DIGITAL ENGAGEMENT & COLLABORATION - THE HYPE, THE REALITY AND THE FUTURE IN WEALTH AND INVESTMENT MANAGEMENT - Objectway
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DIGITAL ENGAGEMENT & COLLABORATION IN WEALTH AND INVESTMENT MANAGEMENT THE HYPE, THE REALITY AND THE FUTURE
TABLE OF CONTENTS
Preface........................................................................................................................................................3
Executive Summary...............................................................................................................................4
Focus on one of the Denmark’s leading Financial Services Group...........................5
Introduction..............................................................................................................................................6
Focus on Lemanik SA.................................................................................................................7
About the Survey...................................................................................................................................8
Focus on BNP Paribas Fortis Private Banking..................................................................9
General Characteristics of Opinion Leaders...............................................................................10
Digital Engagement and Collaboration........................................................................................14
Digital Strategy............................................................................................................................14
Online Investment Management...........................................................................................21
Case Study: CheBanca!.............................................................................................................24
Customer Experience................................................................................................................27
Case Study: Targobank.............................................................................................................30
Analytics.........................................................................................................................................32
Case Study: Nedbank................................................................................................................34
Social Media & Virtual Communities...................................................................................36
Conclusion and Takeaways.................................................................................................................38
Final Synopsis..........................................................................................................................................39
About the Authors.................................................................................................................................39
Follow up...................................................................................................................................................40
Webinar...........................................................................................................................................40
On-Demand Briefing Sessions................................................................................................40
Contacts.....................................................................................................................................................40
2
PREFACE
Efma and Objectway are delighted to present this
joint publication, based on a recent survey, “Digital
engagement and collaboration in wealth and
investment management: the hype, the reality and
the future”. The report explains and explores the
latest digital engagement and collaboration trends,
in terms of tackling challenges and leveraging
opportunities for the growth, management and
preservation of client wealth.
Two years ago, Objectway and Efma conducted a
joint survey: “Digitisation in practice: transforming
VINCENT BASTID - CEO, Efma
investment services for affluent clients”. This study
interviewed leading banks and wealth managers and
showed how firms were undertaking an integrated
digital strategy by examining five focal areas for
digitisation: customer centricity, channel interaction,
digital mobility, analytics and social media.
The results showed that wealth and investment
management services providers were recognising the
value of digitisation for improving customer centricity
and enhancing customer service. The clear trends
that emerged included an increasing use of analytics
and social media for learning more about clients,
new tools for simplifying access to investment data
and omnichannel integration for improving the
customer experience.
LUIGI MARCIANO - CEO, Objectway
In this year’s study, we focused on observing how
the wealth and investment management sector has
capitalised on digital engagement and collaboration
in relation to our first survey’s findings. Consequently,
we continued to focus on customer experience,
analytics and social media. We also carried out a
more in-depth investigation into digital strategy
and online investment management.
The focus on these last two key themes aims to
improve our understanding of the current digital
engagement challenge.
Furthermore we also explored the future evolution
of the industry’s digital strategy to try to understand
if and how firms are now leveraging digitalisation to
grow their business, improve operational efficiency
and boost productivity.
We hope that you will find this detailed analysis both
enjoyable and informative.
3
EXECUTIVE SUMMARY
Technology and digitalisation are radically transforming the wealth
management industry and are considerably challenging its value
proposition. Wealth Managers should think of clients in terms of
digital awareness and sophistication and should look into their need
for personalised investment advice, supported by proactive and
collaborative guidance.
In this demanding context, should firms re-engineer their business
models around the connected customer and deliver a differentiated
digital wealth experience? Could digital engagement and collaboration
tools meet evolving client expectations, reduce attrition and enhance
efficiency?
The results of our joint survey offer an insight into how digitally-
minded investors are approaching and will influence the approach
to wealth management in the coming years. As a foretaste, the main
findings of the study highlight that:
• Digital Engagement and Collaboration is considered to be a strategic topic, with
board level commitment. Most of the respondents also consider it to be a multi-year
programme, with a multi-year dedicated budget.
The participants in the survey are quite well equipped in terms of digital engagement
and collaboration capabilities. However, the current situation is more about reactive
data provisioning, with a clear evolution towards a proactive approach and from a
unidirectional to a bi-directional attitude.
• Redefining the Client Onboarding Process is a challenge for many financial services
organisations. Building a healthy customer relationship in a compliant and efficient way
is imperative and a greater reliance on a self-service approach could improve efficiency.
4FOCUS ON
• Online Investment Management is considered ONE OF THE
to be complementary to traditional service LEADING FINANCIAL
offerings, but is also an offensive strategic SERVICES GROUP
offering for entering new customer segments. DENMARK
The hybrid advisory model is likely to be the
winning approach for investment servicing.
• Although Customer Experience is the key
element of the new corporate identity, only
a third of respondents affirm to have a
real-time, consistent experience across all
channels. Security is not a limiting factor for
digital engagement and collaboration when
using relevant and appropriate technology.
• Analytics and Social Media are becoming
DIGITAL BEST PRACTICE
an integral part of a firm’s digital strategy. Digital Innovation as the key to the future
Over the next two years, they will become CHALLENGE
important tools for profiling and interacting To create “sticky” client relationships
in the digital word
with each client more effectively. Companies
will be able to develop the most appropriate
proposal by monitoring client life events,
mainly by capturing static data. “Digital engagement and collaboration
between the financial institution and the
These are among the main themes that this client is a fundamental topic because of
study will explore to increase our understanding the demand generated by increasingly
of the current digital engagement challenge in informed customers. They are looking
an increasingly competitive context. for easy ways to connect and to be
educated, aiming to save time and money,
seeking transparency from their financial
institutions and expecting experiences
that fit into their everyday life. There
are also important drivers related to the
organisation’s needs - such as saving costs
and raising competiveness via automation,
reducing errors and delays from manual
processes, gaining control, freeing up
resources for more timely financial
analysis, drastically decreasing the burden
of compliance and using a self-service
approach by reducing administrative tasks
from the professionals and providing an
‘at your leisure’ service to clients.”
“The need for action is acute, especially
in today’s environment, as it has become
crucial to create sticky client relationships
in the digital world. Banks have only a short
period of time to become digitally proficient.
If they fail to take action, they risk losing
their competitive edge. Revenues and profits
will increasingly migrate towards banks
that successfully use digital technologies to
automate processes, create new products,
improve regulatory compliance and transform
the experiences of their customers.”
