Wealth Management for Women
-
Upload
cp-mario-perez-lopez -
Category
Documents
-
view
215 -
download
0
Transcript of Wealth Management for Women
-
7/29/2019 Wealth Management for Women
1/12
Leveling the Playing FieldUpgrading the Wealth Management Experience for Women
Peter Damisch, Monish Kumar, Anna Zakrzewski, and Natalia Zhiglinskaya
July 2010
-
7/29/2019 Wealth Management for Women
2/12
T B C G J
As wealth management clients, wmen are bth signicant an nervale. The cntrl abt
27 percent the wrls wealth (meaning that the ecie where the assets are investe), et
mre than hal the wmen we srvee eel that wealth managers cl a better jb
meeting the nees emale clientsan nearl a qarter think that wealth managers cl
signicantly imprve hw the serve wmen.
The srve, cncte in earl 2010, was prmpte b r annal glbal-wealth research, which shwe a
isparit between the signicant nmber wmen clients an the level service the tpicall receive.
The srve ha abt 500 respnents, each with at least $250,000 in bankable assets. It was cmplement-
e b mre than 70 interviews with private-banking specialists an wealth wmen arn the wrl.
Man wealth managers either verlk wmen as a iscrete an imprtant grp r else se spercial
strategies t reach them. In act, sme the mst cmmn appraches are wrse than ineectivethe
can alienate the ver clients there meant t attract, particlarl i the revlve arn wmen-labele
prcts, pitches, r prmtins that cme acrss as patrnizing r cntrive. Wealth managers nee a
mre nance apprach.
Wmen tl s, in n ncertain terms, that the want a level plaing elthe want the same attentin,
avice, an terms an eals that men getwith avisrs prviing clear an bjective recmmenatins
base n their gals an risk prles. At the same time, hwever, mre than 70 percent the respnents
sai that wealth managers shl tailr their services r wmen. This ma seem cntraictr, bt the
esire r a tailre apprach is reall a sign that wmen have istinct nees an expectatins as clients,an that private banks have mre wrk t when it cmes t the mst imprtant axim in wealth
management: know your client. Pt simpl, wmen want their avisrs t nerstan wh the are an
what the want.
Leveling the plaing el presents a signicant pprtnit r wealth managers, man which are
ghting harer than ever t win back r retain clients. B recgnizing bth the imprtance wmen an
the reasns wh s man are isappinte with the instr, wealth managers can attract new clients an
strengthen lalt. An the can s b ne-tning, rather than reinventing, their apprach t serving
wmen clients.
An Increasingly Wealthy and Independent Group
Wmen cntrlle an estimate 27 percent, r abt $20 trillin, the wrls wealth in 2009.1 (See
Exhibit 1.) The percentages were highest in Nrth America (33 percent), Astralia an New Zealan (31
percent), an Asia (29 percent, ex Japan), an mch lwer in Latin America (18 percent), Japan (14 per-
cent), an Arica (11 percent). In Erpe, the percentage was highest in Western Erpe (26 percent) an
smewhat lwer in Rssia (21 percent) an Eastern Erpe (19 percent, ex Rssia).
Nrth America an Western Erpe accnte r mre than tw-thirs, r $14.3 trillin, the wealth
cntrlle b wmen. These are the tw largest wealth markets in the wrl, accnting r abt tw-
thirs glbal wealth as wellbt the als ha relativel high percentages wmen-cntrlle wealth.
Histricall, wmen in these regins have ha g access t pressinal an ecatinal pprtnities.
Leveling the Playing FieldUpgrading the Wealth Management Experience for Women
1. All igres in this paper that reer t wmen-cntrlle wealth are base n estimates wealth wne b clients with at least$250,000 in assets ner management (AM).
-
7/29/2019 Wealth Management for Women
3/12
T B C G J
Leveling the Playing Field 2
While the percentage wealth cntrlle b wmen has change nl graall ver time, the amnt
wealth cntrlle b wmen has been n a rllercaster rie since the start the nancial crisis, mirrr-
ing the verall mvement in glbal AM. Aer alling sharpl in 2008, the amnt wmen-cntrlle
wealth increase b 16 percent in 2009. (See Exhibit 2.) It grew b nearl 30 percent in Asia (ex Japan) an
b 24 percent in Astralia an New Zealan. In all ther regins, it increase b anwhere rm 13 t 18
percent, except in Japan, where it grew b nl 2 percent.
