Customer retention in wealth management 2009

Published by: Datamonitor

Published: Aug. 25, 2009 - 15 Pages

Table of Contents

DATAMONITOR VIEW

CATALYST

SUMMARY

ANALYSIS

Customer retention is a key strategic issue in the wealth management business today

Customer retention needs to be a defined business strategy

There are differing risks associated with HNWs leaving their wealth manager to manage their own money or to find another wealth manager

Wealth managers need to get to know their customers in order to improve retention

Wealth management service implication: HNWs are a diverse group and 'one size will not fit all'

Wealth managers need to understand the determinants of HNWs' choice of provider

Features of the wealth management firm outside of service most influence HNWs' choice of provider in both Europe and APAC

European wealth managers need to focus on the financial stability of the company

Wealth management service implication: Actively raise with clients their concerns about financial stability

A country specific analysis shows that Europe has a significant variation in choice of provider determinants

APAC wealth managers need to concentrate on raising the brand, image and reputation of their firm in the minds of HNW clients

A country specific analysis shows that there is a marked variation in choice of provider determinants

Wealth management service implication: Wealth managers can proactively enhance their level of personal service to help the image of the firm

Brand equity is important for the retention of customers in wealth management

Although the reputation of a firm dominates investors' concerns, service aspects of the wealth management business are also important to HNW clients

Wealth management service implication: Wealth managers should aim to raise the bar and educate clients more about investment matters

Innovative example from Switzerland: UBS is investing in educating its clients

In both Europe and APAC, wealth managers should be careful to give correct analysis and insight to retain their HNW clients

In the downturn, wealth managers know that they need to not make errors to retain their HNW clients

In both Europe and APAC, several points of client contact within the bank is also important to retain customers, as is resolving issues efficiently

Wealth management service implication: wealth managers can deliver superior returns by broadening their clients' horizons and holdings

Innovative example from the UK: HSBC hosts emerging markets investment seminar for its Premier customers

HNW clients are concerned about their portfolio performance

Wealth managers need to maintain frequent contact with their clients as they steer them towards new investment opportunities

Telephone contact is maintained more frequently in APAC than in Europe

Face to face contact is also maintained more frequently in APAC than in Europe

Wealth managers need to be innovative in their contact with clients to build a strong working relationship

To effectively retain clients, wealth managers need to really get to know their clients

There are regulatory requirements that necessitate wealth managers getting to know their clients

Getting to know clients goes beyond capture of data to support regulatory requirements

Innovative examples from around the globe where wealth managers create special events to get to know their clients better

The Private Banking and Wealth Management Australia conference

The Glenmede Trust uses common interests to bring current and potential clients together

APPENDIX

Methodology

Wealth Management Market Leaders Survey 2009

Bibliography

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

List of Tables

Table 1: Please rate your high net worth clients' characteristics

Table 2: What will determine HNWs' choice of wealth management service over the next 2 years?

Table 3: What is the best way to retain HNW clients today?

Table 4: When you speak with your HNW clients, what do they most want to discuss?

Table 5: How frequently on average do you have telephone contact with your HNW clients?

Table 6: How frequently on average do you have face to face contact with your HNW clients?

List of Figures

Figure 1: HNWs in APAC are more likely to leave their wealth manager to manage their own money

Figure 2: In Europe, German HNWs are most likely to leave to find another wealth manager and least likely to leave to manage their money on their own

Figure 3: In APAC, Hong Kong HNWs are most likely to leave their wealth manager to manage their money on their own and least likely to leave to find another wealth manager

Figure 4: Features of the wealth management firm external to service most influence HNWs' choice of provider in both Europe and APAC

Figure 5: In Europe, the financial stability of the company is the most important determinant of HNWs' choice of wealth manager

Figure 6: In Asia Pacific, the brand, image and reputation of the firm is the most important determinant of HNWs' choice of wealth manager

Figure 7: In both Europe and APAC, wealth managers should be careful to give correct analysis and insight to best retain HNW clients

Figure 8: Wealth managers in Europe need to ensure that they do not make errors in order to retain HNW clients

Figure 9: Wealth managers in APAC need to ensure that they resolve client problems as efficiently as possible

Figure 10: HNWs in Europe and Asia wish to talk with their wealth managers about portfolio performance

Figure 11: European HNWs are concerned about the performance of their portfolios and anxious about the future

Figure 12: HNW investors in APAC are concerned with the performance of their portfolios but are also looking for investment opportunities in the current market

Figure 13: Wealth managers in APAC are more likely to have weekly telephone contact with their HNW clients than their European counterparts

Figure 14: Wealth managers in Germany, Italy and France lead the way in Europe for weekly telephone contact with their HNW clients

Figure 15: Wealth managers in India, Hong Kong and Australia are more likely to have weekly telephone contact with their HNW clients than wealth managers in other APAC countries

Figure 16: Wealth managers in APAC are more likely to meet with their HNW clients on a monthly basis than is the case for their European counterparts

Figure 17: Quarterly meetings between wealth managers and HNW clients are most likely in Europe

Figure 18: APAC is divided between monthly and quarterly meetings between wealth managers and HNW clients

Abstract

• Compares HNW customer retention drivers across countries within Europe and countries within APAC.
• Identifies the key strategies for keeping clients through this downturn.
• Presents innovative customer retention strategies from wealth managers globally.

• Compares HNW customer retention drivers across countries within Europe and countries within APAC.
• Identifies the key strategies for keeping clients through this downturn.
• Presents innovative customer retention strategies from wealth managers globally.

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