Wealth Management Research Outlook 2023
THE FUTURE STATE OF WEALTH: TRANSITIONING TO A CLIENT-LED ENTERPRISE
In 2022 we outlined a vision for the wealth management industry which remains unchanged: Deliver personalized financial solutions at scale to all customer segments while also elevating the client experience.
To do this wealth managers must transition to a client-centric business model that focuses on client experience over product offerings. And, while this is not a new concept, few wealth managers have made the transition as it often requires dismantling monolithic legacy infrastructures and developing more modular, scalable platforms that enable differentiated value propositions for all client segments.
Wealth managers firms are now vulnerable to a wider array of competitors. For example, Fintechs have already changed the face of wealth by delivering personalized client engagement models, unbundling the wealth tech stack, and creating partnerships across the ecosystem. Banks and neo-banks are blending wealth and banking capabilities under the umbrella of “personal finances” in the race to become the hub for all things financial and Walmart is entering the fintech arena.
So, in 2023, the question is no longer what initiatives should wealth managers prioritize, but how to best execute them. Here we present the five core technology building blocks needed to create a new generation of wealth managers.
THE OUTLOOK FOR 2023
For Wealth Managers the next the next few years need to be about transforming to a client-led enterprise. Firms must overcome cultural and advisor inertia in an effort to prepare for a new generation of clients while not abandoning their core constituency.
Advisors are aging out, and investors want to transact differently. Firms must cater to a new generation of investors while continuing to service a more traditional customer base. Wealth managers must therefore meet clients where they live, regardless of asset strata, by engaging with them through different channels. Embracing a “digital-first strategy” is essential to delivering scalable, differentiated omni-channel solutions.
“Digital solutions will form the base layer to cater to more traditional, higher wealth bracket clients, who increasingly expect enhanced digital experiences along with traditional human-led bespoke service offerings. For many wealth managers, this will require significant change.” – Oliver Wyman
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