The amnt wealth cntrlle b wmen is expecte t grw at an average annal rate 8 percentrm ear-en 2009 thrgh 2014, slightl abve the 7 percent rate rm ear-en 2004 thrgh 2009.
Emerging markets are expecte t take a characteristic lea in the grwth wmen-cntrlle wealth
an wealth in generalver the next several ears.
Several lng-term trens have ele the grwth wmen-cntrlle wealth. first an remst, wmen
have becme mre active in the wrkrce. frm 1980 t 2008, the nmber wmen in the glbal
wrkrce ble t 1.2 billin. Whats mre, the incme gap between men an wmen has ecline, s
wmen are bth wrking mre an earning mre. These changes have le t an increase in the prprtin
wmen whse wealth is entirel sel-earne. In r srve, 42 percent the respnents erive all
their wealth rm their wn salaries an bnses.
Secn, as a reslt wrking mre an accmlating wealth, wmen have gaine bth the cnence
an the experience t becme mre invlve in amil nances. Wmen nt nl earn mre themselves,sai Pressr Thmas dren, irectr the Institte r the Science Ethical Wealth at Sigmn
fre universit, bt ver the last ecae r tw, the have cme t pla an increasingl imprtant rle
in managing a amils mne.
Thir, mre wmen are inheriting wealth, wing t their lngevit. As a reslt, wmen are mre likel t
assme cntrl ver lmp sms wealth. In sme cntries, particlarl in the Mile East an Asia,
wmen cntine t inherit less wealth than men, bt the gap is narrwing as these scieties cme t
accept the legitimac wmen as primar inheritrs.
The three trens have imprtant implicatins r wealth managers:
Wmens wealth will cntine t grw. We expect the increase t be riven mainl b salaries an b-nses, which will grw in line with wmens ecatinal an pressinal evelpment, as well as b the
cntine narrwing bth the incme an inheritance gaps.
9.0 0.5 2.8 5.3 0.5 0.1 0.04 0.4 1.5 0.04 20.2
AuM controlled bywomen, 2009 (%)
40
30
20
10
0
3331 29 26
22 21 19 18 14 11
27
NorthAmerica
1
Australia andNew Zealand
Asia(ex Japan)
WesternEurope
MiddleEast
Russia
Eastern Europe(ex Russia)
LatinAmerica
2
Japan
Africa
Global
AuMcontrolledby women($trillions)
Exhibit 1. Women Control 27 Percent of Global Wealth
Source: BCG Global Wealth Market-Sizing Database, 2010.
Note: AuM controlled by women represents wealth that is invested on the basis of decisions made by women; data reflect wealth ownedby women with more than $250,000 in AuM. AuM in 2009 was calculated using 2008 U.S. dollar exchange rates.1The United States and Canada.2South America, Central America, and Mexico.
-
7/29/2019 Wealth Management for Women
4/12
T B C G J
Leveling the Playing Field 3
Wmen will accnt r a grwing prprtin high-net-wrth (HNW) clients, which are generall ene as having between $1 millin an $20 millin in wealth. Several private-banking experts nte
that wealth managers nee t be prepare r an pwar migratin wmen int the HNW segment,
especiall in the emerging markets.
Wmen will becme mre inepenent when making nancial ecisins. In r srve, 30 percent
wmen sai the make their investment ecisins alne rather than reling n a spse r ther amil
members. We expect this percentage t rise as wmen accmlate bth nancial experience an wealth.
The tren will be mre prnnce in markets that have high levels entreprenerial activit. We are a
ng market, remarke an Eastern Erpean private banker, an mre than hal r emale clients
are entrepreners. Their prcienc level in nancial matters is similar t that men.
An Uneven Playing Field
Man rivers issatisactin with wealth managers are niversal rather than specic t wmen clients.
fr example, 18 percent r respnents were issatise with cmmnicatin an reprting an 14
percent were issatise with the qalit avice. (See Exhibit 3.) other perennial isses pppe p as
well, sch as the pr accessibilit avisrs, the lack tailre sltins (ne size es nt t all),
an the verabnance breacrac an paperwrk.
Sme 27 percent the wmen srvee were nt satise with their private banks, largel becase the
actrs escribe abve. The level iscntent was highest amng wmen with $1 millin t $5 millin in
AM. Clients in this segment, bth men an wmen, smetimes eel caght in the mile: their invest-
ment nees are t sphisticate t be llle b a retail bank, et the eel t insignicant, given their
level wealth, t reall matter t a private bank.
