There is an endless array of invaluable data available. From tracking every transaction, journey, spending habit, behaviour, preference, and anything else you can imagine, there is a data point. But how much of this data is being captured, analysed, and adjusted to make clients’ journeys smoother and more profitable?

This valuable data is not always being put to work. Opportunities to create customer insight, address shifting customer expectations, and plan for the future are being missed. This is all the more relevant given that the sector is undergoing a paradigm shift. Changing demographics, new client priorities and behaviours, challenging macroeconomics, product democratisation, more regulatory oversight, tight margins, and ever-increasing competition. Customer insight driven by the effective use of data is going to be key for the survivors of this shift.  

So, who will adeptly meet the needs of tomorrow’s investors? Traditional wealth management firms, agile and customer-centric WealthTechs, or family offices positioned to deliver a wide range of services with one-stop-shop convenience? 

Ultimately it will not be the type of wealth manager or service they offer but those that embrace the data sets they can extract, aggregate, analyse and report from, in real-time, from their various core and third-party systems. The aim must always be to support the client experience. 

In a nutshell, robust core and augmented ecosystem capabilities (such as data-driven and digital products, real-time omnichannel digital engagement model, and hybrid advisory services) are now critical. 

Indeed, customers are demanding a wider array of investment options delivered through an improved, seamless service experience. 

While relationship managers are increasingly empowered by access to real-time data, streamlined workflows, and multichannel and digital tools, the critical question is how much information is being created from that data. Can the data be used to provide triggers? From defining the next best actions for an adviser and their client to an investment recommendation to capitalise on market moves from interest rate hikes to fund performance?

For advised customers, for example, the baseline investment outcome expectations established through fact finds, suitability, and risk score profiling, plus insight gathered through mapping of a customer’s activities in between reviews, can give an adviser a much deeper understanding of the customer’s actual behaviours and wants. This goes much further and is deeper than the adviser would garner from a client meeting. And for non-advised customers, the insights gained through collated data can be one of a few touchpoints, enabling relevant information to be communicated to the customer promptly. 

But leveraging the data relies not only on the analytics by the digital tools to deliver them. The two go hand in hand. To meet evolving client expectations, retain the next-gen, and capture the expanding mass affluent segment, advisers must consider transitioning to a personalised, hybrid advisory approach. 

In this way, data enablement dovetails with digital transformation and customer-centricity to deliver frictionless and meaningful client convenience. 

This will become more important as the concept of embedded wealth management gains traction. Distributed via FinTech platforms and open APIs, embedded offerings are disrupting industry dynamics and incumbents. But to succeed, the digital delivery mechanism needs to be sleek, and the data and information need to be relevant and timely. The two add to client convenience and experience, which adds to client retention. 

This is ably demonstrated by the fact that family offices are being used more and more by high-net-worth clients to provide a more personalised service. Clients want what they need at the time and over the channel of their choice. 63% of HNWIs already prefer family offices to large banks or wealth management firms, according to Capgemini.

And 23% of HNWIs and 33% of Ultra HNWIs say they already use family offices to manage their wealth. The main reasons why HNWIs prefer family offices are - one-stop-shop convenience (52%), personalised services (52%), and transparent cost structure (49%). 

Capgemini also found that only 46% of wealth firms augment adviser capabilities with what clients want; leading-edge digital tools for personalised engagement.  

So clearly, in order to capture these growth opportunities and address changing client needs, the level of data captured, analysed, and triggered into actionable insights needs to become more at the centre of the CMO, CIO, and COO’s attention as they invest more time and money into digitising their processes and upgrade their systems.