Onawa Lacewell: What are the primary reasons why wealth managers and private banks should include concierge and lifestyle services as part of their UHNW offering?
Alex Cheatle: First, it’s good business and contributes to the bottom line. Private banks and wealth managers achieve a positive return on investment from a strong client acquisition proposition, as well as increased assets under management and improved retention metrics when they offer clients concierge and lifestyle services.
Next, leading private banks and wealth managers use concierge and lifestyle services to further differentiate their proposition and service of UHNW clients. Why is it important to differentiate? The core banking, financial, and investment propositions are increasingly productized and homogeneous.
Concierge and lifestyle services also directly increase customer loyalty, increasing customers’ lifetime value. For example, engaged users of Ten Lifestyle Group are also more engaged with the private bank’s brand, spending up to 30% more due to the timely and personalized interactions.
Lastly, Ten Lifestyle Group’s dedicated data team works collaboratively with private banks and wealth managers to help them understand the profiles and behaviors of their customers and to accurately predict future trends.
Onawa: Name top three trends you’ve seen in the concierge and lifestyle services industry in the past three years.
Alex: The first trend we see is increased focus by our corporate clients on the customer experience. Improvements to technology mean that consumers are increasingly accustomed to highly personalized services, expecting it in all aspects of their daily life, including banking.
Another trend is a focus on the next generation. Statistics indicate that the wealthiest individuals around the world will start transferring their wealth to the next generation in the coming decade. To meet this change, private banks and wealth managers need to build multi-generational relationships prior to the wealth transfer to retain individual clients. By offering concierge and lifestyle services with a proven track record of engaging younger generations, private banks and wealth managers can almost effortlessly nurture bonds to build loyalty and increase retention.
And the last trend we see is investment in technology in the industry ─ but none has taken Ten Lifestyle Group’s approach of investing in technology in order to offer a wide range of benefits and services, coupled with an intuitive end-to-end digital client journey. Small niche or local concierge providers are finding it challenging to meet clients’ growing needs. For example, many UHNW clients now have expectations of global service, with access to partnerships and benefits not only in their home country, but in all major cities and holiday destinations worldwide.
Onawa: To what extent are UHNW clients demanding digital access to concierge and lifestyle services?
Alex: Independent of wealth levels and demographics, customers are increasingly digital savvy. They expect to access their concierge and lifestyle services through the channels that are most suitable for their requests ─ ranging from self-service on the digital platform to placing a simple research request over WhatsApp, WeChat, or webchat. The COVID-19 pandemic accelerated the adoption of digital services, including online shopping and access to events and master classes via live webinars and pre-recorded videos.
We’ve seen significant increases in members using digital services in recent years, specifically events and benefits (e.g., access to product launches or members-only offers), dining, travel, and entertainment tickets. These digital services give members instant access to benefits, including online offers, making restaurant reservations, or simply access to the artists or bands they wish to see and the ability to secure tickets as soon as the next tours are announced ─ all done without the need to call to speak to an expert.
Onawa: How does digital access increase or change the way UHNW clients use concierge and lifestyle services?
Alex: Despite COVID-19, our digital platform has increased in popularity year-on-year. Certain elements of the platform, including offers and benefits, virtual events, and inspiring content, had a spike in popularity due to global lockdowns.
As a result, we have seen increased usage of the platform across all elements, as members have adjusted to accessing the service over digital channels ─ a trend that we predict will continue as the world emerges from the pandemic. Lastly, another trend that we have observed is that as we launch our services with new cohorts of members and make digital services available, members have a higher tendency to embrace a digital-first behavior.
Onawa: Thank you, Alex, for taking the time to chat with us today.
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For more information about value-added and exclusive services for UHNW clients, please see Cutter’s newly published UHNW Benchmarking report. Our research provides a quantitative benchmarking of how top global private banks and wealth managers provide, position, and promote services for UHNW clients, makes recommendations for enhancing UHNW services to ensure future growth, and explores lessons from outside the industry on providing luxury services for the ultra-wealthy client.