Bt the srve als reveale isses that were niqe t wmen. The majrit srve respnents
AuM controlled by women, 2009 ($trillions)
517
2014
11.7
2009
9.0
2008
7.7
913
2014
7.9
2009
5.3
2008
4.7
1317
2014
0.2
2009
0.1
2008
0.1
1429
2014
5.3
2009
2.8
2008
2.2
22
2014
1.6
2009
1.5
2008
1.4
816
2014
29.0
2009
20.2
2008
17.3
524
2014
0.6
2009
0.5
2008
0.4
1318
2014
0.6
2009
0.4
2008
0.3
1915
2014
0.1
2009
0.0
2008
0.0
815
2014
0.8
2009
0.5
2008
0.5
815
2014
0.1
2009
0.0
2008
0.0
Compound annual growth (%)
North America1
Middle East
Asia (ex Japan)
Africa
Australia andNew Zealand
Latin America
2
Eastern Europe(ex Russia)
RussiaWesternEurope
Japan
Global
Exhibit 2. Women-Controlled Wealth Made a Strong Comeback in 2009
Source: BCG Global Wealth Market-Sizing Database, 2010.Notes: AuM controlled by women represents wealth that is invested on the basis of decisions made by women; data reflect wealth ownedby women with more than $250,000 in AuM. AuM in 2009 and 2014 were calculated using 2008 U.S. dollar exchange rates. Projections for2014 assume that the share of wealth controlled by women remains stable over the next five years.1United States and Canada.2South America, Central America, and Mexico.
-
7/29/2019 Wealth Management for Women
5/12
T B C G J
Leveling the Playing Field 4
55 percentelt that wealth managers cl a better jb meeting the nees wmen. (See Exhibit
4.) Twent-r percent thght that private banks clsignicantly imprve hw the serve wmen. The
issatisactin stems almst entirel rm the nshakable perceptin that the plaing el is nt even
that men get mre attentin, better avice, an smetimes even better terms an eals. This sense
sbrinatin was repeate time an again in r interviews:
Eqal access t inrmatin, eqal cnsieratin an terms r lans, eqal access t
special eals ging n at the bankthats what I am lking r.
Married, North America
Asie rm nt taking wmen serisl in general, [wealth managers] shl be csing n
generating the best retrns r the client, regarless gener. I nt nee a tea part. Single, North America
What banks nee is a revltin like the atmtive instr ha: t nall nerstan
that wmen nt nl sit in the cars bt als chse, b, an rive them.
Married, Spain
Banks are spening their marketing bget n men b spnsring sprts sch as tball r
rgbMale clients als get invite t crprate bxes at games, bt as a wman I nt get
that kin treatment.
Married, New Zealand
The prblems that case wmen t eel like secn-class clients are eep-seate. The stem rm experi-ences in the avisr prcess as well as rm the cmmnicatin stle private banks an relatinship
managers (RMs).
Level of satisfaction with wealth managers(% of respondents)
Key areas that needto be improved (% of respondents)
80604020 1000
80604020 1000
$250,000$500,000
$500,000$1 million
$1 million$5 million
$5 million$50 million
Very dissatisfied
Somewhat dissatisfied
Somewhat satisfied
Very satisfied
Nothing
Performance
Product offering
Services
Bureaucracy/flexibility
Accessibility/convenience
Pricing
Being proactive
Trust
Managing women-specific issues
Advice quality/guidance
Tailored, goal-oriented approach
Communication/reporting
14 43 43
0
13 53 2014
32 47 192
24 55 192
18 56 206
20151050
18
15
14
11
8
8
2
4
5
5
5
2
1
Overall
ClientSegment
Exhibit 3. Discontent Is Highest Among Clients with $1 Millionto $5 Million in AuM
Sources: BCG Women in Wealth Management Survey, 2010; BCG analysis.Note: These results are based on responses from 168 participants; not every survey question was answered by all respondents.
-
7/29/2019 Wealth Management for Women
6/12
T B C G J
Leveling the Playing Field 5
The Advisory Process
The avisr prcess is at the heart the wealth management experience, an it trns almst entirel nan avisrs abilit t evelp alternatives an recmmenatins that are base n a clear nerstaning
the client. Man wmen, hwever, sai their avisrs r RMs assme that the have a lw risk tlerance
an ths prvie nl a narrw range investment sltins. Sme sai that the were given mbe
wn versins the stanar erings. others sai that their avisrs were t qick t cs n strat-
egies r prcts that have less an emphasis n perrmance, sch as sstainable r green invest-
ments, n the assmptin that wmen are mre attne t scial isses. feeling steretpe rather than
nerst, several wmen in r srve ha pte t manage their investments n their wn.
