Continue on the growth path Consulting and understand the evolving expectations, needs and expectations of the next generation of clients and consultants. With this objective, the Italian Private Banking Association (AIPB) made with Accenture the research “Financial consultancy for the Next Gen: new models for tomorrow's investors and professionals”.
“As Private Banking we have achieved extraordinary results over the last 15 years, having as interlocutors our customers belonging mainly to the silent generation and baby boomers - three quarters of the assets managed by our Industry belong to an over 55 decision maker -; now the time has come to open up to the new generations and guide the generational turnover of both our Private Bankers and our customers", he highlighted Andrea Ragani, President of AIPB.
And how to achieve this result? “We have to attract young talents offering increasingly inclusive ways of working based on growing intergenerational dialogue – continued Ragaini -. Thanks to the contribution of these new professionals, the Industry will be able to design those increasingly digital, advanced and efficient consultancy services that are required of us by the Millennials and Gen X".
The growth of Private Banking
Since 2007 Private Banking has recorded a rapid growth (+6,6% CAGR of assets under management), higher than the evolution of household wealth (+1,4%) and GDP (-0,3%). A path of development and consolidation of the service model that has led the Industry to manage over 70% of its market of choice, that of households with investable financial portfolios exceeding 500 thousand euros (in 2022 the potential market of Private Banking is amounted to 1.360 billion euros).
The new market, to be analyzed today in order to be able to conquer it tomorrow, is that of individuals with high potential aged between 26-41 years (Millennials) and between 42-57 years (Gen X): interested in efficient and advanced financial advice, their financial wealth is estimated at around 600/700 billion euros.
Digital and human mix, here are the needs of the Next Generation
To address these new challenges, the research was carried out by interviewing savers between the ages of 26 and 55, customers of the main traditional and online Italian banks. The customers sampled in the survey have an annual savings capacity of around 5 thousand euros. The size of the assets of this target is, in most cases, less than 500 euros, but more than 40% of the interviewees declare financial resources between 75 and 500 euros.
The main evidence Research shows that respondents have:
- a digital approach: 80% use digital for banking activities;
- the lack of a professional consultancy service: only 39% of the sample declares that they own an investment product; 28% own insurance and protection products and these values drop further with regard to credit products, 20% for mortgages and 12% for loans;
- the desire for professional support at key moments: 86% of those interviewed who experienced a digital consultancy service did so through human support and 83% declare themselves interested in having support at relevant moments, such as the request a loan for the purchase of a first home;
- the preference for an essential relationship with one's bank: 80% favor an effective response to solve the problems encountered rather than an ongoing relationship;
- a significant interest in services with hybrid characteristics: 80% declare themselves interested in a model that mixes digital and human support. It would also be willing to evaluate a change of institution in order to take advantage of a service with these characteristics.
The new consultancy model according to Accenture
To play a leading role in the transition to the new consulting model, according to Accenture, the Private Banking offer should take into consideration digital evolutions such as:
- the smart relationship mode, thanks to the combined use of pure digital experience, carried out independently, and the support of the consultant in key moments for the client;
- the user-friendly digital platform, which allows simple and intuitive planning by objectives;
- the dedicated online offer of both investment services and banking services, able to satisfy all customer needs to become their point of reference;
- the transition from a client-consultant logic to a "lean" one characterized by shared clients managed in teams to promote greater dissemination and scalability of the consulting service;
- collaboration with other existing supply chains, through the activation of partnerships to maximize synergies and avoid conflicts;
- a new figure of Next Gen consultant with a different profile compared to the traditional banker: a junior profile, recent graduate, focused on commercial development, with a remuneration and initial endowment of customers for a better balance between professional autonomy and integration into the company;
- an attractive brand capable of representing authority in the field of asset management towards customers.
“Today the players in the sector are faced with the challenge of how to be attractive to the new generations. Our research has shown that this type of saver prefers a digital human service mix different from the current models, based exclusively on consultancy and that the result of this mismatch is that part of the wealth is not managed", he said Andrea Gifts, Accenture Capital Markets Industry Lead.
