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Personalisation to drive future wealth management

3 minute read

The majority of wealth managers believe delivering more customised services to clients is essential to stay competitive, but a third are unable to deliver personalisation to the degree that they wish, according to a new survey.

The Next-Generation Wealth Managers: Advancing Services and Personalisation with Technology report from Forbes insights and banking software company Temenos found that almost seven in 10 wealth managers believe that a virtual platform is essential to enhance the client experience compared to only 25 per cent three years ago.

Nearly two-thirds of wealth managers (64 per cent) are segmenting their clients and creating detailed and distinct profiles, while around a third (32 per cent) are unable to match demand for personalisation in line with high-net-worth individuals’ (HNWI) expectations.

The report lists three pathways that will define the next generation of wealth managers: customer experience enhanced by digital services and personalisation, insight from artificial intelligence and analytics, and new markets defined by mass affluent and alternative investments as well as operational efficiencies.

Pierre Bouquieaux, product director of wealth at Temenos, said delivering personalised customer experiences will become the key differentiator for wealth managers.

“Both HNWIs and mass-affluent investors want to enhance their relationships with wealth managers through more personalised services,” Mr Bouquieaux said.

“Technology, from the client perspective, should facilitate more active portfolio management, unlock new insights through predictive analytics and reveal opportunities that may exist in alternative investments.”

Around 86 per cent of wealth managers were reported to see AI as important in data analysis and personalised insights, compared to 67 per cent last year.

Additionally, the report found that 87 per cent of wealth managers viewed technology as being “significant” or “highly significant” in achieving operational efficiency.

Acceptance for digitisation among HNWIs has increased to 87 per cent over the past three years, from 74 per cent in 2016.

The report also conveyed that in comparison to the last three years, HNWIs and mass-affluent investors have called for better results from more active portfolio management (44 per cent) and greater predictive analytics and forecasting (36 per cent).

Temenos added that technologies such as goal-based investing will be vital in the future, having expanded its front office WealthSuite with a goal-based investing module.

The software provider said the module would allow wealth managers to offer client-centric and highly personalised products and services, as well as making execution of services faster, cheaper and more efficient.

The results came from a survey of 305 high-level executives, with more than 40 per cent being in the C-Suite, a fifth being heads of asset management and 14 per cent and 10 per cent, respectively, being managing directors and heads of business at investment banks and at private banks as well as 105 HNWIs.

Sarah Simpkins

Sarah Simpkins

Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth. 

Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio. 

You can contact her on [email protected].