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Differentiation Is Key As Wealthy Investors Get More Hands-On With Their Finances - Global Study

Eliane Chavagnon, Editor - Family Wealth Report, February 9, 2015


To succeed in an intensifying competitive environment, financial service providers must look beyond product satisfaction and focusing on building a more "complete client experience" that prioritizes advice and service - CEB.

Wealth management

The implications for the wealth management sector include that, in order to win new and retain current business, organizations must emphasize the value of the advice and service they can provide.

“Even as it [the financial services industry] receives high marks on product satisfaction and benefits from a healing economy, particularly for the wealthiest, distrust has also prompted clients to spread their wealth more widely among providers and to invest in more conservative - and lower margin - products,” CEB said on its findings.

When asked what we can we infer from these key findings in terms of how the wealth management sector has evolved in recent time, Aykens believes the primary change is that competition based on beating a benchmark is “no longer sustainable.”

“Clients are demanding advisory strategies that give them confidence they will hit their primary financial goals [and] not just a short-term benchmark,” he said.

Indeed, there has been a raft of industry research in recent time suggesting that client satisfaction improves significantly when investment advisors collaborate to set personal financial goals, and then develop an investment strategy and performance review process around these.

CEB said other research it has carried out suggests that providers will “struggle to differentiate themselves with products that can now be easily replicated by non-traditional entrants at low cost.”

They will need to win on a “comprehensive approach” to advisory support as – although most wealthy clients are comfortable with their balance sheets and are satisfied with the product offerings available – this is “not enough.”

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