Wealth management trends for 2022 to keep an eye on
A holistic experience (including expert guidance and 24/7 support) will be a baseline requirement for consumers in the coming years. That means firms and wealth managers will need to demonstrate wholehearted commitment, conducting meaningful conversations with clients while providing authentic financial planning.
This approach could prove challenging for time-poor professionals. Therefore, wealth managers will need to work smarter, particularly as consumers want support wherever they happen to be (expertise on tap, round-the-clock), demanding an engaging digital experience, with a fluid platform that creates substantial engagements.
Technology innovations that are altering clients’ lifestyles
The always-on mentality and proliferation of mobile devices and wearables have changed the way clients want to access information. Human-centered design places users at the heart of things by investigating ecosystems, embracing inclusive design and digital upskilling, and keeping things personal.
Apply user experience (UX) fundamentals and functionality
U.S. banking and capital markets (BCM) companies are not doing enough to keep up with their clients’/customers’ changing money management needs. Expectations have been raised, so managers need to meet clients where they are, assuring users that their firms provide the optimal security and privacy services.
It’s important to be proactive and focus on personalized interactions, embedding financial and behavioral insights, plus instilling confidence through clarity of content. It almost goes without saying that you must also provide super apps for evolving consumers — the right tools, for the right clients, internal employees and customers, at the right time.
ESG: Ethics and social considerations
Aligning demographic fundamentals and functionality is crucial
Thematic and impact investments will gain traction and become omnipresent.
The millennial-wealth-investment segment — with its heightened focus on equity, racial justice and the environment — is growing and beginning to influence investment decisions. Not surprisingly, valuation of this rapidly evolving environmental, social and governance (ESG) investment criteria has claimed center stage.
This trend is about ensuring an organization's commitment to long-term sustainable growth involves better data and disclosures, to help investors understand the deep interdependence between environmental and social issues.
The increased public, federal and corporate focus around ESG equity presents an amazing opportunity for corporate leaders who accept the challenge.
Changes in asset investment
Recent and emerging techniques will affect investment decisions. Things like:
On one hand, support for real-time payments on a global scale has meant updating technology or designing new systems. On the other, faster settlement processes have proved a real boon for business. Blockchain’s decentralized ledgers are speeding up reconciliation and transactional settlement processes. And while migration of legacy systems is important, it can create its own challenges.
Platform technology evolution
Several factors will affect end users on B2B, B2C and B2B2C engagements:
The industry will see increased consolidation
Platforms enable and accelerate this tendency
Compliance and regulatory adhesion
Will increase the deployment of AI and machine-based learning
Digital adhesion becomes business-as-usual (digital first)
Natural language processing will show major advances in wealth management predictive analytics and data opportunities
Partnering with scale players to democratize wealth management
Products and services
The range becomes complete and the platform creates a "no boundaries” marketplace
Technology trends will drive the following:
Direct indexing strategies with clients
Investment in client experience
Increased data aggregation and analytics
Demand for workplace savings technology
Consolidation of retirement technology providers
Customization of workplace retirement plans
Alternatives go mainstream
Expansion of remote, location-independent advice
Adoption of cloud-based services
Measuring 2022 and beyond
KPIs and the bigger picture
Digital transformation is being validated according to wealth management KPIs. It shows that digital innovation boosts productivity and AUM, which translates into higher market share, revenues and shareholder value.
Senior Director, Strategy and Innovation Design, Luxoft
Shelagh is an award winning, strategic innovation leader and oversees the strategic arm of the Smashing Ideas human-centered design offering. As a thought leader and innovation driver, Shelagh has over 15 years’ program innovation experience, focusing on behavioral psychology and customer-centric experiences. With an expanding portfolio across health, auto, insurance, finance, retail and other markets, her vision and insights create impactful results for our business and portfolios.
Ian Max Ewart
Director, Wealth Management Strategy, Luxoft
Ian is an acknowledged industry leader and reference for wealth management. He is actively involved with a number of innovation firms and partners in FinTech and RegTech.