Delivering ‘smart’ digital transformation in APAC’s dynamic wealth markets

This is a sponsored article. 

By James Verner, President, InvestCloud APAC,

James Verner offers his perspectives on how technology solutions, if conceived with the right strategies and delivered efficiently and effectively, can facilitate and fast-track the ability of private banks and other wealth firms to seize the many opportunities on offer in the dynamic Asia Pacific markets.

InvestCloud is a powerhouse global Software-as-a-Service (SaaS) wealth solutions platform that is one of the fastest-growing B2B WealthTech businesses globally. The firm has the vision to facilitate the digitisation of offerings as financial institutions adjust their business models to rapidly evolving markets, where clients expect a more relevant, personal and real-time proposition – and all for lower fees.

With a strong APAC presence, including offices in Singapore, Hong Kong, Japan and Australia, InvestCloud has been rapidly building partnerships with leading private banks, wealth managers and other players in the investment space to digitise their wealth management operations and enhance client experiences. InvestCloud’s modular approach allows clients to upgrade their capabilities, make the most of existing technology investments and promote client growth, client retention and operational efficiencies in a cost-effective and agile manner, rather than a “rip and replace” approach laden with risk.

Retain, win, enhance

InvestCloud offers a single digital cloud native application to help clients retain their private clients and win new ones, while driving huge gains in operational efficiency.

This is the case for over 400 wealth managers around the world – including private banks, consumer banks and insurance company adviser networks – including over 150 asset managers globally. With just over USD6.3 trillion of assets on the InvestCloud platform, supporting over 7,000 user experiences in over 40 countries for over 20 million global investor accounts today, InvestCloud has a significant presence in APAC, serving many of the large and leading players in each of those markets, both locally and regionally.

Great opportunities ahead

The regional market remains dynamic, with expectations of a doubling of wealth management AUM in APAC by 2025. “The opportunity is most certainly there, and one of the key challenges for wealth managers is building the scale to really access these opportunities across this huge and diverse region,” James says. “Other major challenges are to deliver a genuinely excellent client experience, and to build relationships across generations.”

Another challenge is for banks and other wealth management firms to become the trusted adviser to the clients. “On this point,” he adds, “I can refer to the latest issue of the annual Capgemini World Wealth Report that came out last month, which indicates that 73% of people, when they cross the million-dollar threshold of investable assets, switch their lead wealth manager. This means that to hold onto these clients, you need to provide something better, something different.” 

A quest for seamless client journeys

James adds that the quest for differentiation, a key objective, must be to make the client journey more seamless, less ‘clunky’ and more ‘frictionless’, as he termed it.

As a general theme, a lot of the technologies and the client experiences today are still quite siloed, so there is a resultant friction in the system, where things that you think should be obvious and easy to do, are not actually easy. This means a fairly quick win can result from focusing on data, connecting all these data dots in your organisations and thereby making client journeys more intuitive, frictionless and also more personalised.

The wealth industry is still far from delivering hyper-personalisation. “We know from surveys that the way clients ‘feel’ about their experience influences some 70% of their buying decision, meaning that it is their emotional response to the client experience that drives their loyalty and activity.”

The transition to fee-based wealth management

James expands on these concepts – within APAC, Australia and Japan are the most advanced in these areas, with a transition taking place from product-driven wealth management to more of an advisory and fee-based proposition. The advisory-based offering is driven not by age or wealth but more by the need for planning – and the type of planning needed – helping clients understand and communicate their goals and hopes, and then helping deliver planning around achieving those life goals.

A lot of this can be significantly accelerated and improved upon by the clever use of data, which drives personalisation and relevance, and helps tailor conversations, advice, and products – specifically around the framework and conversations around longer-term horizons.

Digital empathy

A core element is digital ‘empathy’, which is an understanding between the adviser and the end-client, so they see themselves on the journey together and the RMs and advisers are cognisant of the customer’s hopes, dreams and fears. “In this way, it really becomes personalised planning, and to achieve that at scale you need the right technologies,” James says.

If wealth managers manage to retain their clients and win a greater share of wallet as trusted advisers, the next step should be to leverage those successes through stimulating a network effect to bring in new clients as well. “You then achieve growth through retention and growth through new clients coming into the network,” he explains.

Step-by-step transformation

The observation that technology that can help achieve these goals should be layered in efficiently, in a modular manner, as digital transformation can be expensive and time consuming. “You need to ensure that your cost to serve is in tune with the market potential and your broader objectives. Consequently, our own early discussions with our clients focus on helping position them for this growth and retention agenda, and also on helping them reduce costs and enhance other operational efficiencies. If you can get those areas right, then you are well positioned to take advantage of the great growth potential that this dynamic region offers.”

InvestCloud supports trillions in assets across hundreds of diverse clients – from the largest banks in the world to wealth managers, asset managers and asset services companies.

This article is general information and does not consider the circumstances of any investor or constitute advice. No fund or stock mentioned in this article constitutes an offer or inducement to enter into any investment activity.