Big tech companies are everywhere in our lives, but is wealth management their next frontier? Probably not, but a sizable number of people surveyed by Accenture answered in the affirmative when asked if they would consider using Google, Apple or Facebook if these companies had a wealth and money management offering.
The question was part of a wealth management consumer report entitled, “The New State of Advice,” from Accenture, a global professional services company. One of the study’s big takeaways is that the next generation of investors have different needs and wants than their parents, and that financial advisors who fail to provide the holistic advice and products they want, along with the digital and personal engagement model they desire, will be losers in the intergenerational wealth transfer.
Regarding the question that asked if people would turn to Google, Apple or Facebook for wealth and money management services if the companies offered them, 69% of respondents said they would. Not surprisingly, that number was much higher among the Generation Z and millennial cohorts at 95% and 83%, respectively.
According to Accenture, the reason for these high numbers relates to what these companies provide consumers in terms of easy access to information, technology tools, integration of personal and financial data, and a track record of innovation.
“These investors have expectations that have been set by the simplicity and seamless experience they’re getting from big tech,” Rachel Silver, managing director of capital markets and wealth management at Accenture, said in an interview.
“And they expect that same experience when it comes to managing their money and getting advice,” she added. “However, big tech companies can’t offer all of the products that we know that investors want. Investors want advice across a broad spectrum of products, including banking and lending products, insurance and tax advice.”
The Accenture report said an emerging class of newly engaged investors have zeroed in on the likes of cryptocurrencies and environmental, social and governance (ESG) investing. And they—and other investors—don’t want general advice seemingly ripped from the pages of a Wealth Management 101 textbook.
For example, nearly 90% of mid-high-net-worth investors with $10 million or more in personal wealth said the advice their advisor provided was too generic.
“There’s an increased appetite for advice underpinned by tailored educational content and products that is highly customized to clients’ point-in-time needs and investment preferences,” the report said.
So while clients of financial advisors seek perspective on risk management and asset protection, they also want products offering protection against future events or that can meet a specific and targeted need outside of asset growth, such as banking and insurance products. The report found that 79% of investors, including 85% of Generation X and 91% of millennial investors, expect their advisor to offer banking and insurance products.