Adding the personal touch to wealth management

Over the past two and a half years, my business model has been turned on its head. Like the rest of the world, I went from connecting with colleagues and clients, existing or prospective, at conferences, meetings and happy hours, to scheduling video calls and finding ways to build relationships in a completely virtual manner.

As the founder of a marketing firm for wealth-management groups, I’ve recently started travelling again, and the excitement felt from being back in person is palpable. But I’m not ready to give up everything I’ve learnt since the start of 2020.

Even before the Covid outbreak, I touted the need for more personalisation in wealth management. Telling your clients that you have a “holistic” approach to investment, and that you have “robust solutions” to meet their needs does not make you stand out from the crowd. It only makes you blend in.

Capgemini, the management consultancy, has long found that investors want more personalisation from advisers, be it through their communication or investment options. In its latest World Wealth Report, Capgemini reported that 51 per cent of high-net-worth individuals were unsatisfied with the personalised offerings of their current wealth-management firm.

This focus on personalisation takes on new meaning when we start accounting for once-in-a-lifetime calamities — as happened repeatedly during the pandemic.

And in developing personalisation, wealth managers should learn from luxury brands. High-net-worth investors are familiar with these companies, and comfortable with their approaches to marketing as a “client experience”. They sell to individuals based on past interactions and purchases, with accessible store and online experiences.

Take the jewellery store Tiffany. A person can walk into any Tiffany store and expect a certain quality of service, as well as a unified look. Every purchase is packaged in a blue box unique to Tiffany. Each buyer is made to feel they are getting special treatment, whether they are buying a simple ring or an extravagant necklace. A salesperson will enquire about the individual’s needs, and follow up with a handwritten thank-you note, reflecting details heard in their sales conversations. Who wouldn’t want that service?

That kind of openness in communication can be more readily developed by wealth managers in the post-Covid world than previously. A survey by the Certified Financial Planners board, a US industry grouping, revealed that, at the start of the pandemic, there was a surge in investors reaching out to their advisers, seeking guidance on how to weather the storm. With a recession facing us, this kind of regular conversations will continue in the coming year.

In the past, conversations with investors were limited to phone calls and annual office meetings. Now, clients and advisers are easily accessible over video calls, meaning that short, regular contacts can happen more frequently than in the past, making interactions more of a dialogue.

This accessibility has also opened up a new world of possibilities. It is now commonplace to see into each other’s homes, catching glimpses of family members and pets as well as living spaces. Financial advisers can better understand their client as a person when they see their home life. High-school graduation photos of children might perhaps trigger a conversation about inheritance, or college payments. A bevy of rescue animals can bring up thoughts about philanthropy. A series of rare-looking paintings may need a new valuation and insurance. A spouse or partner walking around in the background could allow for a personal introduction to someone who may normally take a back seat in family investing.

Academics at Australia’s Griffith University found that financial advisers played an important role during the pandemic by providing secondary services, reaching beyond the usual investment-strategy conversations. For example, they would liaise with insurance companies when their clients were dealing with serious health problems or deaths in the family. These moments of trust-building are essential for long-term relationships. 

Investors want to relate to their advisers, so it is equally important that they see into their adviser’s home, or have chats about personal items that appear. David Durlacher, the chief executive of Julius Baer’s UK arm, told the Financial Times in 2020 how a video call with a wealthy client about investment strategies turned into his contribution to a family debate about how to make an omelette.

The benefits of a more accessible approach are clear.  As other family members can be more readily available on casual calls or via video, advisers will be able to build relationships with more family members, not just the patriarch or matriarch. That could mean longer-term ties for advisers, as these other family members will feel connected to them and willing to continue a relationship later, as opposed to looking for their own adviser.

Changes during Covid happened organically, as we were forced to adapt and develop. As it becomes easier to go back to business as usual, the challenge lies in taking on the lessons learnt. 

April Rudin is the founder of The Rudin Group, a New York-based global marketing firm for wealth management and wealthtech firms

This article is part of FT Wealth, a section providing in-depth coverage of philanthropy, entrepreneurs, family offices, as well as alternative and impact investment