The wealth management landscape is constantly evolving. Today’s investors have high expectations, demanding anytime, anywhere access to accounts and information, while expecting frictionless speed of updates and requiring greater transparency.
To meet these increasing demands, wealth managers must stay informed and connected, while exercising critical time management to service their clients.
Technology needs to support and enable advisors to do their jobs more effectively. Firms must decide which technologies are necessary, and those which are not worth the investment that may be needed to master and deploy.
To better understand the real-life impact of these shifting industry trends on organizations as well as on individual advisors, we commissioned Forbes Insights to survey 200 wealth advisors and executives around the world.
Client acquisition and retention
Sixty-five percent of wealth managers spend most of their time on client acquisition and on-boarding. This is followed closely by providing advice, and client objectives and risk tolerance. Many wealth managers believe technology can aid efficiency in these tasks.
Regarding attracting and retaining clients, wealth managers see a combination of factors: the ability to provide advice beyond the portfolio, connecting with the next generation, and the use of digital tools for communication.
Advisors report that the advice they provide and the time they spend with clients play a major role in retention. They feel the pressure to constantly prove that they can add value by helping clients stay on track to reach their goals.
Automation can help advisors customize client outreach in less time, resulting in more time to spend where they can add the greatest value.
Advisors also said a top factor in retention is the ability to generate personalized outreach on events relevant to a client’s holdings. So is staying relevant to the next generation of investors; 69 percent of wealth managers indicated they are concerned about staying relevant to millennial investors.
What next for relationship building?
A large proportion of advisors — 72 percent — see artificial intelligence as an opportunity. No one sees it as a threat.
This is highly encouraging, as wealth managers see the advancements as an enabler to help with time sensitive, and time intensive activities rather than a disruptor. Forty-one percent believe that advanced analytics and cognitive technologies will have the greatest impact on the wealth management industry over the next three years.
Personalization becomes more complex in the age of digitalization — and something that millennials and many others take for granted.
Wealth managers need to use technology, data and digital tools to better understand and manage their clients’ unique needs and make the relationship personal on their clients’ terms.
In recent years, wealth management practices have concentrated investments in big data and advanced analytics.
This is particularly the case as a means to prioritize and analyze all data related to financial goals (demographics, weather, political risk as well as financial) and to analyze client data over time and in relation to other proprietary data.
They have focused on applying those findings to offer relevant products based on demographics and goals. In future, cognitive capabilities and advanced analytics to enhance decision making and portfolio management top the list for future investment.
The future of wealth management
The role of the wealth manager could change dramatically in the next few years. Not only do clients expect better tools of engagement, but advisors will be serving ever more clients and for lower fees.
They will need to “know” their clients with the same speed and precision of machine learning.
At the same time, wealth managers will need to constantly bridge the digital divide between their less tech-savvy clients and the digital natives who will control more of the world’s wealth in the decade to come.