Creating the future client experience | Scorpio Partnership

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By Tasha Vashisht

Wealth management may be primarily associated with high-touch human interaction. But as firms look to protect and build their share of wallet – and clients instinctively reach or their smartphones to manage more aspects of their lives – the potential of digital to deliver financial value and differentiate the customer experience is now compelling.

The digital challenge
The role of ‘trusted advisor’ is associated first and foremost with building deep human relationships. Consequently, wealth managers have often struggled to determine the role of digital in their business. But wealth managers now face considerable supply- and demand-side pressures to reappraise client-facing technology as a strategic priority:

Clients have a growing appetite and expectation for smartphone-style functionality across more and more aspects of their lives, including how they invest.

Fintech challengers are making a long-term play for young investors. By onboarding customers at an early age, a trusted relationship could be fully formed by the time an individual has meaningful capital to invest.

With price pressures across the value chain, wealth managers need to harness technology to scale their business – delivering exceptional service to high- value clients while servicing smaller clients in a way that still demonstrates the value of their proposition.

…and the digital opportunity

The good news is that clients shouldn’t need too much persuading to use more online functionality. Nearly nine out of 10 investors across the wealth spectrum are already using online services to complete some investment activities – and 82% expect their primary advisor to enhance the online investment process over time.

(Source: Scorpio Partnership/Factset)


Five actions to embed digital in wealth management

Based on our research into the digital expectations and preferences of investors across the wealth spectrum, we’ve identified five key ways that wealth managers can approach technology to help demonstrate and deliver enhanced value to clients:

1 Configure the client experience to the needs of early adopters
Rather than segmenting clients by age, it may be more beneficial to prioritise the requirements of early adopters. These individuals self-categorise as tech evangelists and have an average net worth of $5.82 million. Just as importantly, where they go, other clients are likely to follow.

Our research shows that online guidance and execution functionality and interactive tools to assess wealth and portfolio performance are the top digital expectations among this cohort.

2 Address digital pain points
Understanding what can deter clients from using a digital proposition is as vital as knowing what can appeal to them.

Performance data that isn’t easy to understand or analyse and information that’s not customisable to the client’s own interests and goals are seen as two of the biggest shortcomings in wealth manager platforms – notably among those investors who are most keen to adopt digital.

3 Focus on tech to enhance investor outcomes
To increase share of wallet, wealth managers need to consider what digital functionality is perceived by clients to enhance investment outcomes.

Real-time analysis of investment performance, real- time reporting of investment positions and personalised investment suggestions are all seen by investors in our research to contribute to portfolio optimisation.

4 Use digital to manage (and retain) lower-value clients…
Certain tech – such as interactive planning tools and easier comparisons between different products and services – may nudge costly- to-serve customers to complete most of their investment activities online but still demonstrate your firm’s ability to help them build wealth.

5 …and delight your most valuable clients
Over a third of ultra-high net worth clients say an open-architecture product choice is key to being persuaded to use a wealth manager’s online platform, alongside easier product comparisons and transparency of fees and charges.

Conclusion: inaction is not an option

Clients of all sizes, from the mass affluent to the ultra high net worth, now expect their primary financial institutions to provide digital capabilities to help them make meaningful decisions and realise greater financial value.

Harnessing the digital opportunity requires a shift in mindset among traditional operators and even taking a lesson or two from fintech challengers. But the question for wealth managers now is not whether to introduce more advanced digital functionality – but when and how.

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Tasha Vashisht

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