There’s no blueprint for the perfect relationship. It starts with a look, some intrigue… a mutual attraction. Infatuation follows, breathless excitement and then commitment, perhaps marriage and kids. And then it’s happily ever after… or a messy, painful divorce! Been there done that and she even got the T-shirt off my back, long story and it pains me to discuss it so let's get back to the subject at hand.
I haven’t morphed into a cross between the Spice Girls and a marriage therapist - I suspect I spent too long amongst the alpha males of private banking for that – and in fact the words aren’t even mine but those of Scorpio Partnership, consultants to the global wealth management world.
Now I’ve lived through enough visits from “consultants” in the past to know the form. They descend, en-masse, like vultures determined to suck anything useful from your brain before regurgitating it, piecemeal before the CEO – all, of course, for some handsome remuneration. Forgive my bitterness, I know that there are many intelligent – even nice – consultants out there, it’s just important to me in any walk of life to know why someone is qualified to speak on a particular topic and what actual hard data they have to back up their argument.
Scorpio Partnership, has both in droves and any old-timers around here will have heard me wax lyrical in the past about the determination to forensically uncover what the world’s wealthy want from their financial relationships and how the future of private banking might unfold.
This year, they have once again proved that (contrary to the opinions of many) it is possible to ask very wealthy people what they want, need and expect from their banks and wealth managers. The results, part of their ongoing Futurewealth series, are being released in the form of a four-part analysis of the customer experience journey and right now, part three is focused on the secrets of successful long-term relationships between clients and advisors.
So what do wealthy individuals want from their wealth managers?
Well, the answer to that million-dollar question will, depending on who you are, either be strikingly obvious or strangely hidden from view.
Take a moment to look at a chart lifted from Futurewealth 2014: Enhancing the customer service curriculum.
When asked what the most important element of a great wealth management experience is, feeling that an advisor has your unique needs at heart and is truly focused on serving you well is really important. In fact, client-focused service comes top of the pile.
I’ve been talking my throat sore to the grist of extra coarse sandpaper about this for years: Clients don’t care about performance, they think they care about performance, they’ll ask about performance, but what they really want is what every person wants: To be taken care of. The data above proves it.
Therefore it stands to reason that to some of the private banks offering wealth management services the above results might come as a bit of a shock. Not really a big surprise, because if I were to ask you to describe your idea of the traditional private banker the word caring would probably not be the first one to enter your mind.
Many banks still think fees, or investment performance is all that matters. What’s certain is that they are not yet convinced that it is absolutely vital to offer outstanding service to every single client.
How do I know?
Well, take a look at this chart that asks people to reflect on how well their wealth manager knows them:
Once we’ve taken a moment to see how generally satisfied customers in the Americas are, we can pause to consider the fact that in Europe and Asia two in every five clients don’t believe that their financial advisor has a good knowledge of their attitude to risk or financial goals and objectives.
These aren’t customers that pop into a high-street branch every now and again; they are high-net-worth individuals who pay handsomely for the chance to benefit from a wealth manager’s expertise.
How on earth can that benefit be maximized when the advisor doesn’t understand what makes that customer tick?
For me, now on the sidelines of the private banking game, there is an urgent need for wealth managers to listen to the client, to ask – via actual customer research – what those clients want and to deliver on those needs and wants in a way that provides a genuinely meaningful relationship.
The reward for clients will be better service and better performance in relation to their financial goals. The carrot dangling for the banks is loyalty, a greater share of a client’s assets and their advocacy and willingness to refer.
If you prefer the stick to the carrot, the risk of continuing to sideline the customer voice is that clients will simply shift their assets to someone who does listen. One thing that endures irrespective of wealth or geography is this: Unhappy clients can vote with their feet!