5
5INTRODUCTION
Wealth firms are feeling pressurised to implement a digital wealth
management strategy and various factors contribute to this. However, the
competitive advantage that digitalisation can provide also leads to business
growth. This includes delivering concrete benefits for both investors and
wealth professionals. To achieve this, financial institutions must manage
their customer experience, data analysis and business processes in a
digitally integrated way.
What are the major trends and challenges that should be considered for
technological investments in digital transformation?
THE CONNECTED CUSTOMER THE IMPORTANCE OF CUSTOMER
EXPERIENCE
To rise to the challenge of engaging the
digitally-minded client, firms need to re-engineer When engaging with a financial institution, a
their business models around the connected potential client’s first impression of the wealth
customer. According to many research firm will come from their customer experience.
studies, the top reasons cited by investors for This will form the lynchpin of the corporate
switching to another financial advisor are all identity of the future. Clients expect leading-
communications-related: for instance, advisors edge technology when dealing with their
do not return clients’ requests in a timely manner financial institution and advisor. A personalised
and are not proactive in providing advice. user experience is considered key to business
Today’s connected clients want access to their growth, and is one of the top elements in the
advisor on their own terms, using the channel future evolution of digital engagement and
with which they are most comfortable. collaboration.
CLIENT ONBOARDING
REGULATORY REQUIREMENTS TRANFORMATION
Regulatory requirements represent a major The use of digital tools to engage and
driver for IT spending, particularly in relation collaborate with the client is transforming the
to the application of rules based on the onboarding process into a revenue function,
forthcoming MiFID II regulation. This, along with a strategic impact on a firm’s business.
with the control of the appropriateness of the Identification of the client’s risk level and the
investment, implies that every order received via standardisation of processes are key to ensuring
a recordable electronic communication channel constant compliance. Furthermore, the client
is considered valid and needs to be recorded. experience can be enhanced if the onboarding
Therefore, companies should take all of the process is fast and of a high level quality.
digital steps needed to prevent employees or Finally, the ‘straight through processing’
contractors from having private communications of onboarding can improve organisational
that the company is unable to record or copy. efficiency and keep customer loyalty high.
6FOCUS ON
HYBRID ADVISORY AND
GOAL-BASED INVESTING
SWITZERLAND
Digitally-empowered clients tend to require a
complementary approach to financial advice: a hybrid
approach that combines human interaction with
digital capabilities. Investors can start their investment
experience with a robo advisor, and can then consult a
human advisor for investment decisions through safe
chat, video or co-browsing tools. Goal-based financial
planning increases the effectiveness of the investment
strategy through constant portfolio monitoring and
rebalancing.
This study explores how financial institutions are using
DIGITAL BEST PRACTICE
digital technology to overcome these challenges and Digital transformation as a natural transition
add value to their clients in wealth and investment
CHALLENGE TO OVERCOME
management services. Improve the investment experience
through algorithms
STRUCTURE OF THE REPORT
The findings presented in this report are divided into “The face-to-face approach continues
two categories: general/demographic information about to be a fundamental interaction for our
the survey respondents and a detailed discussion and private clients; on the other hand, we are
analysis of digital engagement and collaboration trends also aware that our customers often travel
and are not always resident in Switzerland
in the wealth and investment management segment.
or Luxembourg where Portfolio Managers
are based. In these cases, face-to-face
Interspersed with the results are case studies and
interaction cannot be easily satisfied
quotes that highlight the strategies, best practices and
without a digital support. In this, we
challenges reported by selected survey participants in a
see digital transformation as a natural
series of drill-down interviews. transition.”
“We continue investing on innovation,
WHY WE UNDERTOOK THIS STUDY which is mainly focused on algorithms.
Our algorithms support the automated
Two years ago, Objectway and Efma conducted a joint
advice model, where quantitative advanced
study, called “Digitisation in practice: transforming analytics are used for the construction of
investment services for affluent clients.” This involved model portfolios and product picking, at a
interviews with leading banks and wealth managers lower cost. The algorithms follow the rules
and explored how firms were undertaking an integrated set by the portfolio managers and perform
digital strategy. theirs visions in the most automated
way. The combination of a good quality
In this year’s edition of the survey, “Digital engagement engine and the precise inputs given by the
and collaboration in wealth and investment portfolio managers differentiate us from
management: the hype, the reality and the future”, we competitors.”
have focused on observing how the wealth and
investment management sector has capitalised on Marco Silvani
digital engagement and collaboration in relation to Managing Director
Lemanik SA
our first survey’s findings.
As a result of this study, we can now enrich our view
by adding new aspects, calibrating industry vision,
monitoring its evolution and offering a glimpse of the
years to come.
7
7ABOUT THE SURVEY
The main objective of the joint Efma and Objectway study is to observe
and explore the latest digital engagement and collaboration trends,
in terms of tackling challenges and leveraging opportunities for the
growth, management and preservation of client wealth. The results of
the study enable us to identify the best practices for transforming the
client experience whilst complying with regulations and safeguarding
the operational efficiency of an organisation.
The survey consisted of three phases:
• Workshop phase: An initial in-house workshop phase involving Objectway and Efma, including a
preliminary desk study, set up to analyse and understand the most important scenarios within the
wealth management market.
• Questionnaire: The workshop findings provided source material with which to prepare the
extended research phase. This involved an online questionnaire, with over 2,000 financial
institutions being contacted.
• Interviews: Some of these respondents were selected for interviews. We chose those that had
adopted particularly interesting approaches and conducted in-depth qualitative interviews with
them, to gain a better understanding of their future plans.
Here are the financial services providers that shared their digitalisation plans and strategies in the
interview phase:
• CheBanca! - Italy
• Nedbank – South Africa
• Targobank – Germany
• Lemanik SA - Switzerland
• BNP Paribas Fortis Private Banking - Belgium
• One of the leading Financial Services Groups - Denmark
8FOCUS ON
METHODOLOGY
The extended survey was based on a semi-
structured questionnaire containing 22 questions
(a mix of pre-coded and open-ended questions)
BELGIUM
and lasting approximately 15 minutes. The
questionnaire was developed by Objectway and
sent by Efma to its member banks via computer-
assisted web interviews, with over 2,000 financial
institutions being contacted.
