UK Wealth Management Research Portfolio Trend Trust 2012

Transcription

1 UK Wealth Management Research Portfolio Trend Trust 2012 Essential Tracking of High Net Worth Individuals Ledbury Research s Trend reports scrutinise specific developments and issues within the HNWI population, assess their nature and impact and provide actionable advice for wealth managers looking to exploit the associated opportunities. This trend report examines overall levels of trust between wealth management providers and their HNWI clients. It looks at the service elements that are critical in building HNWI trust, examines the differences in trust levels within the various HNWI segments, and explains how to go about building and maintaining these levels.

2 Summary The Trust report focusses on HNWIs with at least 500,000 in investable assets that make use of a private banker, wealth manager, full service investment manager or stock broker. It specifically looks at the differences in trust levels within HNWI segments and across competitor types as well as differences by age, gender and wealth Overall Levels and Drivers of HNWI Trust Increasingly over the last few years, the industry has been active in trying to regain HNWI trust as this is vital in establishing a higher share of wallet and greater take-up of high-end services. Current data shows that there is a positive relationship between trust levels and share of wallet. It therefore follows that if wealth managers are able to increase client trust then they are likely to gain a higher share of their wealth. In order to gain this higher share of wallet we looked at what service elements were closely correlated with trust levels among HNWIs and found that there isn t a single element for providers to focus on when it comes to trust. Instead, trust can be analysed into four themes, each with its own impact and implications. Trust Levels within Consumer Segments and across Competitor Types Changes within specific segments of the HNWI population and different types of competitors operating within the wealth management market have meant that there are many new opportunities to build trust. Among these opportunities are HNWIs with lower levels of trust who are most attractive to wealth managers both within the confines of their own provider and from the client bases of other providers whose trust is on the wane. Implications and Ideas for Wealth Managers In order for wealth managers and providers to prioritise the most appropriate service elements to focus on, they must look at ideas that build trust. The most important involves communication and needs to happen at the main contact, provider and industry level. It must also be realised that trust is a two-way process and, whilst expecting their clients to trust them, wealth managers must also understand that they need to trust their clients in return, perhaps looking at pricing structures to reflect this.

3 Methodology Reasons to buy Prospective customers This research draws on the findings of Ledbury Research s annual Wealth Management Benchmark study, which surveys a representative sample of 500 HNWI clients in the UK. The study was carried out in Q4 2011, and is the sixth in this annual series. All of the individuals surveyed have at least 500,000 in investable assets and all make use of a private banker, wealth manager or full service investment manager or stock broker. This representative sample provides us with an accurate picture of the HNWI population that is currently serviced by the wealth management industry in the UK, with robust samples of the following sub-segments: 0.5 to 0.9m, 1m to 1.9m, 2m to 2.9m and 3m and above. Mentions of HNWIs or the wealthy in this report therefore refer specifically to the managed wealthy, while wealth managers collectively refer to private banks, wealth managers, or full service investment managers or stock brokers. See the varying levels of trust across the HNWI population by segment and understand the reasons behind the differences. Understand the four components that make up HNWI trust in wealth management providers. Learn how best to go about gaining the trust of HNWIs and why, in order to communicate this effectively, trust must be a two way process. Discover which service elements are most important to utilise when communicating with your clients, with the aim of increasing trust from the specialists in researching HNWIs, Ledbury Research. This series has been designed for a wide range of internal stakeholders within wealth management firms: Chief Executives and other senior decisionmakers who need dependable intelligence into the HNWI population that contains real insights, expert commentary and impactful ideas. Sales and Marketing Executives who want an A to Z reference guide to HNWI clients, with segmental breakdowns. Senior product and service managers trying to understand and cater for the needs of key client segments.

4 Sample Pages Ledbury Research Trust Trend Report Ledbury Research Trust Trend Report

5 Contents Executive Summary Methodology Section 1 Overall Levels and Drivers of HNWI Trust Over the last three years, wealth managers haven't built trust in the overall HNWI population Client trust is an absolute necessity for the wealth management industry Fairness, helpfulness and professionalism are very important in building trust in main providers and contacts The four themes that run through the service elements are reliability, truthfulness, allegiance, and ability Section 2 Trust Levels within Consumer Segments and across Competitor Types Trust Levels within Consumer Segments 1. This year has seen a marked reversal in traditional trust patterns by gender 2. Trust levels vary according to source of wealth 3. Trust is moving consistently upwards within the highest wealth band 4. Older HNWIs generally trust the industry more than younger age groups Consumer Segments with the lowers trust levels offer the most opportunity for wealth managers Trust levels across Competitor Types Section 3 Implications and Ideas for Wealth Managers