In recent years, stand-out retail and luxury brands have cultivated a loyal customer following by perfecting the art of mass customisation. If you want a pair of new trainers, NIKEiD lets you to design them for yourself. If you’d like a new perfume, Cologne Atelier can help you create a personal scent. Search for a song on Spotify, or a new binge box-set on Netflix, and you will find playlists and programs that feel like they’ve been designed with you in mind.
Across industries, customer intelligence platforms are enabling sellers to re-fashion themselves as advisors. While customers’ immediate needs are perhaps met by the product on sale today – their long-term loyalty can be extended by the way in which their personal data is subsequently used. The preferences and digital behaviours of millions of buyers are therefore used to directly inform the development of new products, and as a consequence, these platforms begin to understand you well enough to make specific recommendations for what you’ll like next.
HNWIs in Asia-Pacific (APAC) are not immune to these developments. In fact, having experienced the benefits of customisation in their personal lives, many investors are accordingly scaling up their expectations of their wealth management relationships. Our recent research on behalf of BNP Paribas Corporate and Institutional Banking (CIB) found that customisation is a key demand of a new client profile that is defined not by demographics, but by drive. We call this clientele ‘Empowered Investors’, because they actively seek more involvement in decision-making around their investments through closer collaboration with their advisors.
We examined the perspectives of over 1,000 HNWIs across eight of Asia’s financial hubs: Australia, China, Hong Kong, Indonesia, Japan, Malaysia, Singapore and Taiwan. When asked to outline their vision of the ideal private bank, we found over half reflected the desires for customisation and self-service that typifies this new mind-set. Moreover, such attitudes are particularly prevalent among ultra-high net worth investors.
Personalised portfolio information is the clearest starting-point [Figure 1], with many clients looking for their own data to be accessible and more useable. In fact, across seven of the eight markets, having access to tailored investment data is considered more important than having access to products or fees that take into account individual investor preferences. Chinese clients are most advanced in their expectations.
Figure 1: Desired customisation to advisory relationship
Q: What degree of customisation would you like in each of the following parts of your experience with a financial advisor?
Source: BNP Paribas Corporate and Institutional Banking & Scorpio Partnership
Our findings also indicate a range of other changes wealthy APAC clients want to see enacted across the investment journey:
- Goals: HNWIs believe their advisory meetings should become more focused. 55% would like to use them to review progress towards their investment objectives and plan for the future. Wealth managers should therefore think about whether their current delivery model provides enough transparency about investment performance ahead of meetings so that both sides can come prepared to discuss goals.
- Platform: For many investors – particularly in Singapore and Taiwan – the dream client portal would incorporate tools that permit better independent execution, such as portfolio performance analysis and financial research. But before investing in this type of functionality, advisors need to question whether more fundamental client needs are being met. For example, most investors prioritise the understanding of their own investment position, with 62% saying they simply want a clear portfolio overview on the home-screen of their main investment platform.
- Communication: Asia’s investors have advanced expectations around instant communication with their financial advisors. Many have opened up the channels they regularly use in their personal lives, like WhatsApp and social media – to secure rapid responses to their professional questions too. These channel preferences also have implications for how wealth managers can most effectively communicate important market updates: their clients expect to be able to pick and choose relevant insights instantly and on-the-go.
Empowered Investors are an exciting clientele. They are highly engaged and committed to working more collaboratively with their advisors. At the same time, there is no doubt they pose a challenge to Asia’s wealth industry, which must show it can continue to deliver value to clients – even when their expectations are being set by brands in other sectors.
If there’s one mantra we hear time and again from the industry, it is that “bespoke service” is key to long-lasting relationships. It is therefore time Asia’s wealth managers start listening to what kind of customisation their clientele actually wants.
To read the full report The Empowered Investor: Part I, please visit this link.
Thought for the week:
“Put your consumers in focus, and listen to what they’re actually saying, not what they tell you.” – Daniel Ek, Founder and CEO, Spotify
News from the world of wealth:
Financial Times, ‘Investors braced for volatility in tech stocks’
Portfolio Adviser, ‘Property back in the black but have lessons been learnt?’
Wealth Manager, ‘How ready are you for MiFID II?’
Financial Times, ‘Best of Lex: ten years on from the financial crisis’
Author: Tasha Vashisht, Senior Manager
Expertise: Tasha co-leads our thought leadership initiative at Scorpio Partnership and also focuses on market insight and strategy projects. Prior to joining the team last year, Tasha worked at an insight and innovation consultancy, where she supported a range of clients to develop growth strategies.
Background: Tasha holds a Master’s degree in EU governance from the LSE and a Bachelor’s in Philosophy, Politics and Economics (PPE) from Keble College, Oxford. She enjoys brunching, watching Frasier re-runs and learning Spanish, but finds the idioms are often her downfall.