PARTICIPANT ROLES
AND JOB TITLES
Managers from the marketing, business and
development areas were surveyed in their
institution’s head offices. They included executives
in the following roles: Head of Private Banking, DIGITAL BEST PRACTICE
Human & Digital Interaction
Head of Affluent Banking, Head of Investment
CHALLENGE
Management, Chief Operating Officer, Chief
To retain a competitive edge within a
Marketing Officer, Innovation Manager, Head of digital world
Direct Channels, Head of Digital Strategy, Head
of Business Development, Head of Customer
Experience.
“We believe that most customers
value human interaction above all
other forms of contact. However,
today the relationship between the
financial institution and its clients must
be digitally facilitated, whilst being
complementary to the face-to-face
approach: the two should go hand-in-
hand. In the private banking segment,
digital can support and enhance the
personal relationship.”
“Today, digital engagement and
collaboration is quickly becoming
the norm: it is a qualifier and a ‘must-
have’ within financial institutions.
Therefore, for banks and other financial
institutions, it is becoming harder to
differentiate themselves through their
digital offering. This means that the
window of opportunity becomes smaller
and smaller and it is more difficult to
maintain the differentiating advantage
in the long term.”
Jeroen Machielsen
Segment Manager Private Banking
BNP Paribas Fortis Private Banking
9GENERAL CHARACTERISTICS
OF OPINION LEADERS
This section provides general information about the financial
institutions that are opinion leaders and that took part in the study.
These details include country location as well demographic information
on their investment services, such as geographic focus, assets under
management, and number of clients per advisor.
GEOGRAPHICAL RELEVANCE
The sample of opinion leaders was representative of the countries of greatest interest in relation to the
topics examined. It was well distributed and therefore offered a good coverage of the market mix.
The following chart shows the 27 countries where the financial institutions, that took part in the
study, are located.
27
COUNTRIES
REPRESENTED
IN SURVEY
• AUSTRIA • EGYPT • IRELAND • POLAND • SWITZERLAND
• BELGIUM • FINLAND • ISLE OF MAN • PORTUGAL • UNITED
• CANADA • FRANCE • ITALY • RUSSIA KINGDOM
• CZECH • GERMANY • LUXEMBOURG • SOUTH AFRICA • UNITED ARAB
REPUBLIC EMIRATES
• GHANA • MOROCCO • SPAIN
• DENMARK • ZAMBIA
• GREECE • NETHERLANDS • SWEDEN
10AFFLUENT AND HNW INVESTMENT SERVICES:
CLIENT SEGMENTS, AUM AND CLIENTS PER ADVISOR
The following charts focus on the main client segments served by the surveyed financial institutions:
the organisation’s assets under management (AUM) of HNW/affluent clients and the average
number of clients per advisor. We also investigated whether investment services to affluent and
HNW clients are considered to be a core service offering.
FIGURE 1 | CLIENT SEGMENTS
WHAT ARE YOUR MAIN CLIENT SEGMENTS?
AFFLUENT CLIENTS
19%
HNW CLIENTS
21%
BOTH
60%
HIGHLIGHTS
Most of the surveyed financial institutions (60%) are serving both affluent and HNW clients.
There are also huge differences in assets under management, as shown in the chart below.
FIGURE 2 | ASSETS UNDER MANAGEMENT
WHAT ARE YOUR ORGANISATION’S ASSETS UNDER MANAGEMENT?
MORE THAN US$50BN
19%
US$20-50BN
9%
US$10-20BN
12%
US$5-10BN
12%
US$1-5BN
16%
LESS THAN US$1BN
6%
DON'T KNOW
26%
HIGHLIGHTS
Financial institutions providing investment services for the affluent and HNW market
vary in size from small to very large. Our study provides insights from across this broad
AUM range and is truly representative of a complete cross-section of wealth and
investment management.
N.B. The opinion leaders consulted include individuals who, for reasons of corporate policy or
because they work in more technical areas, preferred not to disclose precise figures for assets.
11FIGURE 3 | INVESTMENT SERVICES
ARE INVESTMENT SERVICES TO YOUR CLIENTS A CORE SERVICE
OFFERING OF YOUR ORGANISATION?
AFFLUENT CLIENTS
LONG-TIME EXISTING OFFERING
71%
JUST STARTED OFFERING
14%
UNDER DEVELOPMENT
10%
NOT CURRENTLY IN SCOPE
5%
HNW CLIENTS
LONG-TIME EXISTING OFFERING
90%
UNDER DEVELOPMENT
5%
NOT CURRENTLY IN SCOPE
5%
HIGHLIGHTS
Investment services to affluent and HNW clients are considered a core service offering and in
both cases they have existed as an offering for a long time. However, for affluent clients, 14% of
the respondents express that the offering has just started, which would certainly explains the
constant growth of digitalisation.
12FIGURE 4 | NUMBER OF CLIENTS PER ADVISOR
WHAT IS THE AVERAGE NUMBER OF CLIENTS PER ADVISOR IN YOUR ORGANISATION?
AFFLUENT CLIENTS
MORE THAN 2000
5%
1001-2000
10%
501-1000
5%
301-500
24%
201-300
24%
101-200
24%
LESS THAN 100
5%
DON'T KNOW
5%
HNW CLIENTS
501-1000
5%
201-300
5%
101-200
45%
LESS THAN 100
45%
HIGHLIGHTS
On average, the institutions surveyed said that each advisor handles around 350 affluent
clients, whilst the comparative figure for HNW clients is around 100 clients per advisor.
13DIGITAL ENGAGEMENT
AND COLLABORATION
Wealth and investment management is all about relationships and
service. This means being able to collaborate and share information
anytime, anywhere, by overcoming the traditional limits of physical
encounters.
Always-on connectivity is ubiquitous. Clients use multiple devices
to access the overwhelming amount of information that is at their
disposal. They want to find what is valuable to them in the shortest
possible time. It is therefore of paramount importance that the advisor
and the firm can engage in processes and collaborate with their clients
to improve the customer experience and to enable them to access
services in the most simple, natural and context-aware way.
DIGITAL STRATEGY
Today’s investors - at least, those that are growing - are different. They use social media to
support them to make financial decisions, they watch financial videos on YouTube and often
prefer to video-chat rather than meet their financial advisor in person. They also expect
leading-edge technology when engaging with their financial institution and advisor.
Are advisors and firms ready to rise to this challenge and deliver a differentiated digital
wealth experience?
