The New Digital Thundering Herd

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We often hear advice to avoid herd mentality, but when it comes to Merrill Lynch’s approach to technology and wealth management, it’s time to follow the thundering herd.

Some 85% of Merrill Lynch’s clients in its 10 million plus cohort are digital adopters. That number may raise a few eyebrows. What does it mean to be a digital adopter? Could baby boomers really be embracing digital options? Surely the digital move must be led by millennials, or even those with fewer assets and less cumbersome needs.

Believe it or not, that’s not the case.

Kabir Sethi, head of digital wealth management for Merrill Lynch and Bank of America Private Bank, says that digital adoption has been closely correlated with the amount of assets the clients have with the firm. Both post and pre-Covid-19, digital adoption was highest among ultra-high-net-worth baby boomers, defying the misconceptions that millennials are leading the demand for digital options.

“At first blush, that’s a bit counterintuitive because you feel like people in that cohort don’t really do stuff themselves,” Sethi says. But that assumption may show us how our preconceived notions about technology in wealth management needs to change. As an industry, we often think that digital and self-service are interchangeable concepts, Sethi says. That is not always the case.

Self-service is an important and attractive part of a digital offering. Clients do like using the apps and websites to check their balances or trade. But this is not just about giving them their own power. “There’s an increasing appetite for collaboration,” says Sethi. Investors like having the option of walking through their portfolio with their advisor to get real time feedback. “It’s just a much easier experience, and, frankly, a lot more secure,” says Sethi. With the help of