Product innovation in European wealth management 2008

Published by: Datamonitor

Published: Jun. 16, 2008 - 161 Pages

Table of Contents

Overview

Catalyst

Summary

Methodology

Executive Summary

Investment in the development of new products and services provides a platform for attracting core target customer segments

Innovation is centered on online, value-added and capital-protected solutions

Over the next two years, property and private equity products will be given greater focus

Profitability is only a secondary driver of innovation

Leading wealth managers are making a greater effort to institutionalize customer-driven innovation

Table of Contents

Table of figures

Table of tables

Targeting Lucrative Customer Segments With New Products

Wealth managers have focused on launching new capital-protected investments and online services

Capital-protected investments and online services have been dominating product launch activity

Product launch priorities take the demands of the most important client segments into account

Wealth management service response: Providers need to align their product development strategies with the demands of the most lucrative customer segments

Tax planning and online services have broad appeal

New private equity investments and credit facilities will attract strong interest from business owners

Multi-faceted tax obligations make tax advice and new tax-efficient products a must for entrepreneurs

Entrepreneurs are on the lookout for new property investment opportunities

Activity in private equity and lending has been muted

Wealth management service response: The best banks for business owners will offer an expanded range of private equity and lending offerings

Wealth managers are targeting the retired wealthy with protected investments and estate planning

Capital-protected investments meet retirees' need for wealth preservation

Wealth transfer requirements call for tax-optimizing solutions

Wealth management service response: New offers aimed at retirees should focus on maximizing returns in a way that allows them to sustain their current lifestyle and provide for heirs

Wealthy women expect to be able to keep abreast of developments in their portfolios and access tax advice, but they also value support services and products for their philanthropic aspirations

Growing concern for social justice is prompting interest in charitable giving and socially-responsible investments

Wealth management service response: Wealth managers are expanding their portfolios of socially-responsible investments, as a core element of philanthropy and charitable services

Wealthy clients based overseas place emphasis on online portfolio management and cross-border tax services

Improved online functionality helps expatriates and inpatriates to stay in control of their investments while abroad

Wealth management service response: Online services from private banks and wealth managers allow clients to do more for themselves

Value-added services are primarily a complementary, but secondary proposition; however they may help to attract wealthy women and expats

New value-added services promise easier living at home or abroad

Wealth management service response: Third party providers allow wealth managers to provide the best of both worlds

Product and service development activity has been largely on target; however there is scope for greater attention to high-interest areas among entrepreneurs

Priority Areas For Innovation In Wealth Management

Innovation is centered on online, value-added and capital-protected solutions

Innovative enhancements of online functionality offer client benefits as well as cost efficiencies

Innovation in online services has been focused on enabling seamless international banking and wealth management

Wealth managers are also harnessing technology to improve the delivery of advice and service

Wealth management service response: Wealth managers targeting customers with international and online requirements must build their propositions around the concepts of one-world banking and access to premium information

Innovation in value-added services extends the client relationship beyond the investment portfolio

Value-added services are increasingly international in focus

Wealth management service response: Innovative value-added services must offer more than local access

Wealth managers are responding to client demand for predictability and protection with innovative capital-protected offers

New capital-protected investments for wealthy clients aim to provide greater protection and exposure to a wider range of underlying assets

Wealth management service response: Providers must be prepared to offer innovative solutions providing higher levels of protection or more diversified investment opportunities

Core products and services also offer scope for innovation and differentiation in service delivery

Future Trends In Product And Service Innovation

Over the next two years, property and private equity products will be given greater focus

The most attractive customer groups would welcome meaningful innovations from their wealth managers

Online services and capital-protected products top the list for future innovation

Future online services will attempt to empower clients more and more

Capital-protected investments will continue to harness new underlying assets

New value-added services will include more sophisticated advice for mass affluent clients and new complementary facilities related to property and art

New property investments will provide exposure to emerging markets

Inheritance planning advisory services will cater to the internationally mobile

Current market constraints provide strong incentive for building innovative and flexible private equity structures

Tax planning services will also be more internationally-focused

Emerging markets and hedge funds will also be high-priority areas

Profitability is only a secondary driver of innovation

Optimising innovative effort to appeal to core target customers groups may call for more emphasis on lending and charity/philanthropy services

New credit services will appeal to business owners

Wealthy women should be a key target of innovation in charity/philanthropy services

Leading wealth managers are making a greater effort to institutionalize customer-driven innovation

Wealth managers are leveraging their global scope and encouraging innovation

Appendix

Data

Definitions

HNW

Mass affluent

Methodology

Bibliography

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

List of Tables

Table 1: We have identified a number of areas where there may be a lot of product/service launches in wealth management. Please rate each area on the level of activity you are currently seeing (on average).

Table 2: We have identified a number of potentially lucrative customer segments in wealth management. Please rate each on its attractiveness as an area to focus on.

Table 3: Please indicate if there is ""a lot of demand"" from the following customer segments for the following products and services.

Table 4: We don't think that activity = innovation. So, in which areas are you seeing product/service innovation in wealth management? Please rate each area on the level of innovation you are currently seeing (on average).

Table 5: How would you rate each of the following segments on their receptiveness to innovative products (on average)?

Table 6: In which of these areas do you expect to see more innovation in the next 2 years?

List of Figures

Figure 1: Capital-protected investments register the highest number of new product launches

Figure 2: Business owners are the most attractive client group for European wealth managers

Figure 3: Tax planning and online services have broad appeal

Figure 4: Online services have been the focus of innovative effort

Figure 5: Entrepreneurs and business owners are most receptive to innovation

Figure 6: Over the next two years, wealth managers will focus most on innovations in online services and capital-protected products

Figure 7: Wealth managers may need to commit to greater innovation in philanthropy services and lending to appeal to women and business owners

Abstract

• Assesses product development priorities among European wealth managers;
• Highlights new product and service features and benefits;
• Identifies future areas of focus for product and service innovation.

• Benchmark your product development efforts against the offers of leading European wealth managers and private banks;
• Align new product development strategies to the characteristics and demands of some of the most lucrative customer segments;
• Gain insights into wealth managers' strategies for embedding innovation into their organisations.

About MarketResearch.com
MarketResearch.com is an online aggregator selling over 160,000 market research reports, company profiles and country profiles from over 600 research firms. Our reports will provide you with the critical business and competitive intelligence you need for strategic planning and marketing research. Coverage includes the US, UK, Europe, Asia and global markets.