14FIGURE 5 | DIGITAL STRATEGY
WHAT IS YOUR ORGANISATIONAL STRATEGY IN RELATION TO
DIGITAL ENGAGEMENT AND COLLABORATION?
46%
A BOARD LEVEL COMMITMENT
WITH A STRATEGIC FOCUS
22%
A MULTI-YEAR PROGRAMME
WITH A MULTI-YEAR BUDGET
15%
AD-HOC INITIATIVES
12%
A PROJECT, WITH A
DEDICATED BUDGET
2%
THERE IS NONE
2%
DON'T KNOW
HIGHLIGHTS
Digital engagement and collaboration is considered a strategic topic, with board level
commitment. Most of the respondents also consider it to be a multi-year programme,
with a multi-year dedicated budget. In fact, the statistics demonstrate that 90% of the
institutions are working on it.
15FIGURE 6 | DIGITAL ENGAGEMENT
WHO ASKS FOR DIGITAL ENGAGEMENT AND COLLABORATION?
AFFLUENT CLIENTS 5%
ALL CUSTOMERS
11%
FINANCIAL INSTITUTION IS
PUSHING THIS TO THE CUSTOMERS
16%
MINORITY OF CUSTOMERS
IN SPECIFIC SEGMENTS
21%
MINORITY OF CUSTOMERS
ACROSS ALL SEGMENTS
47%
MAJORITY OF CUSTOMERS
HNW CLIENTS 6%
DON’T KNOW
11%
DIGITAL ENGAGEMENT IS NOT
THE MAINSTREAM INTERACTION
APPROACH AT ALL
28%
MAJORITY OF CUSTOMERS
33% 22%
MINORITY OF CUSTOMERS MINORITY OF CUSTOMERS
ACROSS ALL SEGMENTS IN SPECIFIC SEGMENTS
HIGHLIGHTS
In the affluent segment, 47% of the respondents affirm that digital engagement is considered
to be the mainstream interaction approach for most customers, enabling them to manage a
large number of clients per advisor.
In the HNW segment, a smaller percentage of customers seek digital engagement and
collaboration tools, but financial institutions are sometimes improving their digital capabilities
to address specific target needs (i.e. millennials).
16FIGURE 7 | CHANNEL IMPORTANCE
RANK THE CHANNELS THAT YOU CURRENTLY USE FOR INTERACTING
WITH YOUR CLIENTS
1° BRANCH-BASED ADVISOR
2° MOBILE ADVISOR
3° INTERNET
4° REMOTE MEETING ADVISOR
5° MOBILE
6° AGENT OR INTERMEDIARY
HIGHLIGHTS
The respondents’ preferences show that a hybrid and complementary approach is required:
a branch-based advisor with a face-to-face approach is needed for the most sensitive issues,
whilst remote support with digital collaboration opportunities ensures immediacy, connectivity
and ubiquity.
17FIGURE 8 | DIGITAL CAPABILITIES
WHAT ARE YOUR MAIN DIGITAL ENGAGEMENT AND COLLABORATION CAPABILITIES?
MULTIPLE CHOICE ALLOWED
35% ONLINE RECOMMENDATIONS
45%
44% CHAT 44%
40% VIDEO 41%
27% CO-BROWSING
37%
29% ACTIONABLE SOFT REPORTING 34%
33% WEBCAST 29%
42% MARKET INTELLIGENCE 28%
49% DOCUMENT INPUT & OUTPUT
26%
33% ONLINE CALENDAR & CONTACT FEATURES 24%
19% ELECTIVE CORPORATE ACTIONS 22%
26% TASK MANAGEMENT 16%
HIGHLIGHTS
The participants in the survey are quite well-equipped in terms of digital engagement
and collaboration capabilities, and are willing to enhance these further. This suggests that
wealth and investment firms will opt for a tailored mix of digital features for engagement
and collaboration, rather than for one prevalent tool.
However, the current situation is more about reactive data provisioning, with a clear evolution
towards a more proactive approach (online recommendations) over time, and from a
unidirectional to bi-directional attitude (co-browsing) over the next two years.
Interaction is considered pivotal.
18FIGURE 9 | LOOKING TO THE FUTURE
WHAT ARE THE MOST IMPORTANT FUTURE ELEMENTS
OF DIGITAL ENGAGEMENT AND COLLABORATION?
1° DEEP PERSONALISATION
2° BEHAVIOURAL ANALYSIS OF YOUR CLIENTS
ACCESS TO DEDICATED TOOLS
3° quantitative tools, calculators, personal financial
management, back-testing, screeners, projections
4° VIRTUAL PERSONAL ASSISTANT
5° SOCIAL MEDIA INTEGRATION & INTERACTION
6° THEMATIC VIRTUAL COMMUNITIES
HIGHLIGHTS
7° SHERPA APPROACH
learn by watching over the shoulder of a professional
A greater personalisation
of the user experience,
behavioural analysis, access
to dedicated tools and a
8° COLLABORATIVE APPROACHES
share insights, earn recognition
virtual personal assistant are
quoted as the top elements in
the future evolution of digital
engagement and collaboration.
ACCESS TO BROAD MARKET INTELLIGENCE
9° news, fundamentals, corporate events, The opportunity to enable
instrument data, historic data
a differentiated customer
experience, based on the
organisation’s business and
10° PEER-GROUP ANALYSIS AND
COMPARATIVE BENCHMARKING
depending on the type of
client being served (such as
affluent and HNWI), will be key
to feeding business growth.
11° SELF-TRAINING, EDUCATION
AND ONLINE LEARNING
Being sufficiently distinctive to
provide new sources of value is
the main aspect.
19FIGURE 10 | INFORMATION AND EDUCATIONAL TOOLS
WHAT TYPES OF INFORMATION AND EDUCATIONAL TOOLS COULD BE RELEVANT
FOR YOUR DIGITAL STRATEGY? MULTIPLE CHOICE ALLOWED
MARKET REPORTS
80%
PERIODIC MACRO INFORMATION
77%
ONLINE EDUCATION AND TUTORIAL
70%
NEWS OF INTEREST
69%
ONLINE CERTIFICATION
28%
HIGHLIGHTS
All information and educational tools are almost equally relevant for building a digital strategy.
