Client segmentation done right is vital to profitability for any wealth manager. It is essential for financial institutions to get their segmentation strategies correct to target and engage their clients and prospects in a relevant way. And as segmentation strategies mature, wealth managers globally need to think about the types of clients they want to continue serving and how their targeting, engagement, and overall business models will evolve to ensure tangible added value.
“It has long been understood by wealth managers globally that segmentation of clients cannot be one-dimensional or static. The need to foster client stickiness has resulted in a desire to better understand clients’ preferences and overall behaviors,” says Aite Group senior analyst Meghna Mukerjee. “Wealth managers are trying to pinpoint areas of competitive differentiation, scalability, and business opportunity within specific verticals and new client cohorts. Some wealth managers are doing this successfully, but there is plenty of room for improvement across the industry,” she explains.
This Impact Report examines how customer segmentation strategies have been evolving in wealth management in recent years, what the main drivers are, what the status quo is, and how forward-thinking firms are ripping up the rule book and creating new ways of viewing their clients. It is based on 12 qualitative primary interviews that were carried out between February and May 2021 with senior executives at wealth management firms, consultants, and technology vendors across Europe and North America.
