Recent research by the wealth management benchmarking firm suggests that there has been a 20 per cent increase in clients switching wealth manager over the past three years.
When asked why they might switch, 22 per cent of the 1,000 end-investors surveyed cited investment performance as the most important consideration when choosing a new wealth manager. The level of fees and quality of service was only listed as the most important by 14 per cent.
However in ascertaining the motivations of those already considering a move, the data suggests a significant reduction of more than 20 per cent in fees would be the key to them switching.
This is positive news for those in the digital wealth management sector, where fees are already coming in at below than the market average, with a general range of 0.4 to 0.75 per cent for fixed and fully managed portfolios.
In addition, the ability to access one’s portfolio in a digital format is becoming more important, despite the slow adoption rate from traditional investment firms.
“Digital capabilities are a key consideration for many investors, with over two thirds of those asked (66 per cent) rating the digital offering of their main provider as either ‘good’ or ‘excellent’,” said James Brown, head of client services at Compeer.
"Over half (58 per cent) currently access their investment portfolio online and a fifth (22 per cent) via mobile."
As we head into the digital age, Brown believes providers should encourage a deeper integration of online and mobile functionality into their services if they are to remain relevant.
"With so many investors more empowered to compare and contrast providers, it is essential that wealth managers embrace new capabilities – be that by offering access to portfolios via mobile, or deep-diving into newer, more advanced technologies.
"Wealth managers need to future-proof now or they risk missing out on the next generation of investors who have grown up organising every aspect of their lives online and are used to that convenience.”
