From Simon Edwards, Chief Revenue Officer at BlueMatrix
As one of the world’s largest wealth management centres, the UK’s continued growth is now fuelled by a rising tide of young affluent professionals, entrepreneurs, and next generations of wealthy families. This new breed of investors has very different priorities and expectations compared to those of its predecessors. There is now a desire for information that is far more digestible, more accessible, and more immediate. But is the wealth management sector equipped to meet the needs of this digital generation?
In short, not yet. The pace of digital transformation in wealth management has been slow compared to other industries. With a new kind of customer audience, industry players need to wake up to the need to adapt and bridge the technology gap. Embracing innovation and all its possibilities has now become crucial to stay relevant. Responding to emerging trends and incorporating technology into their offering will mean firms remain competitive in this evolving landscape.
Learning from the wider sector
The wealth management industry can gain invaluable lessons from the banking sector, which has harnessed the power of technology much faster and more effectively to address clients’ changing needs. Even the big banks are catching up with their more agile fintech competitors to use innovation to deliver more dynamic client engagement.
Just as with the larger banking sector, the integration of data and advanced analytics will be critical to transforming the wealth management landscape. By harnessing the power of data, wealth managers can delve into vast troves of information, gaining important insights into the latest market trends and investment opportunities and passing onto their clients to help them make their investment decisions.
Understanding your investors
On the subject of data, there is now an increasing industry expectation for wealth management firms to develop more descriptive and predictive analytics. These should seamlessly integrate internal and external data, both structured and unstructured, to construct thorough and insightful client profiles. This multifaceted approach allows for a deeper understanding of clients’ financial behaviours and preferences, creating tailored strategies that resonate with individual needs and goals.
It’s particularly important to understand the ‘do-it-yourself’ mindset of the new-age investor, who wants to maintain control as much as possible. This includes the need to access their investment and banking details from multiple wealth management accounts, all in one place. Technology will enable wealth management firms to tailor advice and services to cater to this need for self-management. By providing comprehensive, data-driven insights, clients will have the tools they require to help them make informed decisions, enhancing their sense of confidence in managing their investments.
Tailoring the client experience
The ways in which people consume information have undergone a profound shift. Mobile devices, including smartphones and tablets, are obviously now the primary platforms for accessing and sharing content for the new generation of clients.
Wealth management firms therefore need to develop digital strategies that deliver information on the go. By doing so, they can offer personalised omnichannel experiences, including videos and dashboards, that fit seamlessly into their clients’ unique lifestyles and behaviours.
For example, BlueMatrix’s investment research platform facilitates sharing via mobile devices the latest insights in a targeted way with clients and internal stakeholders. The platform offers full control over content visibility, tailored reporting and compliance adherence, helping time-poor readers make important investment decisions, wherever they are.
Having said all this, and despite young investors’ comfort with these platforms and the desire for self-management, you still need to strike a balance between the digital experience and the human touch to establish relationships and, above all, build trust. There is a middle ground between integrating technology and automated processes with providing expert opinion and considered guidance. Even in this digital age, people still want to deal with people.
The future is digital
We are navigating a very different kind of wealth management landscape than we were even a few years ago. A younger, always-on generation of investors are seeking sustainable, innovative, and easy ways to invest 24/7. But they also value the guidance of trusted experts in their field who understand them and help foster good investment behaviour, especially during these times of increasing market instability. The right combination of innovation and expertise will therefore be critical for the continued growth of the UK’s wealth management industry in today’s digital era.
