This is a sponsored article from Thomson Reuters.
Thomson Reuters commissioned Forbes Insights to survey 200 wealth advisors globally to understand the impact of the evolving wealth management industry. In this article, we will focus on the findings in Asia Pacific.
Wealth managers face a myriad of challenges, including maintaining a competitive advantage, meeting ever-greater customer expectations, responding to changing market conditions with speed and agility, and ensuring they continue to offer real value to investors.
To meet today’s investors’ increasing demands, wealth managers must stay informed and connected, while exercising critical time management to service their clients.
Technology needs to support and enable advisors to do their jobs more effectively. Firms must decide which technologies are necessary and which are not worth the investment.
Client acquisition and retention
Over two-thirds (68%) of wealth managers spend most of their time on client acquisition and onboarding. This is followed closely by risk, compliance and sales practice; and then by investment research and portfolio management activities.
When attracting and retaining clients, wealth managers rely on a combination of factors: the ability to provide advice beyond the portfolio, connecting with the next generation, and the use of digital tools for communication.
Advisors report that the advice they provide and the time they spend with clients play a major role in retention. They feel the pressure to constantly prove they can add value by helping clients stay on track to reach their goals.
Automation can help advisors customise client outreach in less time, resulting in more time to spend where they can add the greatest value.
In Asia Pacific, 87% of advisors believe that the ability to provide advice beyond the portfolio under management is also key to retention. This was followed by three quarters (75%), who said that connecting with the next generation in anticipation of a transition of assets is crucial. The third most popular factor, selected by 73% of those in the region, is the use of digital technologies for communication.
What’s next for relationship building?
A large proportion of advisors (63%) see artificial intelligence as an opportunity. No one views it as a threat.
This is highly encouraging, as wealth managers see the advancements as an enabler to help with time-sensitive and time-intensive activities rather than as a source of disruption. 57% believe that advanced analytics and cognitive technologies will have the greatest impact on the wealth management industry over the next three years.
Personalisation becomes more complex in the age of digitalisation — and something millennials and many others take for granted.
Wealth managers need to use technology, data, and digital tools to better understand and manage their clients’ unique needs and make the relationship personal on their clients’ terms.
In recent years, wealth management practices have concentrated investments in big data and advanced analytics.
This is particularly a means to prioritise and analyse all data related to financial goals —demographics, weather, political, and financial risks — and to analyse client data over time and in relation to other proprietary data.
They have focused on applying those findings to offer relevant products based on demographics and goals. In future, cognitive capabilities and advanced analytics to enhance decision making and portfolio management top the list for future investment.
The future of wealth management
The role of the wealth manager could change dramatically over the next few years. Not only do clients expect better tools of engagement, but advisors will be serving ever more clients and for lower fees.
They will need to ‘know’ their clients with the same speed and precision of machine learning.
At the same time, wealth managers will need to constantly bridge the digital divide between their less tech-savvy clients and the digital natives who will control more of the world’s wealth in the decade to come.
Read and download the full Digitalisation of Wealth Management – A Focus on Asia Pacific report here.
This is a sponsored article from Thomson Reuters.
