2022-06-09-奥纬咨询-Time_To_Evolve_34页_5mb

Wealth Management 3.0: The Next Evolution

Executive Summary

• Industry Transformation: Tech is democratizing wealth management, enabling scalable and modular service models like “Wealth Management 3.0” for broader client engagement.
• Key Challenges: Wealth managers face revenue growth pressure due to inflation, geopolitical risks, and shifting client demands, necessitating transformation.
• Opportunities: Growth lies in lower wealth bands, new product categories (ESG, private markets, digital assets), and enhanced digital experiences.
• Tech's Role: Technology enables lower costs, personalized advice, and seamless omnichannel service models, driving profitability.

Key Pillars of Wealth Management 3.0

1. Evolving Client Coverage & Service Models

• Modular Service Models: Three archetypes—Digital-Led, Hybrid, Human-Led—tailored to client digital affinity and economic potential.
  • Digital-Led: Default for tech-savvy clients; reduces costs to as low as $0.5K per client.
  • Hybrid: Combines digital tools with human advisors, enabling 50-100% productivity increases.
  • Human-Led: Focuses on bespoke, high-touch service for ultra-high net worth clients.
• Broader Client Access: Reaching affluent and low-HNW segments (e.g., $300K–$5MM wealth) to tap into $230BN revenue pools.
• Digital Base Layer: Core banking integration via APIs, enabling omnichannel experiences and data-driven insights.

2. Delivery Model Transformation

• Cost Reduction: Investment-grade wealth managers target 6-8% revenue allocation to digital transformation.
• Process Streamlining: 50% of advisors’ time on non-revenue tasks; automation of KYC/AML, onboarding, and trade execution.
• Cloud & API Adoption: Reduces IT fragmentation (average 6+ legacy systems) and enables vendor partnerships for niche capabilities.
• Nearshoring/Outsourcing: Offshoring routine tasks (e.g., fund administration) to optimize costs, especially for private markets.

3. Dynamic Value Management

• Client-Level Profitability: Real-time dashboards enable granular tracking of revenue/costs/profitability, identifying unprofitable client segments.
• Strategic Levers: Discounts (30–50% off rack rates) and cross-subsidization mask inefficiencies; solution: Pricing-aligned service models.
• Data-Driven Economics: Predictive analytics optimize client segmentation, product recommendations, and dynamic pricing.

4. Implications for Asset Managers

• Intermediated 3.0: Deepen technical integration (APIs, data-sharing) for customized, white-label solutions via wealth managers.
• Direct/Integrated Models: Build end-to-end digital platforms for captive wealth clients, competing head-on with integrated offerings.
• Content & Customization: Asset managers must deliver tailored insights (ESG, thematic strategies) and leverage data for predictive client experiences.

Financial & Macroeconomic Context

• Industry Revenue Growth: Slowing (4–5% CAGR vs. 8% prior), with higher wealth bands still dominant, but affluent segments emerging as key revenue drivers.
• Regulatory Shift: Increased preference for onshore wealth management, especially in APAC (e.g., Singapore over Hong Kong).
• Private Markets Boom: Expected to generate ~$110BN in revenues by 2026, driven by sustainable investing and tech-enabled accessibility.

Takeaways for Wealth Managers

• Prioritize Tech Investments: Cloud migration, APIs, and data platforms reduce costs (2–4% CIR improvement).
• Embrace Partner Ecosystems: Collaborate with FinTechs for niche capabilities (e.g., ESG ratings, secondary markets).
• Modularize Offerings: Combine discretionary mandates with expert advice to serve diverse client needs at scale.
• Data-Driven Profitability: Transition from aggregate to client-level economics to eliminate unprofitable relationships.