This is not surprising, as digital investors are more demanding in terms of accurate and
constant information about their investments. Moreover, a growing self-service approach fuels
the need for them to become more educated on financial matters and to collect information
from many different sources, including financial news portals, blogs, investor communities and
online automated investing services.
FIGURE 11 | SELF-SERVICE
IF A SELF-SERVICE APPROACH IS AN ESSENTIAL ELEMENT OF YOUR FUTURE DIGITAL
STRATEGY, FOR WHICH ASPECTS IS IT IMPORTANT? MULTIPLE CHOICE ALLOWED
ONBOARDING PROCESS
67% HIGHLIGHTS
TOOLS, SCREENERS, CALCULATORS,
A self-service approach is
PROJECTION TOOLS, SIMULATORS considered to be an essential
59% element in many areas: onboarding
RISK PROFILING AND REGULATORY QUESTIONNAIRES processes; tools and simulators; risk
55% profiling; regulatory questionnaires;
STANDING PAYMENTS/WITHDRAWALS and standing payments/withdrawals.
52%
The approach depends on the
FACT-FINDING respondents’ most urgent needs.
49% Most of all, redefining the client
KNOWLEDGE/TRAINING ON INVESTMENTS onboarding process is a challenge
44% for many financial services
ORDER CAPTURE organisations.
38%
Building a healthy customer
EDUCATION relationship in a compliant and
37%
efficient way is imperative, and
PEER-GROUP ANALYSIS relying on a self-service approach
25%
could improve efficiency. If self-
TAX HARVESTING service could be directly accessed
8% by the clients, once the data has
SELF-SERVICE APPROACH IS NOT STRATEGICALLY been collected, a clear investment
IMPORTANT AT ALL, MAYBE IN THE FUTURE strategy can be designed for them,
5%
which will eventually lead to an
account set-up process.
20ONLINE INVESTMENT MANAGEMENT
Investors are at the centre of the new digital workplace. A set of technologies and solutions enable
them to interact with services, contents, advisors, investment experts, helpdesk employees or other
fellow investors. A connected client is a new kind of client who needs access to advisors on his
own terms, at a time and through channels with which they are most comfortable, using safe online
investment tools.
FIGURE 12 | INVESTMENT MANAGEMENT
IS THERE AN ACTIVE MOVE TOWARDS ONLINE INVESTMENT MANAGEMENT?
21%
AS AN OFFENSIVE STRATEGIC
OFFERING TO ENTER NEW
CUSTOMER SEGMENTS
13%
NO ACTIVE INTEREST
13%
AS A SANDBOX / PLAYGROUND
10%
AS A DEFENSIVE STOP-GAP
OFFERING TO AVOID CUSTOMER ATTRITION
9%
AS A STAND-ALONE SERVICE
3%
31%
AS A COMPLEMENTARY OFFERING,
DON’T KNOW
NEXT TO TRADITIONAL ONES
HIGHLIGHTS
Online Investment Management does not replace the current capabilities: in fact, 31% of the
respondents see it as a complementary offering to traditional service offerings.
For a quarter of them, it represents an offensive strategic offering for entering new customer
segments. Only a small number of respondents don’t show any interest in it.
21FIGURE 13 | MARKET SEGMENTS
IS ONLINE INVESTMENT MANAGEMENT FOCUSED
ON A SPECIFIC PART OF THE MARKET?
MULTIPLE CHOICE ALLOWED
39% ACROSS THE FULL
WEALTH SCALE 50%
ONLY VALID FOR SOME
34% GENERATIONAL SEGMENTS 33%
ONLY VALID FOR CERTAIN
14% PORTFOLIO SIZES 28%
14% NO CLEAR OPINION 11%
HIGHLIGHTS
Online investment management isn’t seen by most respondents as being specifically
for a certain segment of customers (i.e. age, size) but potentially appeals across the
whole spectrum of clients.
22FIGURE 14 | ONLINE TOOLS
WHAT TYPE OF ONLINE INVESTMENT AND WEALTH MANAGEMENT
TOOLS ARE YOU OFFERING TO YOUR CLIENTS?
MULTIPLE CHOICE ALLOWED
8% HYBRID ADVISOR
45%
8% ROBO ADVISOR
52%
49% INVESTMENT PROPOSAL 42%
32% FINANCIAL PLANNING 39%
27% GOAL ANALYSIS 35%
37% RETIREMENT PLANNING TOOLS 32%
37% FAMILY BUDGET 32%
44% PTF MGMT & ALERTING TOOLS 39%
32% PRODUCT SCREENERS 28%
21% PROTECTION ANALYSIS 25%
14% FISCAL TOOLS 23%
HIGHLIGHTS
Many firms are thinking about how to position themselves in terms of online investment
management services, but not many are yet providing tools and services for this purpose.
The chart underlines the belief that in the next two years, an evolution from online investment
tools to online investment servicing will take place, with a strong surge in robo and hybrid
advisory as online investment solutions for the next future.
23CASE STUDY
CHEBANCA!
DIGITAL INNOVATION IN
ONLINE INVESTMENTS
The established Milanese investment bank, CheBanca!’s goal is to offer its customers a
CheBanca!, is offering customers a new concept native multichannel model which provides them
in banking by providing products that are with a few simple product offerings, a product
simple, safe and low-cost, and tailored to meet offer expansion, and an innovative
the needs of modern consumers. and distinctive advisory service.
To achieve this, CheBanca! has deployed a “To do so, we are focusing our efforts on
multi-year programme with a multi-year budget developing a totally digital and paperless
designed to make wealth management much platform for our advisory channel, with
more accessible and more client-oriented for customer behavioural analysis, a virtual
the mass affluent segment. It will also facilitate personal assistant, self-training, education and
money transfer from savings to investments for online learning, collaborative approaches that
its existing customers and will attract new ones include sharing insights and earning recognition
looking for an auto-investment experience at an etc. and last but not least, a peer-group analysis
affordable price. and comparative benchmarking.”
Digital engagement and collaboration is one
of the main interaction approaches requested BUILDING A NEW
by most CheBanca! customers. The digitally ADVISORY MODEL
affluent and next-generation customers value
this approach to satisfying their payment and The bank also aims to encourage existing
investment needs. “We have identified the traditional and conservative customers to
hybrid advisory model as the best fit for the move their assets from low-yielding cash
demand for consumer advice. It is also the most accounts and term investments to higher-
competitive one, as it combines best-of-breed yielding funds, equities and fixed-income
digital technologies and user experience with investments. It is providing the advisor
human interaction” says Alessandra Grendele, network with a platform to make high-quality
Director at CheBanca!. and tailor-made advisory solutions available.
