India’s HNWIs place higher importance on self-service capabilities compared to dedicated time with human advisors, according to a survey conducted by Appway and Aon released today.
The report, titled ‘Innovate to Succeed: The Client Call to Action for Wealth Management’, showed 44% of respondents revealed that self-service capabilities are one of the top three factors for wealth managers to focus on, and is followed closely by reduced social and environmental impact of business operations. In contrast, only 21% considered dedicated time with a human advisor being important, whilst 43% of global respondents named it as the most important trait.
Self-service capabilities, alongside digital communication channels and fully digital account openings are all technology-enabled services, which the report underscored as “continuing pressure on the wealth management industry” when it comes to serving India’s HNWIs. As such, the report is in view that wealth management firms should “be more like a tech company” and not only offer digital services, but also operate at a competitive advantage.
“Our study showed that Indian HNWIs believe that the most beneficial innovation to them would be if wealth management firms would be inspired by Amazon’s business model and offer a single marketplace of multiple products and services,” Madli Lillemägi, Appway’s Marketing Manager EMEA & APAC, told Asian Private Banker.
“But also contextualise information whenever possible like Google and provide a high touch interface, even if it’s at a premium price, like Apple.”
Furthermore, the study showed that India HNWIs have a higher propensity to switch wealth managers, with Indian respondents citing that they were around three times as likely to switch in the past five years compared to their global counterparts.
According to India’s HNWIs, lacklustre investment performance, high fees and charges, and complicated or confusing internal processes are the main drivers when it comes to switching wealth managers.
“For wealth management firms to move beyond competing primarily on investment performance and fees, they must find other areas in which to differentiate themselves in the minds of clients to avoid the commodity trap,” said Lillemägi. “It is through unlocking new sources of value that they will be able to strengthen loyalty and improve client satisfaction.”
The report surveyed 272 global investors in May 2019, including 51 in India, with an average net worth of US$1.41 million and US$1.54 million respectively.