Sme wmen als eel that wealth managers nt pa engh attentin t circmstances that can
raicall change their pririties. A wmans investment nees an risk prle can be aecte b majr
lie changes, sch as marriage r ivrce, the birth a chil, r the eath a spse. The same can be
sai men, crse, bt the realit is that wmen are mre likel t have their nancial pririties
rearrange b sch events. Wmen, r example, are mre likel t rg earning an incme aer thebirth a chil. The are als mre likel t assme new nancial respnsibilities, smetimes with little
r n preparatin, as a reslt a ivrce r the eath a spse. All a sen I ha a lt mne
an ha t manage it, ne wman sai. Bt I nt have time r it. I wrk an take care m three
chilren.
Mre namentall, man wmen eel that the avisr prcess is geare twar shrt-term reslts, an
that it iscnts the signicance lng-term bjectives that reect the impact the majr milestnes in
a persns lie. This is a nctin incentive sstems an cmpan cltres, bt it is als a shrtct an a
smptm a spercial avisr-client relatinship. It takes time t nerstan a clients lng-term
bjectives. The RM i nt remember anthing that ha been iscsse in r previs meeting, an
knew nthing abt mer m sitatin, sai ne wman.
Communication StyleWmen were critical the emeanr their RMs. Man tl s that their avisrs nt take them
Still, the survey suggeststhat wealth managers need tomake subtle rather than
sweeping changes
80
60
40
20
100
0Strongly disagree
Somewhatdisagree
Somewhatagree
Stronglyagree
8
20
58
14
More than 70 percentof respondents believe thatwealth managers should
tailor their approach for women
More than half of respondentsbelieve that wealth managerscould improve their service
to women
"I believe a bank shouldhave a service approach
tailored for women."
80
60
40
20
100
0
No need forimprovement
Need forimprovement
Need forsignificantimprovement
45
31
24
Could your private bank improvehow it meets the needs of
women clients?
Productoffering
Servicemodel
Few respondentsraised issues withthe actual products
Many more highlightedproblems in the advisoryprocess, along with thecommunication style ofbanks and relationshipmanagers
% %
Exhibit 4. Women Want Wealth Managers to Recognize Their Needs
Sources: BCG Women in Wealth Management Survey, 2010; BCG analysis.Note: The question on the need for improvement had 141 respondents, and the question on having a tailored approach had 144respondents; not every survey question was answered by all respondents.
-
7/29/2019 Wealth Management for Women
7/12
T B C G J
Leveling the Playing Field 6
serisl, which mae r -ptting an smetimes hmiliating interactins. one wman sai that her
bank aresses letters t her hsban, even thgh she manages their investments. Several tl s that
their RMs atmaticallan cnspicslassme that the man has the nal sa abt an invest-
ment. M hsbans incme is lwer than mine, an that is a sitatin that banks in German nt
knw hw t eal with, remarke ne wman. The alwas ecie that there mst be sme mistake,
which makes meand m hsbaneel ncmrtable.
Why Do So Many Wealth Managers Miss the Mark?
When it cmes t avising wmen, man wealth managers are ptting the accent in the wrng place.
The ten t alter their avice base n steretpes that the shl ignrewhile verlking material
ierences between men an wmen as wealth management clients.
Steretpes, b enitin, are versimplicatins an can lea t awkwar exchanges an straine
relatinships. Still, r srve an interviews, cple with past BCG research an prject experience
cmparing the investing preerences wmen an men, trne p several imprtant traits share b
man emale clients.2 These traits, in trn, lea t expectatins that set man (bt b n means all)wmen apart rm men.
Women oen focus on long-term investment goals and seek holistic advice.Wmen ten t set clear
galssall in respnse t, r in anticipatin , the lie changes mentine earlieran the want
their investment strateg, an its nging exectin, t revlve arn these bjectives. Wealth is a
means lie planning rather than a gal in itsel, remarke ne srve respnent. This perspective
has two important implications for wealth managers:
first, wmen are mre intent n nerstaning the risk-retrn prles investments as the relate t
their verarching gals an nancial secrit. B the same tken, the are less likel t be istracte b
shrt-term perrmance. This lng-term view is reecte in wmens investment strategies. Mre than 70
percent the wmen in r srve avr balance r cnservative investment strategies; amng wmenler than 50, the percentage is clse t 95 percent.