24“We would also like to disintermediate some
steps of the onboarding, goal setting and
financial planning processes, by giving our KEY TAKEAWAYS
customers the freedom to choose if and
to what extent they want to operate by • CheBanca! has conquered the
themselves or to be assisted by any other market thanks to a simple, intuitive,
channel: branches, customer service, or and transparent product offerings,
advisors” explains Grendele.
and an innovative & distinctive
CheBanca! continues to invest in innovation advisory service
to meet its customers’ demands. The bank
offers a multichannel distribution model that • The bank has identified the hybrid
is geared towards maximum efficiency – advisory model as the best and
website, customer service and branches – and most competitive fit for the demand
relies on a customer-centric service with a
for consumer advice
distinctive offering: transparent, standardised
and price-efficient products.
“This gives us a distinctive business approach
that satisfies our clients’ needs, such as: Clients can use a robo advisor and then consult
savings, high standards of service and a human advisor for more complex investment
consummate professionalism. We can meet decisions. This will provide both the advisors
these demands by enhancing the banking and the customers with a unique experience of
business model - from IT systems to staff goal-based analysis and investment planning.
training and distribution - and by leveraging
the strategic opportunity offered by the rapid In conclusion, with Yellow Advice, CheBanca!
changes in the regulatory environment and wants all investors to have access to an advisory
the traditional customer-bank relationship” service which is currently reserved for private
points out Grendele. banks. This is unique, because it is simple,
personalised, monitored, multichannel and
To retain its competitive edge, CheBanca! is
threshold-affordable. In fact, the minimum
also deploying an offensive strategic offer
threshold to access the service, along with the
to enter new segments as well as providing
lower costs, make it a very democratic product
excellent capabilities, innovative technologies
that is available to a range of customers that
and competitive products and services.
have previously been neglected.
DISRUPTIVE HYBRID “We hope to bridge this gap by making the
ADVISORY PLATFORM investment world really affordable for everyone”
concludes Grendele.
“We are proud of having believed in the value of
selling investments online” affirms Grendele.
In January 2014, the bank started selling mutual
funds through an open-architecture model,
which later became an insurance product.
Today, it offers a disruptive, automated hybrid
advisory platform, combining human interaction
with digital capabilities.
25FIGURE 15 | LONG-TERM SWEET SPOT
WHAT DO YOU THINK WILL BE THE LONG-TERM SWEET SPOT OF ONLINE
INVESTMENT MANAGEMENT?
71%
HYBRID ADVISORY MODEL
15%
NO CLEAR OPINION
10%
AUTOMATED ROBO MODEL
3%
OTHER
1%
NOT REALLY LONG-TERM
VIABLE
HIGHLIGHTS
The use of these online investment tools and service offerings will change wealth managers’
business models. According to 71% of the respondents, the hybrid advisory model will
represent the winning approach for investment servicing. There is no ‘prototype client’ that
requests a totally automated or face-to-face contact: some clients prefer to be approached
online whilst others prefer a personal, face-to-face engagement.
Between these two extremes, financial institutions need to be able to support a wide variety
of approaches. This need could be satisfied by a hybrid approach that complements human
interaction with some digital capabilities. Investors can start online in a self-service model
and then request help from an advisor, typically for more complex or strategic investment
decisions, via the digital channel they prefer - asynchronously or in real time via safe chat,
video, co-browsing tools etc.
26CUSTOMER EXPERIENCE
Customer experience will become the key element of the corporate identity of the future. As everyone
pays attention to how branches are organised and how to approach clients in the physical branch most
effectively, the same level of attention should be given to how clients are approached in the digital
branch. The customer experience is a vital aspect of corporate identity and is a pivotal element in
attracting, retaining and inspiring customers.
Personalisation and the development of a specifically tailored service are considered key elements
for enabling future business growth, and are two of the main aspects of the future evolution of digital
engagement and collaboration.
FIGURE 16 | MONITORING CUSTOMER EXPERIENCE
IF CUSTOMER EXPERIENCE IS RATED AS STRATEGICALLY IMPORTANT WITHIN
YOUR ORGANISATION, HOW DO YOU MONITOR IT?
NET PROMOTOR SCORE TRACKING (NPS)
40%
REGULAR CUSTOMER SURVEYS
30%
CUSTOMER EXPERIENCE FOCUS-TEAM
12%
COMPETITIVE BENCHMARKING
10%
USABILITY LABS
4%
AGILE USER EXPERIENCE POLISHING
3%
OTHERS
1%
HIGHLIGHTS
Most of the respondents claim to periodically monitor customer experience in several ways: net
promotor score tracking (NPS), regular customer surveys, a customer experience focus team
and competitive benchmarking. Customer experience is the new competitive battlefield and
its monitoring is considered fundamental.
27FIGURE 17 | CUSTOMER LOYALTY
ARE CHANGES IN CUSTOMER LOYALTY EXPERIENCED IN A MAINLY DIGITAL
RELATIONSHIP VS. A MAINLY FACE-TO-FACE RELATIONSHIP?
DIGITAL RELATIONSHIP IS LESS LOYAL
33%
NO CLEAR OPINION
30%
IT COULD BE AN ISSUE
19%
NO (OR NON IMPORTANT) DIFFERENCE
15%
FACE-TO-FACE RELATIONSHIP IS LESS LOYAL
3%
HIGHLIGHTS
For more than half of the respondents, the digital relationship is an issue when it comes
to customer loyalty. How does a financial institution create a ‘sticky’ relationship with a
predominantly digital customer?
The top reasons cited by investors for switching to another financial advisor are all
communications-related: e.g. advisors do not return clients’ requests in a timely manner
and are not proactive in providing advice.
Additionally, when the digital process is not automated and is inefficient, clients could feel
that working with the firm is a tedious process and might decide to stop doing business with
that financial institution. Making digital engagement an enjoyable experience is therefore an
essential objective of the customer experience mantra.
28FIGURE 18 | CUSTOMER EXPERIENCE CONSISTENCY
IS YOUR DIGITAL INTERACTION REAL-TIME AND CONSISTENT
ACROSS ALL YOUR CHANNELS?
