In January we shed a light on what we expected to be the trends shaping the Wealth Management industry in 2021. A lot has been said on digital transformation and how it affects client experience, not to mention the growing attention on ESG investing. After nearly seven months, we see these trends have not done yet, and they will continue to pilot the wealth industry.

Now that society seems to be gradually coming out of the storm, only financial institutions that recognise the so called “short-term measures” as market trends potentially driving the future will be able to move forward in an industry that is bound to be even more competitive in the next normal.

Thanks god it’s digital

It is safe to say that the health crisis has not exceedingly altered the overall strategic imperatives; long before Covid-19, digital has been playing a crucial role as a key driver for economic growth and social transformation. However, there is no denying it has accelerated the degree to which digital is fundamentally changing business, paving the way for more rapid, technology-driven changes going ahead.

According to Objectway’s research Setting the Digital Agenda for the Next Normal, the wealth industry is currently fast-tracking digital development to improve internal performance and maximise client experience. If not properly addressed, digital transformation will widen the gap between those firms that are willing to explore innovative digital operating models, and those with a poor digital offering that will struggle to survive in the digital landscape.

The digital client experience

In the next normal, firms will be demanded to provide existing services in a more cost-efficient or scalable way to both retain existing customers and acquire new customers.

Indeed, although rarely thought as a cost-cutting exercise, digital is actually a powerful mean to enable scalability and improve client experience. In times where in-person meetings, events, or any other occasion for exchange run low, the client portal becomes the heart of the digital experience.

Future developments will target new features to make the portal more interactive, offering services such as secure messaging, money transfer & online payments, access via mobile app etc. against the basic services offered by the view-only portals; a well-developed portal will provide clients with unlimited, easier access to their portfolio and a direct channel to communicate with the relationship manager.

Technology is therefore being used to maximise the user experience, to take the service firms offer to the next level. Through digital tools, firms are able to keep customers’ attention alive with the implementation of highly customised communication tactics and experiences.

On this matter, client onboarding is now a primary area of focus. Developing smooth onboarding process will be one of the major differentiators between firms, making client relationship start on a positive footing and providing the chance to efficiently capture data and feed it into the CRM system.

For this reason, companies are looking to integrate onboarding into the client portal to offer clients more exposure to the process. Providing clients with the ability to login and sign documents can significantly speed up the time taken to onboard each client.

The client-advisor relationship has undergone a digitally driven evolution too. The well-known traditional advisor has given way to the digital advisor, whose relationship with clients will develop in a hybrid model. Advisors will try to reshape the “trust component” in a digital setting via the typical elements of a digital relationship, for ex. remote communication. All this will encourage the advisor to acquire a new palette of competences starting from a framework of communication techniques that are totally different than before. Adopting new languages represents a golden opportunity to detect new clients belonging to the new digital-native generations.

Stay tuned to read more about what we’ll be expecting for the next normal.