The investment & wealth management industry is going through a monumental digital shift. Before 2020, digitalisation had long been predicted, but both investors and firms were relatively slow to demand or implement change: meetings mainly took place in person, conference calls were made over the phone, and digital upgrades were put off.

Then, when the pandemic hit everything changed, creating the perfect storm to accelerate digitalisation. Adoption of digital technology became mandatory for wealth businesses to operate at all, posing new challenges and opportunities for wealth managers to navigate and take advantage of. Almost overnight, business models evolved, and client expectations rose. But now, clients find themselves ever more reliant on new technologies and are providers actively prioritising digital innovations as fee structures are once again questioned.

Deloitte's recent study in conjunction with ESI ThoughtLab – Wealth and Asset Management 4.0 – show that 40% of clients now say digital access has greater importance in decision making. And three-quarters of wealth firms believe that investors primary engagement channel will be digital within two years.

Wealth firms see great opportunity for better outcomes as a result of the digitalisation of infrastructure:

"Every company is going through digital transformation, and it will continue forever. As technology gets more sophisticated, wealth management firms will find new ways to understand their clients and serve them better. Every side of the business will go through digital transformation, from onboarding and transactions to wealth management advice." 

The early shifting signals

So, what has driven 75% of wealth executives to think digital will be the default interaction? Mobile technology. Apps have fast become the primary medium of client engagement, and they've taken over from websites, phone calls, in-person meetings, email, messaging, and texting. And the customer experience expectation has never been higher. The potential convenience of having everything both investors and firms need in one place, on mobile, is unparalleled.

Clients now seamlessly and securely manage their wealth whilst gaining advice, insights, and relevant content in one place.

Of course, striking a balance between high-tech delivery and a high-touch approach will be tricky. But as the research shows, companies that embrace digital transformation will, on average, increase productivity by nearly 14%, AUM by 8.1%, and revenue by 7.7%. Suggesting the rewards of shifting to digital certainly outweigh the initial effort.

This post was  first published on the Deloitte UK Financial Services Blog

Key contacts

Jean-François Lagassé - Managing Partner, Financial Services Industry, Switzerland

Jean-François is the Swiss Financial Services Industry Leader and a Partner within Deloitte Switzerland’s Financial Advisory business. He also leads our Global Wealth Management segment and is a member of the Swiss Executive. He has more than 20 years of professional experience in the field and has worked in the United States, Canada and Switzerland. Jean-François has successfully completed numerous M&A advisory and valuation mandates in sectors such as financial services, technology and telecom industries.

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Patrik Spiller - Partner, Monitor Deloitte Strategy Consulting and Wealth Management Industry Lead

Patrik leads Strategy and Analytics in Switzerland as well as the Wealth Management Industry Practice in North South Europe. He has 20 years of experience in banking industry consulting. He supported many leading international banking institutions and wealth managers in the development of innovation and transformational strategies, technology and operational strategies as well as shaping cost reduction programmes.

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