TWO YEARS AGO NOW
15% REAL-TIME & CONSISTENT
31%
18% NOT REAL-TIME BUT CONSISTENT 22%
48% NOT REAL-TIME & NOT CONSISTENT 36%
19% DON’T KNOW 11%
HIGHLIGHTS
The information provided by omnichannel and omni-device solutions needs to be consistent
and real-time across all channels. Two years ago, 48% of the respondents said that customer
experience was not consistent and was not real-time: this figure has now decreased to 36%.
Although customer experience is key to the new corporate identity, only 31% of respondents
claim to have a real-time and consistent experience across all channels. There is therefore still
a lot of efforts required to create a consistent omnichannel customer experience.
29CASE STUDY
TARGOBANK IMPROVES
THE CUSTOMER
EXPERIENCE FOR
THE DIGITAL CLIENT
In today’s world, online banking has almost CUSTOMER EXPERIENCE
become a commodity. However, 15 years CONSISTENCY
ago, when the Euro was making its first steps
across Europe, thinking about the creation Over the last three to five years, the growing
of an online banking service was quite demand for self-directed advisory services
revolutionary. TARGOBANK, the German retail has led to a new challenge for TARGOBANK:
banking arm of Crédit Mutuel, was an early providing its digitally-minded clients with
mover at that time. a hybrid journey, where they can start the
advisory process on mobile and then complete
The bank has understood the importance the mandate at the branch. They started
of having an online presence since the very delivering a robo advisory functionality -
beginning of the wave of online channel an online investment planner that is fully
integration into the banking ecosystem. consistent with the branch data - to give
This is why, as a ‘true omnichannel bank’, clients a quick view of an investment plan
TARGOBANK now offers Internet, mobile, (including ATR, asset allocation, quick
telephone and branch banking. With over 360 recommendations etc.) in a couple of steps.
locations across Germany, it provides personal
banking to private clients.
30In undertaking this effort, TARGOBANK’s
objective was clear: to improve the
KEY TAKEAWAYS
consistency and quality of the customer
experience across all channels, and to • TARGOBANK’s objective is to
optimise the costs of traditional face-to- improve the consistency and quality
face advice. Equally clear was the target
of customer experience across all
to serve customers with a minimum of
€50,000 investible assets. “This hybrid channels and to optimise the costs
segment now represents 25-30% of our of traditional face-to-face advice
customer base” says Juergen Lieberknecht,
Member of the Board and Head of • The delivery of a superb client
Marketing, Product and Sales. “Delivering experience to a very clearly focused
a superb client experience to a very clearly segment is a key aspect of turning a
focused segment was a key aspect of
project into a success
turning the project into a success.”
• Once a customer starts online,
In parallel, TARGOBANK is in the process of
it’s important that the first digital
delivering 30 more mobile banking services
that are already available on its Internet interaction stays consistent across
banking channel. “Once a customer starts all the channels and services
online, it’s important that the first digital offered by the bank
interaction stays consistent across all of the
channels and services offered by the bank.”
Furthermore, TARGOBANK plans to This includes the MiFID II compliance of digital
increase the automation of its banking communications: for example, tracing and
and wealth management services in areas archiving any advisory conversations using
such as KYC (know your customer) policy, features such as virtual meetings, video, chat,
reducing manual intervention, and making co-browsing, is a highly relevant element of
the robo advisor more sophisticated, with TARGOBANK’s agenda.
additional functions such as automatic
rebalancing.
How TARGOBANK dealt with legacy
constraints is exemplary. Integration with
legacy systems is often an obstacle to
digitisation. Consequently, in TARGOBANK,
“All of the digitisation hangs off our core
banking system, implemented with the
acquisition by Crédit Mutuel in 2008. That
was pivotal for the success of this project”
points out Lieberknecht.
Is there any challenge that this firm still
has to face? One, of course, is keeping up
with regulation. Because this effort could
be very costly, in the coming years dealing
with increasing compliance issues will
be crucial.
31FIGURE 19 | SECURITY
IS SECURITY SEEN AS AN OBSTACLE TO DIGITAL ENGAGEMENT
AND COLLABORATION IN YOUR ORGANISATION?
IT IS A CONCERN BUT WE ARE EQUIPPED WITH ROBUST TECHNOLOGY
56%
SECURITY LIMITS WHAT WE CAN DO IN THE DIGITAL AREA
26%
NO CLEAR OPINION
8%
NO IMPACT, NO CONCERN
6%
SECURITY INHIBITS OUR DIGITAL INITIATIVES
4%
HIGHLIGHTS
Security is not a limiting factor for digital engagement and collaboration when using relevant
and appropriate technology. It is a qualifier that is perceived to be under control.
ANALYTICS
Analytics offers a better way to listen to and understand client needs. Relevant information is
needed to grasp, profile and monitor customers’ behaviour. Combining information about client’s
lifetime events with the financial institution’s customer database offers a clear advantage for
providing differentiated and personalised services and experiences.
FIGURE 20 A | ANALYTICS TOOLS
HOW DO YOU USE ANALYTICS TOOLS WITHIN YOUR INVESTMENT SERVICES?
TWO YEARS AGO
USE ANALYTICS TO CAPTURE STATIC DATA
50%
USE THEM TO CAPTURE BEHAVIOURAL DATA
25%
DON’T KNOW
11%
DON’T USE ANALYTICS TOOLS
8%
ACTIVELY USE THEM TO TAILOR SERVICE TO CLIENT BEHAVIOUR
6%
32FIGURE 20 B | ANALYTICS TOOLS
HOW DO YOU USE ANALYTICS TOOLS WITHIN YOUR INVESTMENT SERVICES?
MULTIPLE CHOICE ALLOWED
NOW IN TWO
YEARS
35% TO EXTRACT LIFE EVENTS
OF THE CLIENT 44%
38% FOR PEER-GROUP COMPARISON 34%
TO TRAK DISCREPANCIES
34% OUTLIERS AND PATTERN CHANGES 34%
38% FOR SPENDING PATTERN ANALYSIS 31%
TO BETTER UNDERSTAND
69% THE CLIENT 28%
IT’S NOT USED TO IMPROVE
11% SERVICE OFFERING 4%
HIGHLIGHTS
In previous years, financial institutions have used analytics mainly to capture static data.
Today and in the near future, it will be used to extract relevant life events of the client.
A financial institution stores an incredible amount of valuable data about its clients, especially
when they start interacting more and more digitally.
