Home Slider Digitisation and Affluent Clients: Integrated Digital Investment Strategies

Digitisation and Affluent Clients: Integrated Digital Investment Strategies

by internationalbanker

cuccu_alberto_coloriBy Alberto Cuccu, Chief Client Solution Officer, Objectway                                


Digitisation in practice: the story so far

Two years ago, Objectway and Efma conducted the joint survey “Digitisation in practice: transforming investment services for affluent clients”, interviewing leading banks and wealth managers to discover how firms were undertaking an integrated digital strategy by examining five digitisation focus areas: customer centricity, channel interaction, digital mobility, analytics and social media.

The results showed that wealth- and investment-management service providers were realising the value of digitisation for improving customer centricity and better serving their clients. The increasing use of analytics and social media for learning more about clients, tools for simplifying access to investment data and advice, and omnichannel integration for improving the customer experience emerged as clear trends in our findings.

Surprisingly, however, comparatively few affluent banks and investment firms viewed efficiency and productivity as equally important benefits or competitive advantages of adopting digital technologies. Indeed, the findings suggested that respondents associated digital technologies to a lesser degree with decreasing the cost of service and increasing the number of clients per advisor, margins per client and overall revenue.

Digital engagement and collaboration: current state and future evolution

In this year’s edition of the Objectway-Efma survey “Digital engagement and collaboration in wealth management: the hype, the reality and the future”, we focused on observing how the wealth- and investment-management sector has capitalized on digital engagement and collaboration with respect to our first survey’s findings. To this extent, we kept analyzing the focus areas of customer experience, analytics and social media, and deepened our investigation around digital strategy and online investment management. The focus on the latter key themes was aimed at better understanding the current digital-engagement challenge. We also explored the future evolution of the industry’s digital strategy to understand if, and how, firms are now leveraging on digitisation to grow their businesses, and improve operational efficiency and productivity.

The context

Opinion-leading financial institutions from 27 countries across the world took part in the study, thus offering a representative coverage of the countries of greatest interest with respect to the topics examined. 


Most of the surveyed financial institutions (60 percent) are serving both affluent and private clients, with a composite situation in assets under management. (Regarding the “don’t know” answer—the opinion leaders consulted included individuals who for reasons of corporate policy or because they work in more technical areas, such as innovation and development, preferred not to disclose precise asset figures.) 


This adds significance to the survey results, as this means that the emerging trends are affecting the whole scope of the market, from small- to big-sized businesses.

The study results

The first key finding regards the place that digitisation has had in financial institutions’ investments. Nearly half of respondents considered digital engagement and collaboration to be a strategic topic with board-level commitment, and 90 percent of them were working on it.

This could be interpreted as a natural consequence of today’s investors’ behaviors: they use social media to help make financial decisions, watch financial videos on YouTube and often prefer to video chat rather than meet their financial advisors in person. Clients expect leading-edge technology when dealing with their financial institutions and advisors.

Accordingly, firms have started using multiple channels to interact with their affluent and private clients. The respondents’ answers show that a complementary approach is preferred: a branch-based advisor with a face-to-face approach for the most sensitive themes is perceived as a commodity, while remote support with digital-collaboration capabilities assures immediacy, connectivity and ubiquity.

In terms of digital engagement and collaboration tools (such as document management, webcast, task management, video and chat), the surveyed panel was quite well-equipped and willing to further enhance them. However, the current situation is more about reactive data provisioning, with a clear evolution to a proactive approach by using online recommendations (+10 percent) and from a unidirectional to bidirectional attitude through co-browsing facilities (+10 percent) in the next two years. Interaction is considered pivotal. 

fig-3_digital-strategy_in2years fig-3_digital-strategy_now

So what are the most important objectives when implementing these digital engagement and collaboration tools? The top aspects that emerged were user experience, deep personalisation, behavioral analysis, access to dedicated tools and virtual personal assistant. This means that the opportunity to enable a differentiated customer experience, based on the organization’s business and depending on the type of client served, will be key to feeding business growth and providing new sources of value.

Despite its claimed importance, since customer experience can be considered as the new corporate identity, only 31.4 percent of respondents affirmed having a real-time and consistent experience across all channels. This discrepancy between the asserted prominence and the real implementation of a consistent customer experience needs to be solved in the short-term—especially considering that for more than half of the respondents, digital relationship was an issue when it came to customer loyalty.

Another relevant aspect with which wealth and investment firms will have to deal is the growing demand for a self-service approach to investments from digital investors. The survey results show that it can be exploited for several purposes (tools and simulators, risk profiling, regulatory questionnaires), but especially for the client-onboarding process (67 percent). Redefining this process is a challenge for many organisations, since they have to keep consistency, efficiency and compliance across any step and at any point of contact. Once the data collection is conducted directly by the client, relying on a self-service approach could improve efficiency, do management by exceptions and save time for added-value advisory activity.

Similarly, respondents understood the need to integrate online investment services into their traditional offering: 31.4 percent of them viewed online investment as being complementary to traditional service, while for a quarter of them it represented an offensive strategic offering to enter new customer segments.

An interesting finding emerged regarding the market segments to which financial institutions are thinking of addressing their online investment offerings: while today it is seen by most respondents as not specific to a certain segment of customers, it will potentially appeal to the whole spectrum of clients in two years. This demonstrates that traditional boundaries in terms of services dedicated to certain types of clients are quickly collapsing.

Firms are actually thinking about how to position themselves in online investment management, but only a few are already providing tools and services for this purpose. In the next two years, an evolution from investment tools to investment servicing will take place, with a strong interest in robo- and hybrid-advisory solutions. The hybrid approach complements human interaction with digital capabilities, enabling investors to access their advisor in the digital manner they prefer, asynchronously or in real time via safe chat, video, co-browsing tools and so on. The hybrid-advisory model will represent the winning approach to investment servicing. 



When it comes to customised services, analytics and social media are the most appropriate tools to achieve a deep knowledge of investors. In our first survey, we discovered that financial institutions were using analytics mainly to capture static data. Nowadays and in the near future, it will be used to better understand clients and to extract relevant life events from the huge amounts of clients’ behavioral information, in order to address the most appropriate proposals.
So far, nearly half of the institutions have used social media, but often without integration into the investment value chain. Analyzing the publicly available knowledge about clients to frame and interact with each client will become more mainstream over the coming years. Thematic virtual communities providing the ability to clients to interact with other investor members could represent a further opportunity to position the organization favorably and to differentiate it from the competition.


According to these study findings, digital engagement and collaboration enable financial institutions to combine a tailored service based on the firm’s specific business with an operationally efficient processing and operation management. All the aspects described above are ingredients to gradually establish a mass-customised business model over the coming years.


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