Secn, becase their gal-riente minsetan, in sme cases, the pressre t manage bth career
an hsehl respnsibilitiesmst wmen want avice an prct inrmatin that is nt mle
b nnecessar etails. I want statements that are clear, eas t rea, an can be interprete n n sleep
r while parallel-prcessing amil chres r wrk, ne wman sai. on r hrs sleep, while n a
cnerence call rm wrk, I want t be able t srt thrgh persnal nancial things. yll almst never
have m ll attentin, s make [the reprting] eas, clear, an hnest.
Empathy matters. Men ten t view their wealth-management relatinships thrgh a bsiness-riente
lens. Their avisrs can establish trst airl qickl b acilitating ecient transactins an elivering
shrt-term reslts. Mst wmen, n the ther han, want their banking relatinships grne in empa-
th an cstmize avice. Ever relatinship is persnal, sai ne wman, incling a banking ne.fr mst wmen, trst evelps slwl an is base n an avisrs abilit t recgnize an respn t her
lng-term bjectives. A small minrit wmen believe that emale RMs wl be better at biling sch
relatinships, bt the vast majrit are inierent t the gener their avisr. (See the siebar Are
female RMs Better at Cnnecting with Wmen?)
Women are eager to learn. Interviews with clients an private bankers inicate that man wmen are as
sphisticate in nancial matters as men. Bt cmpare with men, wh en hie their lack knwlege
abt nancial matters, wmenregarless their level nancial knwlegeare generall pen t
learning abt investments an wealth management thrgh seminars r ther events.
2. fr mre n BCGs research int the emale ecnm, see Wmen Want Mre: Hw t Captre More Than yr Share thefemale Ecnm, BCG opprtnities r Actin, Agst 2009, an Wmen Want Mre (in financial Services), BCG opprtni-ties r Actin, octber 2009.
-
7/29/2019 Wealth Management for Women
8/12
T B C G J
Leveling the Playing Field 7
These generalizatins shl nt be taken as hl writ, crse, bt the she sme light n wh
wmen are issatise with private banks. The als prvie a sel backrp r nerstaning wh s
man private banksespite recgnizing an targeting ther iscrete grps clients, sch as ctrs r
lawersstill have a service gap between male an emale clients.
The gap varies amng wealth managers. At ne extreme are private banks that simpl nt acknwl-
ege wmen as an imprtant segment. Man Erpean banks, in particlar, see wealth wmen as t
small a segment t jsti a separate apprach. other banks nt see wmen as a istinct client grp.
Wmen nt nee a ierent apprachthe want the same service an prcts as men, sai a
Erpean banker. This is tre, crse, bt it is nt the whle str.
other banks believe that wmen, as a grp, are bth imprtant an istinctbt the havent llwe
thrgh b researching wmens preerences r evelping strategies t aress their nees. In manemerging markets, where wealth is grwing at abve-average rates an the avisr bsiness is still
expaning at a nice pace, banks have less incentive t invest in a mre sphisticate segmenting clients.
Instea, the rel n traitinal metrics sch as risk prles an levels wealth.
Sme banks have wmen-cse initiatives. In man cases, hwever, these erts invlve little mre
than repackage prcts r targete marketing campaigns. Sch erts can easil cme acrss as sales
pls rather than meaningl attempts t eliver smething that wmen vale. The ma even alienate
mre clients than the attract. I nt think anne shl have a wmen-cse apprach, sai ne
wman. The shl be tailring their apprach r everneSme tr b ering pink st, which is
a bit cntrive.
A small nmber banks have evelpe geninel persnalize erings that avi cming acrss assimplie r patrnizing vertres an actall respn t the nees an expectatins wmen clients.
one Erpean bank, r example, reene its apprach t acqiring an serving wmen an nw
The proportion of female RMs, based on estimates
developed through our research and interviews withprivate bankers, ranges from 10 percent in the Mid-
dle East to 60 to 65 percent in Asia and Eastern Eu-
rope. In Western Europe, 25 to 30 percent of RMs are
female.
Experts in private banking told us that female RMs
are generally very good at forming strong relation-
shipsregardless of the clients gendermainly be-
cause they tend to be more empathetic and are more
likely to establish a personal connection with the cli-
ent. In some regions, such as Eastern Europe, female
RMs are also considered more trustworthy and reli-
able than male RMs. It should follow, then, that fe-male RMs would be better at developing client rela-
tionships with women.
In our survey, however, 85 percent of women said
that they were indierent to the gender of their RM.
