Client Acquisition – A Failure of Leadership?

Felix Thomson

Content Executive

The Financial Services Forum

The private banks have not been as successful as they would like in attracting new high net worth customers – often because they are seen as sales orientated rather than specialised asset managers. Michael Maslinski analyses where they are failing and suggests how to turn things around and build trust.
There has been a great deal of comment in recent months that, with a few exceptions, private banks and wealth managers are underperforming in the vital areas of new client recruitment. A strong client acquisition process is central to the wealth management business model and the problem may go far deeper than some commentators suggest.
It is indeed quite remarkable that, in such a fast growing sector, after another three years of bull market, most private banks and wealth managers are apparently still struggling to attract new clients in sufficient numbers. On the face of it, there are only four possible explanations:
1. Despite strong market growth, there are too many wealth managers chasing too few clients
2. The clients are there, but the service offered by wealth managers is not meeting their needs
3. The service is right but is not being clearly or convincingly communicated
4. Most of the business is going to a small number of wealth managers who have designed, implemented and communicated their offering far better than the rest
The evidence
The true explanation is a combination of all the above. The private client sector would not be the first ‘overhyped’ industry to have attracted too many competitors chasing a fast growing but nevertheless finite number of customers. This, however, does not explain numerous market surveys which suggest substantial unmet demand.
If the market is oversupplied, it is all the more surprising that most potential clients have never received a credible marketing approach from a prospective wealth manager. What on earth, you may ask, are these wealth managers doing to search for new business, if their message is failing to reach a large percentage of their target clients?
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