This vast amount of customer behaviour information is typically untapped and hardly used.
However, it contains relevant data about clients that could support a bank to approach them
more effectively, according to their own specific ‘landing strip’.
33CASE STUDY
NEDBANK’S DATA
INTELLIGENCE FOR
PERSONALISED
INTERACTIONS WITH
CUSTOMERS
Nedbank is Africa’s most admired bank by DEEP CUSTOMISATION
all stakeholders: it is ambitious and strongly THROUGH DATA ANALYTICS
supported, as it strives to achieve digital
transformation. To achieve this goal, Nedbank is implementing
With more than €16 billion of assets under its new ‘single client portal’ to enable all clients
management and 7.7 million clients, it is one of to interact online with transactional banking
the top five banks on the continent. It provides and the wealth management aspects of their
insurance, asset management and wealth full banking offering. The digitisation trend, the
management solutions, as well as a wide range cost of face-to-face meetings, and customers
of wholesale and retail banking services. wanting to help themselves drove the bank
The bank operates in 39 countries across towards providing clients with a tailored digital
Africa, with a major presence in six countries interaction.
in the Southern African Development However, since there had not been a huge
Community (SADC) and East Africa1. uptake of online capabilities in the past, due to
In this region, it aims to put itself “ahead of tools that were too feature-rich and difficult to
the competition”, affirms Simon Marland, use, Nedbank embarked on this project with
Executive Head of Digital and Business ease-of-use as its focus. The bank therefore
Intelligence, Retail Client Engagement. adopted a three-step, scalable approach:
configuration, clustering, and personalisation.
1
Nedbank Group at 30 June 2016
34In the first phase, Nedbank created ‘digital
personas’, which define the default client
configuration of the banking app and portal. KEY TAKEAWAYS
These provide a default view of what a client sees
and can do on the app or portal. As an example, • Using Nedbank’s ‘single client
HNW investors would have a target-specific portal’, clients can interact online
configuration showing their brokerage account with all aspects of banking
and portfolios, whereas a pure retail client would
including wealth management
only have a view of their bank account.
as a one stop shop
Through these personas, the bank can
categorise which segments of clients are • Data and business intelligence are
more open to using digitally-enabled financial strategic for enabling the complete
services, and can then tailor their offering digitisation of the bank
to their clients’ preferences. Nedbank also
took into consideration their customers’ • Through the creation of ‘digital
negative feedback about complexity of use
personas’, Nedbank can segment its
and decided to cluster the available features
into functional grouped themed releases clients and tailor its offerings to suit
and send them out incrementally to clients, their preferences
accompanied by tutorial mediums on
how use them.
The ultimate stage is the delivery of a
personalised ‘single client portal’, enriched “Data and business intelligence are strategic
by one-to-one marketing actions, to provide for enabling the complete digitisation of the
an experience that is unique to each client. bank” concludes Marland. “Our empowerment
The key objective of the portal is to increase plan envisages the digitisation of a significant
each customer’s ‘stickiness’ to the Nedbank percentage of our business by 2020.”
brand through daily and easy use. “We aim
to offer a ‘golden nugget’ to our clients every
day” says Marland. This could be as simple as
‘your data needs updating’ or an offer based
on the client’s behaviour. “Personalisation will
be the key differentiator for Nedbank when
compared with our competitors” he adds.
When the new single client portal has been
released, “Nedbank will also rely on better
customer interaction data” says Marland.
The bank’s Data Warehouse, in fact, collects
a huge amount of information about its
customers’ financial activities. Using its
Interaction Management Engine to provide
a database of every client’s consolidated
interactions and touchpoints, the bank can
look at the client’s activity and behaviour on
the portal and can instantly push a product
offer as a pop-up through its ‘Offer Engine’.
35SOCIAL MEDIA & VIRTUAL COMMUNITIES
Social media in wealth and investment management is a controversial topic. However, the survey
results show that it is becoming more and more important to understand clients, interact with
them and offer them the solutions they expect. Moreover, for many respondents, a thematic virtual
community represents an opportunity for favourably positioning the organisation within relevant
public communities.
FIGURE 21 | SOCIAL MEDIA
IS THE USE OF SOCIAL MEDIA AN INTEGRAL PART OF YOUR DIGITAL STRATEGY?
NOW IN TWO
YEARS
3% TO FRAME AND UNDERSTAND
EACH CLIENT BETTER 31%
TO INTERACT WITH EACH CLIENT
11% ONE-TO-ONE 22%
TO INTERACT WITH OUR CLIENT
17% COMMUNITY AS A WHOLE 18%
48% AS A PUBLIC RELATIONSHIP TOOL 10%
19% NO, IT ISN’T 10%
2% DON’T KNOW 8%
HIGHLIGHTS
So far, social media is being used by nearly half of the institutions and often is not integrated
within the investment value chain. Over time, it’s becoming a more integral part of a firm’s
digital strategy and, over the next two years, it is perceived as becoming an important tool for
profiling and then interacting with each client according to his/her profile.
Social media provides the financial institution with a potential wealth of public information
about its clients. Harvesting and analysing the publicly available knowledge about clients,
or about a certain segment of clients, will become a more mainstream activity over the
coming years.
36FIGURE 22 | VIRTUAL COMMUNITIES
ARE THEMATIC VIRTUAL COMMUNITIES BECOMING AN OPPORTUNITY
OR A THREAT FOR YOUR INVESTMENT SERVICES?
24%
NO CLEAR OPINION
16%
NO IMPACT AT ALL
9%
THEY ARE A THREAT BECAUSE THEY
REDUCE OUR DIRECT IMPACT/INFLUENCE
ON A CUSTOMER
9%
THEY ARE AN OPPORTUNITY AND
THEY ARE IMPLEMENTED IN OUR OWN
CUSTOMER COMMUNITY
42%
THEY ARE AN OPPORTUNITY
TO POSITION THE ORGANISATION
FAVORABLY IN RELEVANT
PUBLIC COMMUNITIES
HIGHLIGHTS
For over half of the respondents a thematic virtual community is considered to be an
opportunity. It could help to position the organisation favourably in relevant public spaces
and 9% of the respondents argue that they have already implemented this in their own
customer community.
Enabling clients to interact with other members of their peer group can be seen as a
differentiator for an organisation. The client community can become part of the differentiated
and enjoyable customer experience that sets an institution apart.
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