They cared much more about the advisors personal-
ity and qualications. I want the best person for the
job, said one respondent. Only 11 percent said that
they preferred having a female RM; these respon-
dents said that a female RM would better under-
stand their needs and would be less intimidating
and more down to earth. The remaining 4 percent of
women were worried that female RMs might betime-pressured (having to juggle a family and a ca-
reer) or more likely to take time o.
Although most women are not concerned about hav-
ing a female advisorand the common practice
among banks is to match clients with RMs based on
the compatibility of their personalitiesthere is still
an argument for wealth managers to actively recruit
women, in part to increase diversity in the workforce
but also to capitalize on female RMs strengths when
it comes to building relationships. Banks and broker-
age rms can make it easier to attract and retain fe-
male advisors through teaming or job-sharing mod-els, which ensure continuity for both the client and
the bank when an advisor takes maternity leave, for
example.
Are Female RMs Better at Connecting with Women?
-
7/29/2019 Wealth Management for Women
9/12
T B C G J
Leveling the Playing Field 8
generall reqires wealth planners t becme invlve earl in the relatinship, which helps ensre that
the nerstan the clients nees an are able t prvie hlistic avice.
Upgrading the Client Experience for Women
Private banks have g reasn t target wmen, given bth the issatisactin riven b gener-specic
isses an the sbstantial wealth cntrlle b this grp. Mst will n that the prblems are less abt
what the prvie r wmen, in terms prcts, an mre abt how the eliver their service. The
will als n a receptive aienceas nte earlier, mre than 70 percent the srve respnents
believe that wealth managers shl tailr their apprach r wmen.
T clse the service gap between men an wmen, wealth managers shl llw a set practices that
we call thefour Rsrecgnize, research, respn, an rene.
RecognizeThe senir leaership team shl signal t the rganizatin that wmen as a client segment are bth
istinct an imprtantan ptentiall nerserve. The shl als make a clear cmmitment timprving their apprach t serving wmen b mving awa rm spercial wmen-labele prcts
an twar a rene ering that resnates with wmen.
ResearchWealth managers nee t nerstan hw the nees emale clients ier rm thse male clients.
Reaching t irectl t clients might be the best wa t start. I expect [wealth managers] t n t
what I nee, sai ne wman, an nt t assme it. Private banks with avance market-research
nctins shl be able t pinpint isses that are specic t wmen an then translate these nings
int actinable insights. (See the siebar Hearing the Cnsmers Vice.) Bt the shl remember that
Generating and exploiting market researchknowl-
edge that brings a company closer to the hearts and
minds of its targeted consumerscan yield im-
mense impact, particularly in instances where com-
panies, at a systematic level, are blind to issues that
are critical to large groups of customers, as is the
case with women in wealth management.
Most companies, however, struggle to unlock the val-
ue of the market research function, also known as
consumer insight. This was a key nding of a Novem-
ber 2009 BCG report, The Consumers VoiceCan YourCompany Hear It? which benchmarked the consumer
insight capabilities of 40 companies in a range of in-
dustries.
Frustrations were evident among both the recipients
of market researchthe line managersand those
who generate the output. When asked whether con-
sumer insight teams consistently answer the ques-
tion So what? about the data they provide, only 34
percent of line managers said that they do. On the
other side of the coin, fewer than half of insight sta
thought that the business leaders in their organiza-
tion could pass a pop quiz on important facts aboutconsumers.
If companies are not hearing the consumers voice,
it is probably because they follow a hemmed-in ap-
proach to market research. The study identied four
stages of a companys consumer-insight capability.
At one end of the spectrumstage oneconsumer
insight is essentially an isolated order-taking func-
tion, walled o from critical business decisions. At
the opposite endstage fourit is a source of com-
petitive advantage. Its ndings inuence cross-rm
decisions such as acquisitions, prioritization of mar-
kets, and resource allocation. In our study, almost
90 percent of companies were still at stages oneor two.
To capture the full potential of consumer insight,
companies must improve the engagement model.
This involves, among other things, getting senior
managers involved and expanding the scope of the
function. Companies also need to improve the per-
formance of the function by upgrading capabilities
and focusing the team on the right activities and de-
liverables.
Hearing the Consumers Voice
-
7/29/2019 Wealth Management for Women
10/12
T B C G J
Leveling the Playing Field 9
the rivers iscntent can be cmplex an sbtlean will almst certainl var epening n the
clients lie stage, pressin, amiliarit with nancial matters, an ther actrs.
