3 client experience areas every wealth manager should consider

3 client experience areas every wealth manager should consider

3 client experience areas every wealth manager should consider An Ernst & Young survey of global wealth management clients finds that 40% of all respondents are open to switching wealth managers under the right circumstances.

According to the firm’s 2016 global wealth management report, titled The experience factor: the new growth engine in wealth management, firms that fail to make strategic investments to deliver a superior client experience may risk losing a substantial portion of their current business, with up to US$200 billion possibly at stake.

"The dynamics of the wealth management industry are changing rapidly," said Gregory Smith, EY's Wealth Management Advisory Leader. "Retaining clients will become a high priority for firms, given the increasing awareness around robo-advisors and new advice models. Wealth managers need to engage their clients more than ever and invest in a creating better customer experience – increasingly using digital technology."

The firm found three key areas in which wealth managers and their clients have opposing views:
  • Transparency: Clients are increasingly questioning the transparency of portfolio performance and fees. They are also eager to rate their advisors and connect with similar clients in public forums.
  • Advice delivery channels: Clients are significantly more open than firms to adopting digital channels for wealth advice, not just service.
  • Role of the advisor: The financial advisor may become more like a financial therapist in the future, helping clients with spending habits or reaching life goals instead of strictly providing standard asset allocation advice.
Transparency, particularly in portfolio performance and fees, was overwhelmingly identified by clients as the top driver of trust, pushing reputation down to second place. With new CRM2 requirements mandating increased transparency, the focus on transparency will only increase. The client experience and demonstrations of value provided have to be enhanced through investment in technology.

"We've seen an increase in regulatory requirements to offer more transparency to clients and we might well see more of this in the future, as the Canadian Securities Administrators are considering a proposal on advisor obligations to clients," said Smith. "Wealth management firms should really take a step beyond that though – listen to what clients are asking for, and deliver better transparency, integrated digital channels and a seamless experience that many new entrants are offering.”

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