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The wealth management industry is facing two major tectonic shifts. First, the industry is facing the greatest inter-generational transfer of wealth in history from baby boomers to Generations X and Y. This reality presents two major strategic issues. On the one hand, how do wealth managers maintain the loyalty and assets of the boomers? On the other, how do they develop propositions of relevancy to the younger generations? Gen X and Gen Y have grown up in an environment where ubiquitous connectivity, collaboration and social media are deemed as essential as food and water and many traditional forms of interaction have been replaced with virtual communication.
Our research found that their digital mastery and appetite for wealth management services have not translated into confidence in managing their finances - so we did a research on how wealth managers can create digital experiences to better engage digital investors.
The research findings suggest that digital enabled wealth management experiences have the potential to:
· Deliver growth through greater customer engagement, satisfaction, advocacy and loyalty.
· Improve productivity through virtualization of specialist skills and expertise in mobile workforces.
· Create new personalized, context aware and predictive customer experiences through advanced digital interactions.
The research demonstrates a significant level of appeal for digitally enabled wealth management tools, including:
- Technological developments such as the use of video are seen as game changers as they can fundamentally improve the client experience, productivity and reach of advisers.
- The most popular concepts with digital investors were educational videos online (47%), alert services to track your investments or the market (44%) and online collaboration with an expert using chat, video or voice (38%).
- Almost three quarters (74%) of respondents said the digital experiences appealed when presented as a combination of five service concepts.
- More than one in two digital investors prefer smartphones (59%) and tablets (54%) to access these concepts, and;
- An overwhelming majority of four in five digital investors (80%) prefer the online channel to access these concepts, a third (31%) of which prefer to connect to them through social media.
Gen X and Y’s engagement in technology as a social investor
Having established the relentless shift of the Gen X and Y towards services that can be offered through them, we look at several major trends in how technology can be applied by financial services organizations to respond to that shift.
· Collaborative services are underpinned by technologies such as video calling, document collaboration, screen sharing and application sharing.
· The integration of the contact channels could help improve the productivity of their workforce, the quality of their customer information and the consistency of experience they provide for their clients.
· Global social networks like LinkedIn and Twitter are being used professionally while some companies have chosen to use privatized social platform for sharing professional information within the corporate and clients.
With the tools of above, Gen X and Y have been trained to expect services that understand who they are, could use all available information to understand the task they are trying to achieve, also adapt to enable them to achieve that goal as simply, quickly and efficiently as possible. They expect personalized, context-aware service delivery and this is predicated by information about the person being served and data regarding the context of that service.
Personalized, context aware, predictive digital interactions
By effectively employing information, media and communications technologies, wealth managers can choreograph customer experiences that meet these high expectations. In doing so, they can not only create engaging services, but can also extend their reach and substantially reduce the cost of interacting with customers.
Through this strategy, wealth managers and financial advisers have the opportunity to both grow their addressable market and capture a greater share of it. Creating digital ecosystems that embody personalization, collaboration, social media, context-awareness and predictive analytics are all important enablers for these interactions.
Their delivery can be orchestrated through modern cloud-delivered ICT such as unified communications, IP multichannel contact management, content management and distribution systems, and integrated messaging. Finally, the emerging future of virtual personal agents and intelligent personal assistants, can be seen as a logical extension to today’s offerings, and bring all of these technologies together through a single, unified and natural interface.
At the end of the day, these generations require a range of information services and advice and will increasingly aim to minimize face-to-face, time-consuming interactions where possible. However, wealth managers must continue to manage their customer relationships, or risk losing their business, so should utilize the contact made through a number of different channels – online investment reports, video advice, email, or social feeds - to build the relationship with their customers.
Rocky Scopelliti is the group general manager industry executive, Telstra Enterprise & Government
