of the Y (and Z) Generation in · 2019-12-16 · Generation Y - Millennials Mobile first attitude:...
Transcript of of the Y (and Z) Generation in · 2019-12-16 · Generation Y - Millennials Mobile first attitude:...
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Unlocking the Potentialof the Y (and Z) Generation in
Wealth Management
Imre Rokob
Unlocking the Potentialof the Y (and Z) Generation in
Wealth Management
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We at Dorsum
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Our customers by sectors:• Banks
• Asset Managers
• Brokerage Firms
• Insurance Companies
• Factoring Companies
• Pension Funds
Clients and Partners
Our customers by sectors:• Banks
• Asset Managers
• Brokerage Firms
• Insurance Companies
• Factoring Companies
• Pension Funds
Partners:
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Today’s session:
Are robo advisors a real threat for new generation customers or a trendy gizmo?
Why hybrid advisory can be the answer?
Ways to become digital hybrid advisor and to service future client base?
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Are robo advisors a real threat for newgeneration customers or a trendy gizmo?Are robo advisors a real threat for newgeneration customers or a trendy gizmo?
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Battle of Generations
Generation Y - Millennials•born in 1977-2000•Dedicated device: PC, tablet,smartphone
•Financial decision: Face-to-face,but information can come fromdigital source.
Baby Boomers•Born: 1945-1960•Dedicated device: TV•Financial decision: Face-to-face ideally, but telephone andemail if required. Increasinglywill go online if they can savetime.
HERITAGE
Generation X•Born: 1961-1977•Dedicated device: PC•Financial decision:Online – would preferface-to-face if timepermitting
Generation Z•born after 2000•Dedicated device: tablet,smartphone, wearabletechnologies (augmentedreality, gamification)
•Financial decision:Solutions will be digitallycrowd-sourced
HERITAGE
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Generation Y - Millennials
MILLENNIALS ARE
2.5XMORE LIKELY TO BE AN
EARLY ADOPTER OFTECHNOLOGY
THAN OTHER GENERATIONS
http://www.millennialmarketing.com/
MILLENNIALS ARE
2.5XMORE LIKELY TO BE AN
EARLY ADOPTER OFTECHNOLOGY
THAN OTHER GENERATIONS
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Generation Y - MillennialsMobile first attitude: 22.9 MILLION – NUMBER OF
BANKING APPSDOWNLOADED SO FAR,
A RISE OF
8.2 MILLION IN ONE YEAR
Consumer behaviour and expectations have beenirreversibly shaped by digitally nativecompanies – the smartest banks areaddressing this expectations gap, but the paceneeds to accelerate.
22.9 MILLION – NUMBER OF
BANKING APPSDOWNLOADED SO FAR,
A RISE OF
8.2 MILLION IN ONE YEAR
https://www.bba.org.uk/publication/bba-reports/ world-of-change-2/
EY Financial Services - Europe | The Way We Bank Now: World of change
“Millennials and money The unfiltered journey” by Facebook IQ, Jan 2016.
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Why are they soworthy?
Generation Y - Millennials
As a collective group, the Mass Affluent control more than $7.5 trillion in investable assets.BAI, Engaging and Retaining Mass Affluent Customers, 2014
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Why are theyrelevant?
Generation Y - Millennials
Top priorities… They are Planners
Merrill Edge Report
Top priorities… They are Planners
85%track and managetheir money/budgeting
77%balance short andlong term goals
84%save for retirement
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Generation Y - Millennials
Why are they(digitally) important?”
Affluent Millennials are reshapingthe future of the finance industry andforcing drastic changes to financialservices providers’ business modelsand marketing strategies.
* Schwab, Fidelity, Vanguard, TD Ameritrade Source: Cerulli, BlackRock Global Corporate Strategy 2015. Thismaterial is not intended to be relied on as a forecast. There is no guarantee that estimated numbers will come to pass.
Capgemini – Evolution of automated advisors 2016
”Affluent Millennials are reshapingthe future of the finance industry andforcing drastic changes to financialservices providers’ business modelsand marketing strategies.
2015 United States Affluent Millennial Research Study
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Robo advisorsRobo advisors
ON AVERAGE,59% OF
MILLENNIALS GLOBALLYEXPRESSED COMFORT WITHROBO-ADVICE, WITH 63% TRUSTING IT;
WITHIN EUROPE,70%WERE COMFORTABLE WITHROBO-ADVICE, WITH 65% TRUSTING IT.*
ON AVERAGE,59% OF
MILLENNIALS GLOBALLYEXPRESSED COMFORT WITHROBO-ADVICE, WITH 63% TRUSTING IT;
WITHIN EUROPE,70%WERE COMFORTABLE WITHROBO-ADVICE, WITH 65% TRUSTING IT.*
*Legg MasonKPMG Report: Robo Advice Platforms Will ManageUS$2.2 trillion Worth of Assets by 2020
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Robo advisors
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Why hybrid advisory can be the answer?Why hybrid advisory can be the answer?
