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Kritika Jain Author's Perspective
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3 Minute read

Digital Transformation in Wealth Management: What Leaders Need to Focus On

Digital B2b

The financial sector is facing profound transformation, especially in terms of technology adoption. As customers continue to demand personalized experiences, Wealth Management digitalization is gaining momentum like never before. The change in industry perception, customer demographics and economic realities, are adding up to the speed at which FSI firms adopt digital ways of offering their services.

FSI leaders are in constant flux to prioritize between customer-centricity and achieving overall organizational goals. Today’s customers are digitally inclined, research-oriented and look for autonomy in their decisions. Thanks to the technology in their hand that they research almost everything. They are very different from baby boomers, who were the favorite of wealth managers. The Generation X and Y investors have zero to very little patience and expect personal attention across all digital touchpoints.

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At large, AUM companies are still struggling to cope up with the wave of rapid digitalization and dynamic customer expectations. The age gap between wealth advisors and Gen X and Gen Y investors is prominent when it comes to being comfortable with technology, evolving models and an approach that blends science and human touch seamlessly.

global wealth management market

Global Wealth Management Market 2021-25

It’s a challenging time for the FinServ industry, especially for the wealth managers who are expected to offer omnichannel experience to their customers. Around 84% of global asset managers have lost investors to digital-first disruptive competitors. Their roles are threatened by the FinTechs and Digital Native Brands who leverage technology and their customer-first expertise to fulfil customer expectations seamlessly.

What is Digital Transformation in Wealth Management?

Digital transformation in Wealth Management is a response to evolving customer expectations, and harnessing the power of the right tools and technology to curate tailored experiences for each customer in every interaction. Digitalization in wealth management is pushing up self-service, empowering client decision-making and reducing cost-to-serve for FSI firms.

Below are the top customer expectations that Wealth Management companies need to fulfill to successfully realize the essence of digital transformation:

wealth management companies

What are the Benefits of Digital Transformation in Wealth Management?

You would be surprised to know that as per surveys, there is no FSI firm that doesn’t know about the perks of digital transformation for their organization. Around 39% of FSI organizations are in the process of implementing multiple digital solutions and 21% of firms are evaluating technologies for specific financial functions. (EY)

Digital innovation has enabled transparency and efficiency for wealth management firms. Here are the top benefits of digital transformation in Wealth Management:

  • Increased customer acquisition and retention
  • Real-time information on customer behavior
  • Single platform for 360-degree view of customers
  • Contextual experience for customers across channels
  • Seamless omnichannel experiences
  • Faster time-to-market

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What are the Priorities of Digital Transformation Leaders?

Looking at the accelerated digital transformation, FSI leaders are trying to equip themselves to stay relevant to future investors. They are building human and MarTech capabilities to eliminate the roadblocks such as unpredictable market, data security concerns, budget constraints and lack of technical infrastructure. Here are the top priorities for digital transformation leaders in Wealth Management firms:

top priorities of digital leaders

Source: Oracle (Wealth and Asset Management 2022)

What are the Digital Enablers in 2022 and beyond?

The whole idea of digital transformation is simplifying and innovating financial decisions for customers. Here are the top digital enablers that can re-shape the face of Wealth Management firms and future-proof their business:

  1. Cloud Computing
    With the enormous amount of data that FSI firms handle, data security has been the top concern for most FSI companies. Cloud computing leads to improved collaboration, along with low maintenance cost and excellent accessibility across the organization.
  2. Data Analytics
    Big data is revolutionizing the technical aspects of FSI firms. With greater emphasis on personalization, and increasing competition between FinTech companies, banks and insurance companies need to leverage the true potential of data to excel customer understanding.
  3. Enterprise Resource Planning Software
    Having ERP software leads to holistic growth of the organization. FSI firms can improve collaboration and workflows while standardizing business processes. An ERP facilitates regulatory compliance and better data reliability, while ensuring data security and quality.
  4. Internet of Things (IoT)
    IoT is the backbone of personalized customer experiences. With a strategic approach to IoT, FSI firms can customize the user experience on the basis of real-time data. This will lead to better communication and add human value to digital experiences.
  5. Artificial Intelligence/Machine Learning
    Customer sentiment analysis, better customer service and enhanced data security are some of the top benefits of Artificial Intelligence and Machine Learning for FSI firms. It enables better compliance and reduced operational costs due to process automation.
  6. Robotic Process Automation
    As the name suggests, Robotic Process Automation is a gateway to better customer service and improved employee efficiency. RPA helps FSI firms save operational costs, along with enhanced compliance with rules and standards. It leads to more data accuracy and reliability.
  7. Blockchain
    Traceability and transparency of data are the major concerns for FSI firms across the globe. Blockchain addresses the scalability, regulatory and privacy concerns of investors and FSI firms alike. It enables bilateral settlement by eliminating midpoint failures.
  8. Virtual and Augmented Reality (VR/AR)
    The illustrative world of VR and AR is a new dimension of customer experience which transports customers to the near-real setup through virtual setup. It increases the chances of cross-selling and upselling, along with safer investment plans.
  9. 5G
    5G technology has the ability to collect vast and real-time information for increasing backend efficiency. 5G enhancements create more reliable, responsive networks, it can help banks and other financial institutions ensure that this future is more productive, efficient and protected.

Final Thoughts

Digital transformation is not an overnight phenomenon, it takes years for brands to understand the constantly evolving market. With continuous efforts, the right blend of talent and technology, leaders can effectively bridge the gap between customers’ expectations and organizations’ goals. Digital transformation for AWM companies boils down to identifying possibilities for attracting, growing, and maintaining the customer base with the help of innovative omni-channel strategies. Further, AWM companies must define triggers to foster proactive and interactive, rather than responsive communication.

About us, we are a global digital business transformation firm, focused on helping clients deliver an exceptional customer experience (CX) through 1:1 personalization & enhanced engagement. We enable this by creating an integrated IT infrastructure across an array of digital platforms in MarTech, CMS, commerce, analytics, and other digital solutions, to build a single view of the customer across channels.

Get in touch with our team for a no-obligation consultation. All you would be required to do is drop us a ‘Hi’ at marketing@altudo.co and we will align the right team to achieve your dream of digital transformation.

Kritika Jain


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