The wealth management industry is digitizing at breakneck speed, while companies simultaneously seek improvements in customer experience, operational efficiency, and regulatory compliance: the right technology can create clear competitive advantages.
In this brief outlook, we share trends and challenges that we are witnessing in the wealth management market through interaction with our global customer base.
1. Intense Competition
Almost on a quarterly basis you could measure an increase in options for wealth management appearing on the landscape. Investors have an array of professional advisories from which to choose, each with a suite of technologies to capture goals, create plans, explore options, and monitor progress. In addition, online investing is addressing the younger generations’ preference for automation over human interaction. Collectively, this represents a challenge in the competitive landscape for legacy-minded advisors to attract and retain clients.
2. Rising Advisory Models Focused on Relationships
New levels of customer relationship management are becoming the norm, some involving the introduction of AI to drive pattern recognition and sentiment analysis among client interactions. Here, technology is playing an increasingly-pivotal role as an extension of advisor outreach and communication, helping not only to keep clients informed but to identify opportunities for strengthening trust, understanding, and support of client needs.
3. Fee Compression
Increased competition, combined with streamlined communication and the increased role of technology doing much of the reporting heavy lifting, has begun to commoditize certain aspects of wealth management, resulting in early trends in fee compression to remain competitive.
Businesses that are aligned to fully-embrace technologies early in this trend will be clear winners who gain margin and market share.
4. Zero, or Even Negative, Interest-Rate Market
The challenge of having investment portfolios with a return that both exceeds inflation and sustains the retirement for affluent investors and the value for high net worth and ultra-high net worth investors is huge. Finding and managing alternative assets portfolios with good risk/return is increasingly imperative.
5. Stricter Regulations
From a technology standpoint, stricter regulations imposed upon any business results in increased strain on processes and workflows to adhere to guidelines, maintain audit trails, produce complete reporting, and operate within constraints. Technology will continue to adapt in this area by enabling the consolidation of workflows throughout the company, and the emergence of true organizational intelligence and standardization—a clear benefit.
6. The New Generation of Digital-Savvy Clients
As Boomers give way to Gen X and Millennials, a clear transformation is taking place in ease and comfort-level with technologies in driving communication, collaboration, decision-making, strategy, and reporting. Along with staying connected 24x7, younger investors are increasingly expecting reports to be available (literally) in hand, available on cross-platform devices, on demand, and updated at all times. This capability is no longer a feature, but the new norm and a must-have to survive in 2021+.
As 2021 takes shape, and the lessons learned in 2020 through suddenly migrating to online, distributed workforces and remote client communication continues, technology that is platform-independent, extensible, adaptable, connective, and leading edge will make the difference between leaders and laggards in wealth management.
BRITech has positioned its investment management solution to meet these rapidly evolving technology challenges, as an online enterprise solution that delivers both ready-deployed functionality and high customizability to fit the unique needs of each business. From portfolio management, to client dashboards and analytics, trade order management to billing, client relationship management to back office operations—BRITech’s solution activates quickly and seamlessly to deliver immediate improvement in efficiency, customer experience, and regulatory compliance.
For more information, please visit britech.global