In the fast-evolving landscape of wealth management, client engagement is no longer just about portfolio performance. It’s about trust, communication, and, increasingly, personalisation. A recent study by Capgemini’s World Wealth Report 2024 highlights a critical concern: 65% of high-net-worth individuals (HNWIs) express dissatisfaction when they receive generic, non-personalised advice, especially during volatile markets. When clients feel disconnected from their investments, they are more likely to make emotionally driven decisions, derailing long-term financial goals.
Yet, many wealth managers rely on generic communication templates that fail to resonate on a deeper level with clients. This may stem from a lack of accessible tools or resources that allow for scalable, personalised reporting. Traditional reporting processes can be time-consuming and resource-intensive, which may lead wealth managers to opt for simpler, one-size-fits-all communication formats. Without the right technological support, it can be challenging to deliver the frequent, in-depth insights that clients need, especially when managing a large number of portfolios. However, this lack of personalisation can undermine trust and create a gap between portfolio managers and their clients. Clients often feel left out of critical discussions about their own financial futures, particularly during market downturns when they need reassurance the most.
The Impact of Poor Client Communication
The ramifications of inadequate communication are significant. According to a YCharts survey, nearly 50% of clients wish their advisor would contact them more frequently. This statistic spikes to over 60% among clients over 60 years old or those with more than $500,000 in assets under management. Moreover, 9 out of 10 clients report that the frequency of communication plays a major role in whether they would remain with their advisor and even make referrals, reinforcing how essential communication is to retention and growth.
When communication is sparse or generic, clients are left to fill in the gaps themselves, often turning to external media sources, which can mislead or amplify fears. Particularly in times of economic uncertainty, this lack of clarity can lead clients to make rash decisions, like selling off assets prematurely, a behaviour that could easily be mitigated with more timely and relevant communication.
The Role of Personalised Communication in Mitigating Emotional Decisions
Behavioural finance tells us that emotions can significantly impact investment decisions, especially in volatile markets. Without a clear understanding of how their money is being managed, clients are more prone to biases like overconfidence, risk aversion, or loss aversion. This leads to poor decision-making, such as panic selling during downturns or holding onto underperforming assets for too long.
Capgemini’s research shows that wealth managers who leverage AI-driven personalised reporting and behavioural insights can better manage client emotions and improve overall decision-making. This is where hyper-personalisation comes into play. 75% of Wealth Management CXOs believe AI will be most impactful in automating manual processes, generating intelligent insights for portfolio optimisation, and personalising client communication, a clear indication that the industry is pivoting toward more customised client interactions.
Aivodot PRO: Delivering Context through Hyper-Personalised Reporting
Aivodot PRO has developed a reporting solution powered by generative AI that directly addresses these challenges, enabling wealth managers to not only communicate more effectively but also scale their efforts without compromising on personalisation. This reporting feature isn’t just about data—it’s about context. Clients receive customised news highlights that link directly to their holdings, improving their understanding of portfolio performance and market events driving those results.
Moreover, Aivodot’s reporting engine allows portfolio managers to incorporate their own views and comments into portfolio summaries, providing critical context around performance and market conditions. These insights help clients see not only what is happening but also why it’s happening. The manager’s comments can be integrated into reports across all portfolios simultaneously, while still ensuring that each report is tailored to the individual client and their specific portfolio.
Context doesn’t end there. Adjusting the tone and language of reports to match each client’s level of investing experience, as well as their native language, further strengthens engagement. Clients are more likely to understand and appreciate the complexities of their investments when information is communicated in a way that resonates with them. This, in turn, enhances trust and helps prevent emotionally driven decisions.
Conclusion: The Future of Client Communication
The evidence is clear: clients demand more personalisation in their wealth management services, and the tools to provide that are already here. Firms that adopt hyper-personalised reporting solutions, like Aivodot PRO, will not only increase client satisfaction but also strengthen long-term relationships, leading to higher retention and referral rates. In a world where nearly 90% of clients consider communication style when deciding whether to retain or recommend their advisor, wealth managers can no longer afford to ignore the importance of tailored, frequent, and transparent communication.
Aivodot PRO’s AI-powered reporting makes this transformation seamless and scalable, ensuring that every client feels understood and valued.
References:
Capgemini. World Wealth Report 2024: https://www.capgemini.com/insights/research-library/world-wealth-report/
YCharts. How Can Advisors Better Communicate with Clients: https://go.ycharts.com/hubfs/How_Can_Advisors_Better_Communicate_with_Clients.pdf
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