Fintech on Friday: Using data to personalise the client experience
Whether sharing information with online travel services, search engines or dating apps, consumers are increasingly comfortable handing over personal data to secure a service, product or outcome tailored to their needs.
Here we examine five actions wealth management firms can deploy to enhance the client experience by using data to personalise their client interactions:
1. Invite clients to share data in new ways – but demonstrate that it is secure
Received wisdom in wealth management says clients are only comfortable handing over sensitive information if it is in person to someone they know and trust. But our research indicates a willingness to try new data-sharing channels if such interchanges can deliver a more personalised service.
This openness to sharing information is wholly contingent on clients feeling assured that their data is safe. Currently, more than half (52 per cent) of investors are confident firms will keep their data protected.
2. Design information delivery that has personal impact
Many wealth management propositions sell themselves on their highly bespoke service. But from the client’s perspective,
the personalisation principle is not yet being applied to investor insight.
Across the board, investors are struggling to see the relevance of many of the insights sent to them. Only around a third of clients feel information is sufficiently tailored. This suggests many firms need to review their content generation – and map it against what they know about clients – to provide insight that is tailored to and actionable by individual investors.
3. Invest in customising the client experience
The client appetite for personalisation is n0t just about information – it extends to the whole online experience. When asked what technological investments firms should prioritise to deliver a more personalised service, investors focused on the ability to configure a view of their key wealth information and to view products recommendations for similar investors.
4. Harness clients’ social media profile to enhance your proposition
Wealth management clients may be viewed as highly private individuals. But a surprisingly high 58 per cent of investors say they are willing to share information from their other online accounts such as LinkedIn, Amazon and Facebook with their wealth adviser.
This potentially offers a powerful means to better understand a client’s interests and behaviours and deliver recommendations that go well beyond the usual considerations about age, life goals and attitudes to risk.
5. Consider segmenting clients based on their attitudes to technology
Investors generally are more willing to share data to get greater personalisation. But the appetite for this privacy trade-off – and what clients expect to get in
return – will vary. To capitalise on this, wealth management firms may want to segment clients according to their technology and data-sharing expectations.
Early technology adopters, for example, are open to arming their advisers with more information to secure a better understanding of their risk profile. Digital laggards – those who are slower to
embrace technology – primarily value data sharing if it allows them to access more relevant products and more competitive rates
and fees.
Increasingly sophisticated data capture is going to allow wealth managers to deliver a far more personalised and compelling experience – allowing firms to develop more holistic client understanding and make their proposition, online experience and information delivery far more relevant to each investor.
Striking the right balance between privacy and personalisation will be an ongoing challenge – especially in the wake of GDPR. But provided clients experience clear and ongoing benefits from sharing their personal data – and feel their data is wholly secure – wealth managers will be in a strong position to build even richer long-term relationships.
Jenny Kvaskova is manager at wealth management think-tank Scorpio Partnership
