Client satisfaction is the perennial concern of wealth managers, and a new report suggests they have some work to do.
Capgemini’s 2018 world wealth report found that global satisfaction levels for wealth managers among high-net-worth individuals stood in the low 60% range in the first quarter. Even with a year-over-year increase in satisfaction, this was still below a “passing grade” of 70%.
Here’s the kicker: Over the past two years, investors enjoyed robust investment returns. Capgemini said this suggested that investment returns by themselves are insufficient to sustain a wealth management business.
The report said the wealth of individuals with $1 million or more of investable assets surpassed the $70 trillion threshold, with 1.6 million people joining their ranks globally. High-net-worth wealth grew by 10.6% year on year, a sixth consecutive year of gains, and will surpass $100 trillion by 2025, it said.
Capgemini noted that several concerns may be driving global investors’ subdued satisfaction levels: overall wealth management fee levels, growing need for personalized service and the desire for broader value delivery across investment and non-investment areas.
In order to improve satisfaction, it said, wealth managers must invigorate their personal connection with high-net-worth clients. Doing this will reduce their reliance on investment returns for retaining clientele.
In the first quarter, just 55.5% of high-net-worth individuals globally said they had connected strongly with their wealth managers.