What wealth managers need to boost clients

13 June 2018

While client referrals remain the biggest means of acquisition, wealth managers reaching out to high net worth (HNW) clients should embrace inter-departmental collaboration to beat their competition, says GlobalData.

The company’s report found more than one third of HNW entrepreneurs have been sourced through client referrals, but wealth managers need to “up their game” when reaching out to these clients.

The second most effective method of client acquisition was external referrals from partner companies at 14.5 per cent, followed by relationship managers’ own contacts (13.4 per cent), internal referrals: retail bank (12.6 per cent) and internal referrals: investment bank (7.8 per cent).

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Wealth management senior analyst at GlobalData, Heike van den Hoevel, said the sheer size of the market has given rise to fierce competition, with the majority of wealth managers operating dedicated programs for entrepreneurs.

Hoevel said referrals from an investment or business banking department could prove more effective.

“Referrals from one’s investment or business banking department do not only provide an important source of new business, but allow wealth managers to service clients more effectively, and increase fee income by leveraging cross-selling opportunities,” he said.

The analyst said while wealth managers needed to ensure staff understood other products, well-defined incentive structures were needed to foster a culture that promoted interdepartmental collaboration and encouraged staff to share customer information.

“Providers that are able to leverage their wealth management as well as investment and business banking capabilities will be well placed to generate additional business through referrals and boost their bottom line thanks to increased product sales.”


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