Clients expect personalization and are willing to share data to make it happen
Nowadays, customers looking for financial services and advice are presented with more options than ever before. The rise of innovative players, such as FinTechs, has been endangering banks’ dominant position for several years. It no longer comes as a surprise that, to remain relevant, they have to redefine their client relationships to improve satisfaction.
The key to achieving this lies in understanding rapidly-evolving client needs. In recent years, the collapse of companies that have failed to do so in various industries, such as Nokia, Blackberry and Blockbuster, has proven how important this is.
For Private & Wealth Managers, this means offering tailor-made experiences with a human touch. Increased service digitalization cannot become an excuse to resort to a standardized offering. Indeed, EY’s 2021 EY Global Wealth Research Report found that 30% of wealth clients are looking to move assets to another provider in the coming future due to a lack of personalization or understanding of their personal goals and purpose.
Today, financial advisors need to go back to the fundamentals: investing time in customer relationships. The only way they can do this in an ever-changing world is by leveraging data. This will allow them to better understand each client, but also to spend less time on administrative and research tasks and, instead, focus on what really matters.
Client data collection should not be seen as a major challenge. The Global Wealth Research Report shows that European clients, especially among the younger generations, are more willing to share personal data with their primary Wealth Manager than with their doctor if this allows them to receive more relevant services and an enhanced customer experience. The study found that 72% of respondents were willing to open up about their financial goals and ambitions, and more than half were also happy to divulge their personal aims and objectives.
The real challenge thus lies, not in collecting data but in analyzing and leveraging them. EY recently reported that 85% of leading financial services firms believe data is their most valuable strategic asset, yet only 16% consider themselves “excellent” at extracting value from their data.
This translates into a weakened customer experience.
Switching banks has never been easier. It is therefore vital for them that Relationship Managers (RMs) start focusing on client-centric operating models to deliver a positive and seamless client experience, at every step of the relationship.