The drive to put clients at heart of wealth management
Wealth managers claim to put clients first, but most could do much more. Recruiting heads of client experience would help quicken the pace of change
“Put the customer at the heart of the service experience” – that is the gauntlet that one global wealth management firm intends to throw at the feet of its new executive and head of client experience (CX). Challenged to “drive transformational change in customer journeys” and deliver “sustainable competitive advantage through best-in-market customer experience”, the optimism of all would-be candidates must be applauded.
It is tempting to believe these eye-wateringly high expectations are baked into the value proposition of global firms. Tempting – but wrong – because most wealth firms only dabble in CX measurement but are yet to wake up to the CX revolution, let alone appoint a head of CX responsible for building compelling value propositions that marry serving clients with business success.
Scorpio Partnership’s latest HNW insight study revealed the world’s wealthiest investors are seeking more feedback than ever when choosing a financial provider. The significance of ‘independent opinion’ in their selection process – including client referrals, ratings and reviews – has risen by 15 per cent in the last two years, more than any other customer experience factor. HNWIs and UHNWIs are showing a thirst for quantitative feedback and, despite the fact ratings are uncharted territory for wealth managers, the industry may now be on the cusp of launching an equivalent of a wealth management TripAdvisor.
With clients actively seeking the opinion of peers and digital channels offering those views unlimited amplification, it has never been more important to deliver an outstanding client experience.
Once upon a time, truly outstanding customer service was the preserve of the brands courting only the super-rich. Now mass-market Apple has emerged as the most popular elite brand in Scorpio’s Brand Love index , with 68 per cent of the world’s futurewealthy, those with a net worth of more than $4m (€3.2m), owning an Apple product, and Amazon claimed the top spot in a survey that asked CX leaders who they most admired.
Both brands share an insatiable hunger to understand what clients want and use that insight to deliver products and services that consistently delight customers. Few would doubt wealth managers are generally committed to the theory of good service but their attention to understanding the detail of what customers want falls short. Just ask the clients. Almost 40 per cent of customers worth more than $4m feel that their wealth manager neither understands their financial goals nor their product and service preferences.
That is simply not sustainable for an industry built on client assets and advocacy.
It is not good enough to deliver discrete service improvements or bolt-on digital propositions and hope for the best
Neither is it good enough to deliver discrete service improvements or bolt-on digital propositions and hope for the best. Putting customers at the heart of wealth management requires a bottom-up approach based on thorough analysis. It means drawing on all available data to build a genuine understanding of which parts of the customer journey matter most to customer satisfaction and it means having the courage to reimagine the whole service model and the compensation structures that underpin it.
Firms must accept that, right now, they do not have sufficient insight around the lifetime experience and expectations of their clients. This process of accepting the unknown has been described by Forbes as “cathartic” but might just as easily feel terrifying. Either way, though, elevating customer experience to its appropriate position within an organisation will always be transformative, and the first step is to recruit a head of CX to navigate a path through that change.
If more firms appoint CX directors the pace of change will quicken and wealth management will be able to embrace customer experience strategy, design and execution as a core competency.
And it must. We have left behind the 20th Century world which was driven by institutional authority and the might of super-brands. Today, power is flowing to the individual and electronic connectedness is accelerating that shift. Customers expect brands to become fully integrated into the patterns of their life, right here, right now. It is up to firms to acknowledge this new reality and create the “devoted relationships” that clients crave.
As the disintermediation of mass media continues, and digitally powered customisation takes over, more and more of a firm’s success will lie in the nuances of customer experience. The rigorous design, testing and evaluation of global advertising campaigns must be echoed in an equally rigorous approach to understanding, benchmarking and evaluating client experience.
Firms must know how their service stands up against competitor brands and know how each customer touch-point connects to the bottom-line. They must create reliable and frequent feedback loops to check-in on progress and they must be relentless in their determination to put the client at the heart of their business.
If not, the door will swing wide open for competitors – perhaps those very brands who have honed their customer experience skills in other sectors – to become the client’s new best friend.
David Lo is an associate partner and Annie Catchpole an associate at wealth management think-tank Scorpio Partnership