RespondAn initiative targeting wmen is nt ging t lea t a raical verhal the service apprach. In act,
sme the things that wealth managers shl not , in terms respning t wmen, might be jst as
imprtant as sme things theshould .
Product Oering. Wealth managers shl nt eceive themselves int thinking that the can clse the
gap b rebraning existing prcts. Man wmen, as nte earlier, n sch erts patrnizing. The
prblems that wmen encnter in private banking stem nt rm a lack sitable prcts bt rm a
lack hlistic avice. As ne private-banking specialist acknwlege, Banks are t prct-riente
Avisr has t be base n a better nerstaning the sitatins an nees each client.
Advice. Man wmen tl s that their gener shl have n bearing n the avice the receive. In trth,
hwever, emale clients en share sme imprtant characteristics. Private banks shl cs n these
cmmn traits, bt nt t the exclsin inivial characteristics. As alrea nte, wmen ten t
cs n lng-term bjectivesan t vale the big-pictre view mre than the technical aspects inivial prcts. RMs shl keep these characteristics in min.
The Role of the RM. The imprtance the RM cannt be verstate. Imprving the [avisr] talent
pl is mre imprtant than creating a wmen-eicate ering, sai ne banker. I a bank manages
t that, then the nerling interests a wman will be met as a matter crse b thghtl an
nerstaning sta. Mre specicall, wealth managers shl train their RMs t recgnize hw certain
lie events can alter wmens risk prles. Sch mments trth prvie an nparallele pprtnit r
avisrs t becme trste partners. At the same time, hwever, RMs mst nt be captive t steretpes.
Nt all wmen are risk averse, an the care as mch abt perrmance as men . Well-traine RMs
will recgnize that sme client traits are cmmn bt nne are niversal.
Communication. While emale clients bristle at steretpes, avisrs shl recgnize that certain kins cmmnicatin an interactin cl signicantl imprve their abilit t attract an retain emale clients.
This ichtmavi steretpes bt aress cmmnalitiesleas t several s an nts r RMs:
Cater to the client, not the gender. The cmmnicatin stle shl be etermine n a case-b-case basis
an shl acknwlege the wie arra client prles.
Show empathy and build trust. female clients are likel t vale these qalities mre than men .
Avisrs nee t listen t the client an alwas keep her verarching bjectives rnt an center.
Private banking is, aer all, a peple bsiness.
Recognize and address regional and country dierences. In the Mile East, r example, high ivrce rates
in sme cntriesan the vagaries the ispsitin wealth in a ivrce settlement r an inheri-
tance sitatincan make wmens nancial well-being smewhat precaris an lea them t givemre thght t their nancial inepenence an their wealth-management nees. (See the siebar
develping an oering r Wmen in the Mile East.)
ReneWealth managers shl cntinsl mnitr client satisactin t etermine whether the ering nees
t be ajste. This will nt nl generate ieas r rening the apprach bt will als signalt bth
clients an the rganizatinthe imprtance wmen as a client segment.
As imprtant as it is r wealth managers t imprve hw the serve wmenparticlarl sinceiscntent was highest amng clients with $1 millin t $5 millin in AM (the sweet spt r man
private banks)it is eqall imprtant that the nerstan the cst artless vertres. overreacting t
-
7/29/2019 Wealth Management for Women
11/12
T B C G J
Leveling the Playing Field 10
the prblem with graceless sltins will mre harm than g. There is a ne line between being
aware what wmen want an verstating the relevance generalizatins.
Likewise, wealth managers shl nerstan that the ierences amng inivials are ging t be ar
mre imprtant than the ierences between the geners. An initiative aime explicitl at wmen is nl
ging t scratch the srace a clients nees. Man ther actrssch as the clients stage in lie an in
wrk, her cntr rigin r resience, an her level wealthcme int pla.
Wealth managers can pt their RMs in a better psitin t initiate r enrich relatinships simpl b calling
attentin t areas where wmen generall eel nervale r verlke. Ambitis wealth-management
instittins shl evelp rbst training prgrams an incentive sstems that rive hme the impr-
tance actins that can make a meaningl ierence t wmen. The twar changes ma be sbtle,bt the can still resnate with wmenan ths lea t higher satisactin an greater lalt.
Women control about 22 percent of the wealth in the
Middle East, although there are marked dierencesamong countries. Several factors make women both
distinct as a group and increasingly important to
wealth managers. For example, high divorce rates
force women to think more about nancial security
and independence for themselves and their chil-
dren. In addition, a high proportion of female clients
are young entrepreneurs, many of whom are on the
verge of joining the high-net-worth segment. Finally,
although women tend to inherit less wealth than
men, the gap is narrowing.
