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Next-Level Wealth Management: Harnessing AI to Enhance Client Experiences

Globally, only 18% of affluent investors are satisfied with their wealth management services due to limited digital tools and inefficiencies in the wealth value chain. To drive revenue growth and enhance client satisfaction, firms must empower relationship managers with AI-based, integrated interfaces and exceptional experiences while addressing digital immaturity.

A mere 18% of investors in the affluent segment express satisfaction with their current wealth management services, according to the recently published World Wealth Report by Capgemini. The study highlights the limitations faced by relationship managers due to the lack of digital tools, which hinder their ability to provide timely financial advice and value-added expertise. This deficiency also has a negative impact on their overall performance. The report reveals that only one in three executives believe their firm's digital maturity is high across all stages. Additionally, 45% of executives report rising costs per relationship manager, mainly due to inefficiencies in the wealth value chain.

Lagging digital readiness and inadequate omni-channel platforms contribute to relationship managers spending a significant portion of their time on non-core activities. This leaves them with only a third of their time available for pre-sales efforts and client interaction. The strain is felt on all fronts, with 56% of High Net Worth Individual (HNWI) respondents stating that value-added services influence their choice of a wealth management firm, yet only half express satisfaction with their relationship manager's ability to deliver on these services. Nearly 31% of respondents are likely to switch wealth management providers within the next year.

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Source: Capgemini Research Institute for Financial Services Analysis, 2023
Question asked to relationship managers: In last 12 months, Estimate the percentage of time you actually spend and the time you desire to allocate to the following activities?

The report emphasizes the need for wealth management firms to equip relationship managers with an integrated one-stop-shop interface and create an exceptional client experience in order to drive revenue growth and enhance client satisfaction. A digital workstation, for instance, can enhance productivity and customer engagement by enabling relationship managers to mobilize and coordinate the right experts at the right time to serve clients.

Nilesh Vaidya, Global Head of Banking and Capital Markets at Capgemini, stated, "Wealth management firms are facing a critical turning point as the macroenvironment necessitates a shift in mindset and business models to achieve sustainable revenue growth. Agility and adaptability will be crucial for high-net-worth individuals as their focus shifts towards wealth preservation. The industry must strengthen its value proposition, empower relationship managers, and unlock new growth opportunities to remain relevant. Addressing digital immaturity in the wealth value chain will be vital to their success."

The report also emphasizes the importance of expanding the pool of potential wealth management clients in order to achieve long-term industry growth. The affluent segment, which continues to grow in size and financial influence, presents a new frontier. North America (46%) and the Asia-Pacific region (32%) currently hold the largest shares of global affluents in terms of wealth value and population. Surprisingly, 34% of firms are not exploring this segment, despite it holding almost USD 27 trillion in assets (approximately 32% of total HNWI wealth).

An overwhelming majority (71%) of affluents express interest in seeking wealth advisory services from their banks within the next year. To cater to this segment's needs while keeping operational costs low, AI-enabled customization and personalization is deemed the way forward. Investment advice is often considered irrelevant or mass-produced without adequate personalization. According to a recent survey "Swiss Affluent Clients" by Deloitte Switzerland on Swiss affluents, 
defined as clients with bankable assets between CHF 200,000 and CHF2 millions, constituting around a quarter of Switzerland’s population, 64% are missing financial planning around life events and 41% of respondents would welcome personalized investment ideas. 

Which banking products or services are you currently missing or feel are not good enough?

Deloitte study Jnu2023

Source: Deloitte Switzerland, Swiss Affluent Clients, Building a winning proposition for a growing client segment, June 2023

According to Deloitte, despite the impressive size, attractive growth and favorable characteristics of the market segment, dedicated and personalized service models for affluent clients continue to be relatively rare in Swiss banks. Retail banks often categorize affluent clients as "large retail clients," while private banks tend to selectively accept affluent clients who have the potential to become high-net-worth individuals (HNWIs) in the near future.


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