AP: From pandemics to geopolitical conflicts, the past few years have changed the world drastically. How has this impacted the wealth management industry? And what should managers watch out for in the future?
AZ: Despite the economic disruption caused by the events of these past years, the future of wealth management continues to be promising. Nonetheless, wealth managers won’t be able to seize the available opportunities if they continue to conduct business as usual. Even before COVID-19, FinTechs changed the way people think about digital banking, and non-traditional players were applying for digital banking licences. The pandemic has altered the game even further, mainstreaming app-based transactions and digital relationships, and shifting consumer values.
There remains, of course, a large opportunity for wealth managers to deliver their services in an even more tailored way. This means making the right offering to the right client at the right time through the right channel. The proposition, advice, service needs to matter to the client and be personal – independent of the channel how it is being delivered.
“There remains, of course, a large opportunity for wealth managers to deliver their services in an even more tailored way. This means making the right offering to the right client at the right time through the right channel”
Ultra-high net worth individuals will be able to interact with relationship managers at the current levels – and some may still prefer digital or virtual interactions, especially as intergenerational wealth transfer progresses. For example, high-net-worth clients may continue to want to speak with a trusted advisor. But in a post-pandemic world, these relationships may shift to large parts to phone or video-based interactions rather than face-to-face meetings, reducing the need for office space.
Wealth managers should ask themselves how they can create an even better client experience in the hybrid business model, at scale, while remaining flexible to embrace future change. Digital enablement and smart use of data can help relationship managers deliver a far more tailored and personal service model to their clients, and simultaneously address the sustainability and automation of their own operating model. They also need to be aware of how to best utilize different channels seamlessly to optimize interactions. The goal should for relationship managers to be able to spend even more time with the right clients.
Wealth managers should also try to know their customers better beyond pure demographics and assets. They need to understand why customers are behaving in a certain way, how customers make decisions, how they trust, where they are in their lifecycle, what drives them, what their personal and financial goals are.
“Wealth managers should also try to know their customers better beyond pure demographics and assets – it is not just the WHO that matters, it is also the WHY”