How to cover a wide number of clients efficiently without losing a personal touch? The answer, so a common argument goes, is to use digital technology to customise offerings that suit specific clients. A report from a major data and business information group sheds more light on the topic.

A survey of more than 1,500 self-directed and advised investors around the world – including high net worth individuals – found that wealth managers must personalise services by using digital technology if they want to beat competition.

Some 64 per cent of Millennials and 51 per cent in the 35-54 age bracket are willing to pay more for personalised investment products and services. The levels are highest in Latin America (70 per cent), followed by Asia-Pacific (47 per cent), Europe (33 per cent), and North America brings up the rear – perhaps surprisingly (22 per cent).

The numbers, which were collated by Refinitiv, an LSEG Business and market data firm, were released in its new Wealth Management report entitled Getting Personal: How wealth firms can attract and retain the modern investor.

The stakes for achieving effective personsalisation are high as firms such as UBS push into the mass-affluent space in the US, a market where the use of digital technology in “robo advisor” platforms and the like is essential for achieving profitable economies of scale. Technology, so the industry hopes, enables firms to give clients a personal service without carrying a heavy workforce. (The recent UBS purchase of Wealthfront is an example of how big banks are trying to target the mass-affluent/parts of the HNW space.)

Those questioned for the report came from 13 countries: Australia, Brazil, Canada, China, France/Monaco, Germany, Hong Kong, Japan, Mexico, Singapore, Switzerland, the UK and US.

“Today’s consumers have grown not only to appreciate, but to expect the ‘know me’ experience from the companies with whom they choose to interact. It’s no surprise they would expect the same level of personalisation when it comes to their investments. Financial advisors are waking up to this notion and actively evolving their offer, but as this study underscores, there is lots of work – and opportunity – still ahead,” April Rudin, chief executive, The Rudin Group, said. (Rudin is also a member of Family Wealth Report’s editorial advisory board.)

The report’s authors said the study also showed that 58 per cent of advisor-led investors and 62 per cent of hybrid advisor and self-directed clients state “advisor recommendations” as the most reliable source of information. Separately, 51 per cent of investors globally are familiar with sustainable investments, and 32 per cent of Millennials think tokenized assets will have the biggest positive impact on financial markets, followed by 23 per cent for non-fungible tokens (NFT).

“As investor needs continue to change and reflect new ways of investing and doing business, so too must those of financial advisors to retain clients and grow their business. Our report makes clear what those key investor expectations are and what financial advisors need to do to inspire confidence: provide a broader range of digital capabilities, personalised products and services, and alternative investment opportunities,” Sabrina Bailey, global head of wealth, data and analytics, LSEG, said. 

William Trout, director of wealth management, Javelin Strategy & Research, said of the report’s findings: “The rise of next-best-action and direct-indexing tools point to investor yearning for personalised service and proactive engagement from the financial advisor.”

Refinitiv has launched a range of wealth management offerings in the past couple of years. See an example.