank the 1,064 professionals who provided us with useable responses, telling us not only what you used but also your rankings of each software tool on a scale from 1-10.
What did we learn? The final survey was broken out into categories, starting with CRM, which many regard as the hub of the technology stack. Few would be surprised that Redtail (24.11% of the respondents) and Junxure (20.72%) were the runaway market-share leaders, but a surprising 24% of the respondents did not report using any CRM tool at all. With one exception (Advisors Assistant, which had a ranking of 5.20) users were generally satisfied with their choice; the overall average user ranking was 7.04 on a scale of 1-10, with the highest ranking achieved by Concenter XLR8 (8.19), a SalesForce overlay that customizes the generic institutional CRM to advisory firms.
When the results were broken down by firm size, business model and advisor experience, it became clear that Redtail – the least expensive CRM option – was the runaway market leader among dually-registered and state-registered advisory firms, while Junxure, which is more complex and feature-rich, owned the largest market share among firms that self-identified as “asset managers” and “comprehensive wealth managers.” Firms with over $4 million in revenues preferred Junxure and the generic institutional CRM SalesForce. SalesForce, however, collected a relatively low user rating (6.95) while the customized SalesForce overlay, XLR8 from Concenter Services, reported the highest user rating (8.19).
In the portfolio management space, Schwab PortfolioCenter (used by 24.48% of the respondents) and Morningstar Office (21.75%) were the clear leaders, ahead of the multi-function rebalancing, CRM and trading platform provided by Envestnet/Tamarac (13.09%). Orion Advisor Services, a large outsource provider, came in fourth (9.70%) and Albridge, which is primarily an account aggregation and performance reporting tool, finished a hair behind (9.60%).
Users were not totally satisfied with their options in this category; the overall rating was just 6.59, and market leader PortfolioCenter received a 6.76 average user rating. Those who used Addepar’s primarily large-firm solution (7.75) and relative newcomer AssetBook (7.65) were the most satisfied customers of their portfolio management software.
But which of these products would best fit a firm of your size and makeup? Tamarac users tended to be larger, more established firms; the program earned a 29.57% market share among firms with more than $4 million in overall revenue and 21.29% of firms that self-identified as comprehensive wealth managers. Orion also picked up market share as firm size grew, and also as advisors reported more experience in the business. Morningstar Office was the runaway market leader among the smallest firms.
Among financial planning tools, the market share leaders were the goals-oriented MoneyGuidePro solution (41.81%) and the cash-flow-based eMoney (25.61%) were satisfying their users, who gave them a 7.86 and 7.89 overall rating, respectively. MoneyTree, one of the oldest programs in the ranking, finished a surprisingly distant third in the market-share rankings, used by 7.91% of the respondents.
Interestingly, eMoney pulled nearly even with MoneyGuidePro among advisory firms with more than $4 million in revenue (32.17% vs. 34.78%), while Advizr and Right Capital, both marketed to Millennial clients, are competitive among smaller firms and the youngest advisors; those with 1-5 years of experience.
The financial planning category was also notable in that very nearly 100% of the respondents reported using one of the programs. In past surveys, as many as 20% of individuals self-identifying as financial planners reported not using any financial planning software.
Only 25.74% of the total respondent population were using software in the next category – document management tools – but the average user ranking was 7.56 for the category as a whole, suggesting that those who are using DocuSign for client e-signatures (27.12%), LaserApp for forms (19.19%), and Laserfiche for paperless document storage and retrieval (7.75%) are getting good value for their investment. (The numbers are skewed by the fact that most of those who are using document management tools use at least two and more often three tools.)
Utilization was surprisingly uniform across firm sizes, except for Worldox, a document management solution whose market share is almost exclusively firms with more than $4 million in revenues. Worldox had a 20.87% share among the largest firms, but just a 0.50% share among the smallest.
Not surprisingly, the investment analytics category was dominated by Morningstar, whose 58.49% market share dwarfed its next competitor: YCharts at 6.46%. Here again, advisors report getting good value, giving their software an average 7.47 user ranking.
In the trading/rebalancing category, Envestnet/Tamarac (13.94% of respondents) and TD Ameritrade Institutional’s free version of iRebal (12.05%) were market leaders, although here again, the dominant leader was “none of the above,” with only 40.96% of users reporting that they use any of the programs. Users were most satisfied with the free iRebal version (7.70) and the more feature-rich standalone iRebal version (7.50).
Just 45.39% of the respondents are using a client portal tool to provide white-labeled information in client vaults. eMoney (22.60%) was the runaway market share leader.
Among risk tolerance assessment tools, Riskalyze (25.80%) and Finametrica (20.72%) were the runaway market-share leaders, but here again, the utilization rate was low: 53.87%.
The online client data gathering tools recorded the lowest utilization rate: 28.25%. PreciseFP, which provides customizable forms for advisors to give to prospects to fill out, and automatically integrates the data into many CRM, financial planning and portfolio management solutions, captured a 12.05% share of the respondents.
Perhaps not surprisingly, the market-share leaders (with the notable exception of PortfolioCenter) tended to have higher-than-average user ratings, which suggests a degree of stability and safety to advisors who are pondering a switch from an older system.
If you download the full report, you will see a full list of responses in each category that were provided in an “other” field, showing some of the less well-known solutions that small numbers of advisors utilize. You’ll find programs like Less Annoying CRM, Grendel, Captools, nDex Systems, Cheshire, TRAK, Egnyte, Cabinet NG and Kwanti/Portfolio Lab.
Bob Veres' Inside Information service is the best practice management, marketing, client service resource for financial services professionals. Check out his blog at: www.bobveres.com. Or check out his Insider's Forum Conference (for 2017 in Nashville) at www.insidersforum.com.
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The 2017 Software Survey, co-sponsored by Advisor Perspectives, Inside Information and the T3 conference, is available. On behalf of the sponsors, I want to thank the 1,064 professionals who provided us with useable responses, telling us not only what you used but also your rankings of each software tool on a scale from 1-10.
