Wealth Managers need to Embrace Mega Trends Now to Survive and Thrive

Helene Ackermann of CREALOGIX

Jun 7, 2021

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As the world moves ever closer to the return to ‘normal’ we all so crave, the need to position one’s self on the precipice of this new reality is all the pressing. In the hopes of assisting in this transition, CREALOGIX’s Helene Ackermann spoke to Hubbis, taking the time to break down the changing trends which have transpired as a consequence of the pandemic, as well as highlighting the opportunities for and benefits of embracing digitalisation for Asia’s financial service providers, which ultimately will allow them to better engage and serve their clients.

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1. What are the most notable effects of the pandemic in acceleration and deceleration of global megatrends?

2. So Helene, how can these global megatrends be translated and institutionalised by banks?

3. Where do you see the most urgent need when it comes to investment priorities within digital wealth services?

4. So how can banks leverage the opportunity of digital services?

5. Can you demonstrate or give us an example of how the whole set-up of such digital wealth management services could look like?

Video transcript

1. What are the most notable effects of the pandemic in acceleration and deceleration of global megatrends?

Ackermann: So, one of the most notable effects of the pandemic is the scale and acceleration of several megatrends, and deceleration of others. So until the pandemic hit, almost everyone believed certain societal forces were here to stay, like sharing economy, urbanisation, and globalisation. Now, a lot of the megatrends have changed, and I would like to share them with you because I found them quite interesting. So with the pandemic, the mega trends changed into focus on cost reduction, one of the mega trends. Focus on safety and surveillance. Focus on corporate responsibility, much more. And one of the top two changes we see in the global mega trends is the virtualisation of the workforce, we work differently, and of course, on top of it, the digitalisation, which has a huge effect as well in our industry. And I would like to say also, I saw lately what happened is not only digitisation as a topic, but also knowing that we have to be much faster after the pandemic. It's also an acceleration of timing. So it changed on one hand of the middle trends, and on the other hand, really also the acceleration of making decisions, and of digitalisation.

2. So Helene, how can these global megatrends be translated and institutionalised by banks?

So I think banks already started to really change the way they work. During the pandemic, they started to be agile. They started to flatten the hierarchies. They started to have the communication to see the decision-making process much faster. They also had digitisation, etc. They work differently, so we all work from home, we all achieved our work from laptops and mobiles, for example. So if banks continue to really do that and make sure that they also have in the future, what they learned during the pandemic, this will really help. So really use the mega trends in digitisation and really work differently with the workforce. That's one end. On the other hand, we also see that the industry itself is changing. So a lot of things or offers that used to be very important in banks are not so important anymore, like going to a bank itself, for example. And on the other hand, we also see more and more neobanks, emerging, different approach, banks who were innovative and are innovative. And I think that's an important part. Customers today do expect that their bank is innovative and inventive. That they give the right technology that the customer can use. And it's not only about accessing and having the right technology, but also make it a customer experience, surprise the customer. It doesn't matter if you're a retail customer or you’re wealth customer, you have to as a bank, to change how you work with customers and how you can surprise them and have an innovative way. And we also looked in 2020, even the wealth customers, they changed, they said for them to have digital offerings is far more important than the years before. So it increased by 61%.

3. Where do you see the most urgent need when it comes to investment priorities within digital wealth services?

We did the research just lately with ComPeer, which is one of the research companies in the city of London. And we talked to 500 investors, so people who are really in the wealth sector and investing their money. And we talked to them to understand what is important to them in the digitisation of the world. And I think we got a lot of valuable insight that I would like to share. And it's also important, one of the most important topics, and I also mentioned it before already, banks have to become customer centric, and that was what the wealth investors also gave us as feedback. So a lot of them just want to have life statements and performance reports. So be able to have real-time data they can select from, or have potential relevant information about next portfolios they want to invest. Or even very basic things like administrative tasks changed to contact. And I think that's very important, only 8% said for them it's still important to have a personal telephone contact or be able to pass by the bank. This means 92% of even the investors in the wealth area, they're really counting on digitalisation and having the right tools. And I think that's an interesting fact that we have to take into consideration moving forward.

4. So how can banks leverage the opportunity of digital services?

Imagine that only half of all those investors that we asked, they are accessing the digital wealth service daily or weekly. So if you count that up, that's 52 or 365 opportunities to offer a value to this customer, to make an up sale. But on the other hand, half of them were really not happy with they got with their investments, asset management, etc, as a digital offering. They didn't like it. They were even dissatisfied, a lot of them. And I think that's an important thing. So, really understand why they are dissatisfied and really use those touch points to, as I said before, surprise those customers and also make use of the data and make offerings which they see as a value. And I think that's something that should be worked on. On one hand, we also should use the digital channels on onboarding new customers, and also giving them the right messages and value-add services that they stay. But then also with the existing ones to really make sure and understand what can we do more besides offering them the basic digital journey, really go behind the borders and think about what can we do exceptionally for those customers. If we know that one of our customers likes to play golf, why not offer him automatically, with the right technology, additional, let's say certain offers for golf areas, etc. So really start not only onboarding and have the right to choose stations for different channels, but really also get creative. How can you work with those customers? How can you make a very nice experience for these customers to do business with you?

5. Can you demonstrate or give us an example of how the whole set-up of such digital wealth management services could look like?

Very interesting question, and I have a couple of use cases, but let's talk about one specific today. So there's a German private bank we're working with and this German private bank has locations around the globe, outside of Germany, of course, in UK, China, etc. And they wanted to have an offering to their customer that they could access 24/7, the digital services. And therefore, we worked with them on a robot advisory. So every investment that a customer does, which is more than USD50,000, he gets a digital onboarding, he sees the possibilities of investment, he has a customer-friendly identity. So therefore, they were able to really offer the customer a 24/7 hybrid advisory service, which is very good for the customer. He can still have the direct contact that he wants to, but he can really have the full seamless experience on a digital journey when he onboards or he wants to make an investment with the robot advisory. We have a lot of other use cases. So in case you're interested to see how we can help you to get even faster, innovative way into the new and after pandemic world, please visit our website. You will see an insight about wealth management with a lot of good documentation. What can be done? What are the trends? And what can be done to be ready, not only now, but really for the future? And it's time to act now. So looking forward to working with you.

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