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Don’t be a dinosaur, be a Hybrid.Given the high level of client demand and growing competition from non-traditional players wealth managementfirms must make it a high-level priority to develop a strategy for investing in automated advice.Evolution of automated advisors 2016
KPMG advises banks: “The opportunity for banks is ripe, but you must act now to capture your share of themarket. Otherwise your clients will eventually look for these solutions at other institutions.”
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Ways to become digital hybrid advisor andto service future client base?Ways to become digital hybrid advisor andto service future client base?
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Innovationinthe
Innovationinthe
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Recipe for success - Ingredients
Innovationinthe
Dedicated projectteam
End user testingFocus on innovation
Use the latesttechnology
Innovationinthe
Be agile
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Battle ofgenerations
Battle ofgenerations
11
44Full robo is
not theanswer
Full robo isnot theanswer
@ Dorsum making innovative products is a must
33 5522 Wealth Management:
• Automation where it is applicable• Real time availability of the advisor• Proactive approach from the advisory side• Goal based advisory
Battle ofgenerations
Hybrid casestudies
Hybrid casestudies
Mobile firstattitude
Mobile firstattitude
44Full robo is
not theanswer
Full robo isnot theanswer
Innovationrequired
22 Wealth Management:• Automation where it is applicable• Real time availability of the advisor• Proactive approach from the advisory side• Goal based advisory
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Digitalization in Wealth Management
Usage gap (%)
••
•Social Media•
•Mobile/appPodcasts/videos
Automated (Robo)advisory
•Chat
FOR MILLENNIALSDIGITAL SOPHISTICATION IS THE
3rdMOST POPULAR FACTOR
IN CHOOSING A WEALTH MANAGER
Digitalization in Wealth Management
Interest(%)
Call for development Strong call for development
No need for focus Continuation
•Social Media•Online Banking
61% OF MILLENNIALSSAY THAT DIGITAL INNOVATION IS AREASON IN SWITCHING A WEALTH MANAGER
FOR MILLENNIALSDIGITAL SOPHISTICATION IS THE
3rdMOST POPULAR FACTOR
IN CHOOSING A WEALTH MANAGER
BCG Global Wealth Client Survey, 2016
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Traditional players vs. Robo advisors
Robo-Advisors:
Pros:• More cost efficient than traditional players• Lower initial investment required• Your rich level does not count, all clients are equal• Excluding the emotional factor
Cons:• The scope is limited, so no comprehensive financial
planning• Non individual goal and risk-tolerance profiling• Overmuch automatic• Limited set of funds you can invest in• Impersonal: no chance to ask from a human
Traditional Financial Advisory Firms
Pros:• Personal contact during a phone call or a meeting• Flexible, because you can make real-time
decisions and not blocked by algorithm• Wide-range of knowledge and expertise you can
count on
Cons:• High level of entry “fee”• Sometimes one for all products because of the
company push• Slow technology adopters• Old fashioned customization• Impersonality if your portfolio is not big enough
Traditional players vs. Robo advisors
Robo-Advisors:
Pros:• More cost efficient than traditional players• Lower initial investment required• Your rich level does not count, all clients are equal• Excluding the emotional factor
Cons:• The scope is limited, so no comprehensive financial
planning• Non individual goal and risk-tolerance profiling• Overmuch automatic• Limited set of funds you can invest in• Impersonal: no chance to ask from a human
Traditional Financial Advisory Firms
Pros:• Personal contact during a phone call or a meeting• Flexible, because you can make real-time
decisions and not blocked by algorithm• Wide-range of knowledge and expertise you can
count on
Cons:• High level of entry “fee”• Sometimes one for all products because of the
company push• Slow technology adopters• Old fashioned customization• Impersonality if your portfolio is not big enough
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Dedicated project team
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Use the latest technology
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Use the latest technology
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Virtual AdviceVirtual Advice
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Chatbot in wealth management & financial planningChatbot in wealth management & financial planning
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Thank You!Imre Rokob
Thank You!
DORSUM CO. LTD. | H-1012 Budapest, Logodi street 5-7. | Phone: +36 (1) 487 3030 | www.dorsum.eu