Women in the Middle East have many of the same
grievances about wealth managers as women in oth-er regions. Many cannot nd advisors who take them
seriously, let alone ones they can trust. Clients who
lack a solid understanding of investments (but want
to learn) said that RMs do not adequately explain
the products and their risks. More sophisticated cli-
ents said that their advisors automatically assume
that they have a low risk tolerance and provide only
a limited range of investment solutions.
The lack of adequate nancial advice is at odds with
the complexities of womens nancial-planning
needs. In some societies, for example, it is possible
for multiple wives to inherit an individuals wealth.
In addition, a womans eligibility for nancial sup-port following a divorce is oen determined on the
basis of her current wealth, whether acquired before
or during the marriage. As a result, a womans nan-
cial well-being can be somewhat more precarious in
the Middle East, and wealth managers should there-
fore focus on a very clear value proposition: safe-
guarding a womans nancial independence and her
rights vis--vis third parties (who may stake a claim
to her wealth); preserving absolute condentiality;
and helping the client develop her nancial knowl-
edge.
Despite a strong need for a targeted approach forwomen in the Middle East, the opportunity to reach
this group has gone largely unnoticed, although the
situation is starting to change. The nancial crisis
prompted many clients to move their assets to local
banks, which are now working to upgrade their pri-
vate-banking oerings in order to retain these newly
acquired clients. A small number of banksbut only
local competitors to datehave launched oerings
that target women.
Developing an Offering for Women in the Middle East
-
7/29/2019 Wealth Management for Women
12/12
T B C G J
Leveling the Playing Field 11
About the Authors
The athrs are cre members the financial Instittins practice The Bstn Cnslting Grp. Theare als part the team that prces BCGs annal reprt n glbal wealth.
Peter Damisch is a partner an managing irectr in the Zrich ce The Bstn Cnslting Grp.y ma cntact him b e-mail at [email protected].
Monish Kumar is a senir partner an managing irectr in the rms New yrk ce an the glballeaer the asset an wealth management segment the financial Instittins practice. y macntact him b e-mail at [email protected].
Anna Zakrzewski is a principal in BCGs Zrich ce. y ma cntact her b e-mail [email protected].
Natalia Zhiglinskayais an assciate in the rms Zrich ce. y ma cntact her b e-mail [email protected].
first an remst, the athrs wl like t thank the wmen wh participate in r srve an sharetheir experiences in interviews. We cl nt have written this paper witht their participatin. We alsspke with a range wealth management experts an private-banking exectives arn the wrl.The, t, mae an invalable cntribtin t r paper.
We als rew n the knwlege an experience r BCG clleages. In Asia-Pacic, we calle nNelsn Chi, Vin Kmar, Tjn Tang, an Miki Tssaka. In Erpe, we relie n daniel Kessler, KirstenLange, An Magire, an Pia Tischhaser. Jel Miz, feeric Mxi, an Anr Xavier prvieinsights int Latin Americas wealth-management sectr. In the Mile East an Arica, we calle ndglas Beal, Sven-ola Vathje, an Lnn Zvighian. frm Nrth America, we receive giance rmPal orlaner an Carrie Perzanwski. fr insights int the braer theme the emale ecnm, werelie n Michael Silverstein. In aitin, we spke with Pressr Thmas dren rm Sigmn fre
universit abt the rle wmen in wealth management.
The athrs wl als like t thank the members the cre prject team, Jith Albrecht an PatrickLehner, as well as dan Cne r his help in writing the reprt, an Kim frieman an Janice Willett rcntribtins t its eiting, esign, an prctin.
The Bstn Cnslting Grp (BCG) is a glbal management cnslting rm an the wrls leaingavisr n bsiness strateg. We partner with clients in all sectrs an regins t ienti their highest-vale pprtnities, aress their mst critical challenges, an transrm their bsinesses. or cstm-ize apprach cmbines eep insight int the namics cmpanies an markets with clse cllabra-tin at all levels the client rganizatin. This ensres that r clients achieve sstainable cmpetitiveavantage, bil mre capable rganizatins, an secre lasting reslts. fne in 1963, BCG is a privatecmpan with 69 ces in 40 cntries. fr mre inrmatin, please visit www.bcg.cm.
The Bstn Cnslting Grp, Inc. 2010. All rights reserve.7/10